Liz Claiborne Sells Fragrance Rights to Elizabeth Arden
Same fragrance, different Liz.
In an effort to cut costs, Liz Claiborne has sold its fragrance rights and trademarks to Elizabeth Arden for $58.4 million in cash, the Wall Street Journal reports.
The Elizabeth Arden beauty company will now own the right to license Curve fragrance as well as some smaller brands. As part of the deal, Liz Claiborne will retain its fragrance licenses for brands like Lucky and Juicy Couture, but will cut its royalty rates and require prepayment for other royalties.
Facing a second-quarter loss of $89.9 million and the shuttering of its last company-owned distribution center in the U.S., Liz Claiborne has also inked a deal with Li & Fung Ltd. to distribute its goods, therefore reducing fixed distribution costs.
Money brought in from the Elizabeth Arden deal will be used to pay down the company's debt, which was reported to be more than $548 million at the end of the second fiscal quarter.
"[This] supports our goal of ending 2011 with lower debt levels than at year end 2010," Liz Claiborne CEO William McComb said in a press statement.
