Liz Claiborne courts Kate Spade

Clothing conglomerate Liz Claiborne has entered the fray as a potential buyer of Kate Spade. The brand is being sold by equity firms Texas Pacific Group and Warburg Pincus, who purchased Spade from the Neiman Marcus Group in May 2005 for $5.1 billion (£2.9 billion).

Industry sources have told WWD that two other companies are also interested in the brand, where husband-and-wife team Andy and Kate Spade act as chief executive and designer respectively. A source told WWD that "the Spades want to continue to play a role in the company after it's sold." Liz Claiborne is said to be eager to make a purchase, especially after having lost out to J. Jill in a bid for Talbot's.

Kate Spade made an auspicious start with an offering of bags, but soon branched out into eyewear, footwear, ready-to-wear, home products, stationary and hair accessories. The company has opened its own boutiques and there is also a Jack Spade division that sells leather goods and other accessories for men. In 2005/6, the company generated $275 million in retail sales and has predicted an increase of 40 percent for this year.