Blue Holdings Launches European Venture
Blue Holdings Inc., the publicly-traded denim manufacturer that produces the Antik, Taverniti So Jeans and Yanuk brands, recently announced a joint venture that will produce, manufacture and distribute the three brands in Europe.
The new company, aptly named Newco, is a partnership with French manufacturer and distributor Global Fashion Group.
Blue Concept (of which denim veteran Paul Guez is majority shareholder) and Global Fashion Group will each own 50 percent of Newco.
Launched this year by Frederic Chevalier and Christopher Bosc, Global Fashion Group paid an upfront licensing fee of 200,000 euros, or $242,000, to establish Newco. Chevalier has a marketing background, and Bosc worked under Taverniti designer Jimmy Taverniti before becoming France’s general manager for Valentino Couture.
Under the terms of the agreement, Newco will license the three brands for two years, with the option to renew for another three years if it achieves minimum sales levels.
If the agreement is renewed in 2007, Blue Holdings stands to earn more than $13 million in fees by 2010. Guez estimated the figure could be as high as $16 million in five years. Blue Concept has the option to buy Global Fashion Group’s interest in Newco at the end of 2007.
The joint venture will split responsibilities for the licensed brands. Blue Holdings will be responsible for the design, development, publicity and marketing of the Antik, Taverniti and Yanuk brands in Europe. Newco will assume responsibility for financing, distribution, selling and administrative duties for the brands in Europe. The licensed denim will be produced domestically and in Mexico and Europe, Guez said. Newco will get first dibs on future brands developed by Blue Concept.
The Antik, Taverniti and Yanuk lines, which Guez said are shipping now, will largely mirror the American lines, with some key silhouettes tailored for the European customer. Blue Holdings is looking to establish the same sort of joint venture with its Japanese distributor, Guez said. —Erin Barajas
