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Nitches plans to buy Saguaro brand
26 Jun '06
2 min read
Womenswear importer Nitches Inc has entered into a definitive agreement to acquire the Saguaro mark and related trademarks from Impex Inc, a leading manufacturer of branded and non-branded specialty, western, and private-label apparel.
Since January 2005, Nitches has been manufacturing and distributing Saguaro apparel products to specialty and catalog retailers under the terms of a strategic alliance with Impex.
Under this alliance, Nitches has recorded the revenue from such sales and remitted royalties and design fees to Impex as part of its operating expenses. Upon the closing under the Acquisition Agreement, Nitches will no longer be required to pay such fees to Impex. Accordingly, profit margins for the Saguaro products are expected to increase.
As of May 31st 2006, Nitches' backlog for Saguaro products totaled $12.0 million, with approx. $4.6 million on order for shipment to customers by August 31st 2006, and the remaining $7.4 million for shipment during the first quarter of Nitches' fiscal 2007. The current year backlog represents a 324 percent increase from Nitches' backlog for such products at May 31st 2005 of $3.7 million.
Nitches' President and COO Paul Wyandt remarked, "Through one and a half years of working with Impex, we have seen the benefits of leveraging Nitches' sourcing, financing and distribution capabilities to support substantial revenue growth for the Saguaro product line. By acquiring the brand at this time, we eliminate alliance royalties and fees and position Nitches to directly capitalize on further planned expansion of the Saguaro product lines."
Since January 2005, Nitches has been manufacturing and distributing Saguaro apparel products to specialty and catalog retailers under the terms of a strategic alliance with Impex.
Under this alliance, Nitches has recorded the revenue from such sales and remitted royalties and design fees to Impex as part of its operating expenses. Upon the closing under the Acquisition Agreement, Nitches will no longer be required to pay such fees to Impex. Accordingly, profit margins for the Saguaro products are expected to increase.
As of May 31st 2006, Nitches' backlog for Saguaro products totaled $12.0 million, with approx. $4.6 million on order for shipment to customers by August 31st 2006, and the remaining $7.4 million for shipment during the first quarter of Nitches' fiscal 2007. The current year backlog represents a 324 percent increase from Nitches' backlog for such products at May 31st 2005 of $3.7 million.
Nitches' President and COO Paul Wyandt remarked, "Through one and a half years of working with Impex, we have seen the benefits of leveraging Nitches' sourcing, financing and distribution capabilities to support substantial revenue growth for the Saguaro product line. By acquiring the brand at this time, we eliminate alliance royalties and fees and position Nitches to directly capitalize on further planned expansion of the Saguaro product lines."
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