CLEVER Linda Wachner.
Warnaco’s combative chairman and CEO let Calvin Klein think he had a real chance of selling his design empire to the buyer of his choice.
She let Tommy Hilfiger think he had a shot at getting the lucrative business for himself.
And she let us poor journalists think we were covering a real horse race.
But Linda knows better. Calvin may have rejected her first bid, but she’s been in the driver’s seat all along.
A quick recap for anyone coming late to this tangled tale: Calvin Klein wants to sell his company for $1 billion. Bidders such as Tommy Hilfiger and HdP have dropped like flies. Enter — or re-enter — Linda Wachner.
Linda is controlling the bidding for Calvin Klein for two reasons.
One is that she owns the licenses for a huge chunk of Calvin Klein apparel. She makes both CK jeans and the Calvin Klein underwear — which are estimated to generate $1 billion of the $2.5 billion wholesale Calvin Klein products ring up each year.
The jeans alone ring up $750 million a year, and most people don’t want the Calvin Klein pie without that juicy slice.
Wachner knows what she’s got. That’s why she had the chutzpah to demand a billion dollars when Tommy Hilfiger wanted to buy the jeans license from her. (He ultimately dropped his bid for Calvin Klein, reportedly one of those unwilling to pay top dollar for the company minus the jeans.)
But Wachner’s got more in her favor than the CK jeans license. She’s also got her reputation as a holy terror.
Everyone in the fashion business knows her as a shrewd executive — and a legendary screamer accustomed to getting exactly what she wants.
“She plays by her own rules. Anyone buying that business has to be involved with her — and that’s not easy,” says one fashion insider.
Linda gave ample warning of what it would be like to share Calvin’s empire when she announced plans to sell Calvin Klein underwear in J.C. Penney. Klein was reportedly furious — J.C. Penney isn’t exactly the upscale image he cultivates — but Wachner brushed it aside.
Her message to potential bidders (intentional or not): ‘I’m wagging the dog here.’
Calvin may decide he’d rather pull his company off the market than sell to Linda Wachner.
But either way she wins.
If she buys Calvin Klein Inc., she gets a cash cow that can pump up her own revenues and boost Warnaco’s faltering stock. And if there’s no sale, she’s still got the best part of Calvin’s business.
Clever Linda Wachner. Good things come to those who wait — and scare away the competition.
Please send your e-mail to: