women polo t shirts Cutting His Own Figure in Fashion
Peter Boneparth is Seventh Avenue’s un garmento, a guy who didn’t grow up in the clothing business, who doesn’t slap backs, the one who came from Wall Street.
In his two years as chief executive of the Jones Apparel Group, Mr. Boneparth has kept Jones, the country’s third largest clothing company, in the news, mainly for a series of take no prisoners maneuvers that have raised eyebrows among his peers.
Early last year, Mr. Boneparth, 44, took on no less of an industry legend than Ralph Lauren, throwing his company’s biggest single license back at Polo Ralph Lauren and creating a new line to take its place.
In his short tenure, he has bought two big clothing companies, Gloria Vanderbilt and Kasper, adding them to the Jones stable, which already included Nine West and Bandolino. This spring, he unleashed a hostile takeover bid on Maxwell Shoe, a $225 million company that holds the license to make Anne Klein shoes.
With his purchase of Kasper and his move to replace the Lauren line, Mr. Boneparth played a significant role in the industry’s apparently successful rediscovery of the midprice clothing market. He has also made over the image of Jones, a huge garment producer that had grown a bit sleepy.
The stock has certainly been volatile. It closed at $39.69 on the day Mr. Boneparth became chief executive, dipped to $27 during the feud over the Lauren line, and closed yesterday at $36.79. Last week, the company reported earnings for the first quarter of 2004. Surprising no one, the loss of the Lauren line hurt profit margins, which dropped to 13.3 percent from 16.9 percent a year ago. Earnings also fell, to 73 cents a share from 90 cents in the quarter in 2003, and total revenue dropped slightly.
But the figures were better than both Jones and analysts had projected, and Mr. Boneparth raised projections for revenue and earnings for 2004. Although he remains cagey about the rest of his plans, he said he was still hungry to buy companies that would fit his vision for Jones.
”Our ultimate vision is to build a diversified company that’s bulletproof,” he said. ”We’re not overly reliant on any one brand, any one product or any one customer. As we grow, we’d like to be all things to all people.”
In the process, Mr. Boneparth has become something of a lightning rod in the industry, according to Todd D. Slater, a retail analyst for Lazard who covers Jones and recommends the stock.
”The traditionalists don’t like him,” Mr. Slater said. ”He’s more deliberate; he’s not somebody you can push around. People think he’s arrogant, but he’s a guy who thinks structurally. People say he’s a hothead, he’s intransigent, but does he fire people on the spot? Is he in any way unprofessional? I haven’t heard that.”
Jones’s bid for Maxwell is already promising to be a juicy battle. The Securities and Exchange Commission has finished its review of the Jones consent solicitation; the tender offer of $20 a share has been extended to May 17.
The Maxwell board urged rejection of the offer. On April 1, Maxwell accused Jones in a Massachusetts court filing of making ”materially false and misleading statements” including the assertion that the Jones bid of $20 a share ”provides an attractive premium” to shareholders. The current stock price, as of yesterday’s close, was $22.46.
”Everybody’s making such a big deal about this ‘hostile’ takeover,” Mr. Boneparth said, with a shrug. ”They’ve rejected $20 a share, and we want to have a direct conversation with the shareholders. I have a good relationship with their chief executive. We’re just trying to do a deal, like any other deal.”
Mr. Boneparth who, with his slim, rather bland good looks, presents an image different from that of many of his more careworn peers conceded that although he is a deal maker, he is not a true garmento. ”My parents and my grandparents and my great grandparents were not in the clothing business,” he said.
But they were in retail. ”My dad owned three or four furniture stores, clearance centers on Long Island,” he said. (He remembers the little black sales book his father carried, the phrase ”Beat Yesterday” handwritten on its cover.) He worked on the furniture trucks during the summers; he went to Woodmere Academy, a private day school. He graduated from the University of North Carolina and the University of Virginia’s law school, then headed to Manhattan in 1984, first to handle corporate securities for Shea Gould, a large Manhattan firm that has since gone out of business, then doing deals for Mabon Nugent, a small investment banking firm.
In 1997, after more than a decade on Wall Street, he woke up, he said, and decided he needed a change. As a banker, he had assisted Norton McNaughton, an apparel company with its own moderate label, to go public; a few years later, he says he saw that the company had hit a wall. ”They had not moved their sourcing offshore and had not made the changes to compete,” he said.
”But I thought the apparel industry would consolidate and that not many people knew what that meant,” he explained. The company asked him to come to work there full time. ”I thought it was an interesting opportunity; most people thought I was stark raving mad,” he said.
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In 2001, the company, which had become the McNaughton Apparel Group, was sold to Jones, under Mr. Boneparth’s direction. In May 2002, after a year at Jones in charge of moderate apparel, he became chief executive.
Not long after he arrived at Jones, Mr. Boneparth took part in what became a messy feud over the Lauren department store line, which Jones produced under a license. In June 2003, negotiations between the companies ended after a prolonged argument over whether Polo Ralph Lauren had the right to take the $548 million Lauren line away from Jones because Ralph, another line licensed to Jones, had not sold well enough. Mr. Boneparth left the room, and then came back to announce that Jones was suing Polo Ralph Lauren for the money it would lose from having the line taken away.
Two hours later, Polo Ralph Lauren filed a countersuit, asking the court to determine whose interpretation of the contract was correct.
Behind the scenes, some of Jones’s competitors questioned whether Mr. Boneparth had behaved a trifle hastily at that last meeting.
”It was part of a very well thought out strategy, and the board know all about it beforehand,” Mr. Boneparth said. ”Lauren had their own strategy, too. How else could they have been able to file their own lawsuit two hours later?”
But the feud only bolstered Mr. Boneparth’s legend in the garment district. ”What he did with Ralph was just unbelievable,” one industry executive said yesterday, speaking of Mr. Lauren. ”One of the biggest names in the business and Boneparth wouldn’t even deign to meet with him.”
Mr. Boneparth said that statement was ”absolutely untrue.”
”I met with Ralph a number of times,” he said, ”both before and after the negotiations began.” Why would people have this idea? ”It sounds good,” he replied. ”You know: ‘Who’s this kid Boneparth who won’t meet with Ralph?”’
However the cases come out, Mr. Boneparth argued, the feud ”goes under the heading that everything happens for a reason in life.” He paused and then said, ”Although at the time, it didn’t seem like it.”
The reason was that losing the license freed him to develop the Jones Signature line, which features pink silk blouses with white polka dots and a silky green cable knit sweater paired with an above the knee brushed cotton skirt.