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Liz Claiborne announces Mexx JV with Gores Group

Liz Claiborne, Inc has agreed to sell its global Mexx business to a joint venture majority-owned by private equity firm the Gores Group, in exchange for 18.75% of the common equity of the joint venture and a total cash consideration of USD85 million.

The transaction is subject to working capital closing adjustments, which includes USD60 million of ABL facility debt that is expected to be assumed by the joint venture and refinanced at closing.

The Gores Group will own an 81.25% majority interest in the joint venture and has also committed to supporting the business through its ongoing turnaround.

The global Mexx business will continue to be led by Thomas Grote as Chief Executive Officer, while Lloyd Perlmutter will continue as Chief Executive Officer of Mexx Canada. The transaction is expected to close in the fourth quarter.

Alec Gores (pictured), Founder and Chairman of The Gores Group, says: "We are excited to partner with Liz Claiborne, Inc. and to back this management team to continue the turnaround efforts which are well underway.  This transaction serves as a prime example of our ability to apply our extensive carve-out experience to the retail sector, and we see an excellent opportunity to create value and rebuild a great brand."

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