Iconix Brand Group completed an initial monetization of its London Fog brand in China in December with its partner in the territory, China Outfitters, with an initial public offering on the Hong Kong Stock Exchange.
The announcement marks the first monetization event for Iconix businesses in China. Iconix China currently has retail partnerships for six of its brands including Candies, Rampage, Badgley Mischka, Rocawear, London Fog and a recently signed agreement for Royal Velvet. The partnership between Iconix China and China Outfitters began in April 2009. Since then more than 100 London Fog stores and shop-in-shops have been opened throughout China.
The monetization of London Fog China was triggered by the recent IPO of China Outfitters, in which Iconix China received shares in the global offering. Iconix China sold approximately 54 percent of its shares in the offering and retains the remainder. Iconix expects earn an initial pre-tax gain of approximately $6 million related to its share of this monetization event.
"Today's announcement is a pivotal mark for our long term growth strategy in China," says Neil Cole, chairman and chief executive officer of Iconix Brand Group. "The Iconix brands that have launched in China to date are performing well. With the recent IPO of China Outfitters, we realized an initial gain for our London Fog brand and expect to participate in the future growth of the brand through the shares we are retaining."
"The IPO of China Outfitters is just the beginning of our long term potential in China," says Veronica Chou, president of Iconix China. "We are excited about the growth opportunities for the six brands we have signed, and are continuing to seek out quality partners for the entire Iconix portfolio."