NEW YORK (AP) - Talk about a makeover.
Financially struggling Liz Claiborne Inc. said Wednesday that it is selling its namesake brand and several others to concentrate on its Juicy Couture, Lucky Brand and kate spade fashion plates, which appeal to well-heeled shoppers. The company, which hasn't had an annual profit since 2006, said it will change its name to reflect that emphasis.
Liz Claiborne is the latest company to adjust its business as the U.S. consumer market bifurcates into the high and low ends, essentially squeezing out the middle. Companies ranging from Procter & Gamble to Wendy's are doing everything from tweaking their product mix to changing the way they advertise and display their goods to appeal to American consumers on opposite ends of the spectrum.
Liz Claiborne, whose annual revenue has dropped by half from 2006 through last year, hopes that a more high-end focus will help it turn around its business. Lucky Brand jeans mostly sell for $99 or more, and kate spade handbags typically start at over than $100.
"Over the past few years, we have worked diligently to turn this into a more efficient, dynamic, brand-centric, retail-based company," CEO William McComb said. "Today marks the culmination of these efforts."
McComb said during a conference call Wednesday that along with streamlining its operations, Liz Claiborne will need to "resize its corporate infrastructure," which could mean job cuts.
Liz Claiborne said it will sell the domestic and international trademark rights for both its Liz Claiborne brands and the U.S. and Puerto Rico trademark rights for the Monet jewelry brand to department store operator J.C. Penney Co. for about $288 million.
Liz Claiborne expects to generate about $328 million from its sales.