GM Design Group, a maker of women’s suits and sportswear under the Garfield & Marks and Womyn labels, is dressing itself up for a sale, The Post has learned.
GM’s owner, private equity firm Pegasus Capital Advisors, has hired Financo, an investment bank that specializes in retailing, to find a buyer for the Seventh Avenue apparel manufacturer.
A spokeswoman for GM Design declined to comment on the company’s plans. A Financo spokesman also declined to comment. A representative of Pegasus was not immediately available.
As a maker of better-priced clothes for women, such as double-faced tweed blazers for $380 and twill halter dresses for $210, GM would likely draw the attention of the large apparel manufacturers – companies like Jones Apparel, Liz Claiborne and Kellwood, which have been snapping up smaller rivals, analysts said.
The sale process is still in the early stages and financial documents have yet to be distributed to potential suitors, people familiar with the situation said.
As a private company, GM does not disclose financial figures. People familiar with the company said it was profitable, and valued it at roughly $80 million, or about equal to its annual sales.
The market for women’s tailored clothing has suffered in recent years, as people have grown accustomed to dressing casually in the workplace.
Despite recent reports that suits are experiencing a comeback, a rebound has yet to show up in the numbers. For the 12 months that ended in November, sales of women’s tailored clothing totaled $14.1 billion, a 12.4 percent drop from the prior year, according to the NPD Group.
GM may have an ace up its sleeve, however, potentially making it more attractive to the large apparel manufacturers that rely on department stores to sell their clothes.
GM sells most of its clothes through specialty boutiques – a new and potentially lucrative distribution channel for the larger manufacturers, and one that would mitigate a department store practice of collecting “markdown” money from suppliers whose clothes don’t sell at full price.
Pegasus Capital has about $800 million in assets under management. In addition to investing directly in businesses like GM, Pegasus also provided the financial backing for Pegasus Apparel Group – a holding company that bought a string of designer brands, including Daryl K and Judith Leiber, but then ran out of steam.