Reed Krakoff to buy namesake label

Luxury accessories label Coach is set to sell its Reed Krakoff brand to a group headed up by founder and designer Reed Krakoff, Coach’s long-time Executive Creative Director who announced that he was leaving the brand to focus on his own namesake

label.

When Krakoff announced he was stepping down from his position earlier this year, the American fashion house hinted at the sale of Krakoff’s label, saying that it was exploring “strategic options”, and the company confirmed yesterday that the sale is anticipated to close in the first quarter of fiscal 2014.

Krakoff was set to depart in June 2014, though the date has now moved to coincide with the completion of the sale. His replacement at Coach was announced last month, he will be succeeded by British designer Stuart Vevers, who is leaving his role as Creative Director of Spanish fashion house Loewe. There has been no word on Vevers start date, just that his appointment is an “important milestone” for Coach’s transformation into a lifestyle label.

No financial terms of the Reed Krakoff sale were disclosed; however Coach did add that the transaction wouldn’t have a material impact on its first quarter results.

Coach to sell Reed Krakoff as two executives leave

The leather goods label also confirmed the departure of two top-level executives, Mike Tucci, President of Coach’s North American group, and Jerry Stritzke, President and Chief Operating Officer, who will both be leaving at the end of August. Tucci will be replaced by Francine della Badia, currently Executive Vice President responsible for all North American retail merchandising, planning and allocation.

Their departure follows Chairman and CEO Lew Frankfort's decision earlier this year to step down from his position in January 2014, to make way for successor Victor Luis.

The announcement came as Coach reported its overall revenue rose 5.8 percent to 1.22 billion US dollars in the fourth quarter ended June 29, helped by gains in its men's merchandise and revenue increases in China.

“During the fourth quarter we approached double-digit growth in constant currency and continued to gain overall traction on our key strategies supporting our brand transformation,” said Frankfort. “We generated strong international results, leveraged the men’s opportunity globally, strengthened our digital capabilities and drove excellent initial results in the re-launch of footwear.”

He added: “While we maintained our outstanding profitability levels, we were not satisfied with our performance in the women’s handbag and accessories category in North America.”

Image: Reed Krakoff Pre-Spring 2014