Los Angeles premium-denim maker J Brand is reportedly moving closer to selling its company for $90 million to a private equity firm.
The deal, which has been months in the making, is going through the final stages of negotiations, several sources said. The exact terms of the transaction are still being worked out. In an e-mail sent Dec. 10, Jeff Rudes, one of the company's founders, said, "As of today, there is no transaction."
Sources said Rudes is hoping to stay on with the company, while Susie Crippen, the company's creative director and other cofounder, will probably leave to pursue other ventures after taking a few months off.
The sale to Star Avenue Capital, a relatively new investment entity based in the Century City area of Los Angeles, would be one of the few major deals this year to be completed in the California apparel and retail industries. Earlier this year, American Apparel sold 20 percent of its company to private equity firm Lion Capital for about $80 million. In May, Iconix Brand Group Inc. in New York bought a 50 percent interest in Hardy Way LLC, the owner of the Ed Hardy trademark and brand, for $17 million. This summer, retailer Charlotte Russe Holding Inc. was sold to private equity firm Advent International Group for $380 million.
The Sage Group, a private investment banking firm in Los Angeles that is acting as J Brand's financial adviser, has been moving the transaction forward.
The J Brand deal is very similar to one The Sage Group helped negotiate last year for Not Your Daughter's Jeans, owned by George Rudes and his children. George Rudes is Jeff Rudes' uncle and owns a small percentage of J Brand.
In September 2008, George Rudes sold a majority share of his blue-jeans company to Falconhead Capital LLC for $100 million.
J Brand's fashion-forward silhouettes are worn by slim celebrities and rock stars such as Hilary Swank, Cameron Diaz, Rihanna and Gwen Stefani. J Brand, whose jeans retail for around $158 to $224, was one of the first to launch the skinny-leg jean. Last year, it relaunched its menswear line, called J Brand Denim Co., with Sean Hornbeak, owner of the Denim Revival store, acting as director of men's.
The menswear line has a definite worn look and roomy fit to it and sells for around $158 to $257.
J Brand got its start as an exclusive at Ron Herman's Melrose jeans bar in the spring of 2005. The label sold quickly with J Brand introducing the skinny-leg jean. It has been cited as one of the more popular premium-denim labels among fashionistas in the know.
