RAGTRADER: Tracey McEldowney
MELBOURNE: Pacific Apparel Solutions (PAS) is again flexing its acquisition muscles.
The Victorian-based wholesaler last week signed an agreement to purchase popular childrenswear label Chino Kids in what is its fifth major purchase in the past two years.
The group’s existing brands include Yarra Trail, Black Pepper, Yvonne Black, Marco Polo, Capital M and Sirocco.
However, in what appears to be a clearly defined, aggressive growth strategy, the group’s anticipated buy-outs do not finish there with PAS Group chief executive officer Eric Morris confirming a further two deals are in the pipeline.
Speaking exclusively to Ragtrader Morris, who has been at the helm of the Deutsche Bank-backed company for just over a year, said he hoped to have the new agreements signed off by the end of October.
“I will tell you that one is a well-known womenswear brand but I’m afraid if I told you the other it would probably give it away. We hope to close the deals by the end of September but if this is not possible then certainly by the end of October.”
Morris, who counts Pacific Brands, Oroton and Gazal among his company’s competitors, has made no secret of the fact he is in negotiations with several other brands with a view to further acquisitions.
The latest purchases would make his group a “serious size” and, while Oroton was more retail-based, and Pacific Brands was a “big business that didn’t really operate in the same space as PAS”, all competition was good, he said.
Morris declined to reveal either the purchase price for Chino, a 10-year-old brand founded by entrepreneurs-cum-designers Amber Nicholas and her mother Sandy – or the amount the group had in its kitty for future purchases. Nor would he confirm earlier speculation that suggested the group, which supplies Myer, David Jones, Target and about 1600 independent boutiques, had in excess of $50 million to play with.
“I think we’ll come back to that question…or may be not,” the former Myer executive said.
It is understood the purchase of Chino was made under PAS’ subsidiary arm, Design Works, and includes all intellectual property associated with the label, together with a small design team.
The label will continue trading under its own name and Amber Nicholas will remain as designer.
While Nicholas will report to Design Works head Gary Brown, the business would continue to operate relatively independently with extra resources drawn from PAS’ 180-strong employee base.
The move coincides with a change in name for the group, which recently dropped the title Pacific Apparel Solutions in favour of the more succinct PAS Group in an effort to help the company develop its own culture.
It would also differentiate it from its better known Hawthorn-based rival.