G-III: The Industrial Powerhouse With a Voracious Appetite for Acquisitions

A Polish Holocaust survivor emigrated to the United States and, in the heart of New York's Garment District , started a leather goods manufacturing company that has become one of the American fashion giants thanks to licensing and acquisitions. More than thirty brands now make up G-III's portfolio, including Donna Karan, Tommy Hilfiger, Sonia Rykiel, Vilebrequin and the Spanish brand Awwg, of which it has held a 19% stake since last year.

Modaes magazine issue 54

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The history of G-III Apparel Group began in 1956 with Aron Goldfarb, a Polish Holocaust survivor who emigrated to the United States, where he formed the seed of the group as a company dedicated to the production of women's leather outerwear in New York, in the heart of the city. In 1972, the founder's son, Morris Goldfarb (still at the helm of the company today as CEO), joined the business, then known as G&N Sportswear.

Goldfarb Jr. was instrumental in the diversification, expansion and professionalization of the business. Following the company's industrial origins, G-III Apparel Group has grown into a U.S. fashion giant with accelerated and steady growth through licensing and acquisitions.

The company, with more than fifty years of history and several crises behind it, ended 2024 with a turnover of more than 3 billion dollars and is aiming for 5 billion dollars in the medium term. The company currently specializes in fashion design, sourcing, production and distribution, with a portfolio of more than thirty licensed and owned brands, and is listed on the Nasdaq, one of the most important stock exchanges in the world.

Twenty-five years after its birth, in 1981, the company took a leap forward to stop being only a producer and become a brand as well. G-III then launched Siena Leather Limited, a brand of leather goods for the sports sector with a high positioning and aimed at department store sales. It was then, when the company had a turnover of 100 million dollars, in 1989, that it went public in the United States, from which time it intensified its expansion process, initiating an accelerated development in the territory of brands.

The company's business model continued to evolve, and with its own brand in its portfolio, G-III then focused on licensing. Throughout the 1990s, the U.S. group grew fat by securing outerwear licenses with brands such as Kenneth Cole, Nine West, Cole Haan and House of Déreon (the brand launched by Tina and Beyoncé Knowles).

The company expanded its production activity beyond leather, entering into new licenses with high penetration in the United States, until, in 1993, the company teamed up with the National Football League to design and manufacture jackets for the teams of the American soccer competition, which it replicated over the years in Major League Baseball, the National Hockey League, the NBA, Nascar and more than one hundred American universities.

G-III has gone from being an industrial company to growing thanks to the purchase of brands and licenses.

Later, after the 1990s, the licensing phase was replaced by acquisitions. In 2005, when its annual turnover stood at $240 million, G-III acquired two coat manufacturers, Marvin Richards and Winlit. With the acquisition of the former, G-III acquired the Calvin Klein women's and men's coat licenses, as well as the St. Johns Knits outerwear license.

With the second, G-III absorbed the men's and women's outerwear license from Guess; fur outerwear from Tommy Hilfiger; and outerwear from Ellen Tracy, London Fog, Pacific Trail and BCBG by Max Azria. Marvin Richards alone was a $19.2 million cash outlay, while Winlit was a $7.3 million cash outlay.

Diversification beyond the coat business and a leap into Europe

Acquisitions in 2005 enabled G-III to move beyond coats into the design and production of clothing, sportswear and accessories. In 2007, the company added the Jessica Howard and Eliza J brands to its portfolio, strengthening its activity in the field of women's dresses. In 2008, the group took control of outerwear and handbag manufacturer Andrew Marc (then controlled by Gordon Brothers) for $42 million. The acquisition involved the addition of the Andrew Marc and Marc New York brands, but also the Dockers and Levi's licenses.

Through another acquisition, G-III made the leap into retail and the travel accessories category. In 2008, the group took over U.S. retailer Wilson Leather, founded in 1899 in Minneapolis and dedicated to the production of leather jackets, belts, footwear, handbags and gloves. Accelerated growth through licensing and acquisitions followed, and in 2011 G-III took over the rights to the U.S. brand Vince Camuto, and in 2012, made the leap into Europe, when it took ownership of French swimwear company Vilebrequin. In 2013, the company bought G. H. Bass, then controlled by PVH and specializing in footwear, for around $50 million.

The signing of Karl Lagerfeld Paris distribution and purchase of Donna Karan are G-III's two biggest deals to date.

The company's growth continued, and in the mid-2000s, G-III signed its two largest deals to date. The group created ajoint venture with Karl Lagerfeld to operate the Karl Lagerfeld Paris brand, launching it in North America in a wide variety of categories. In 2016, the company bought the Donna Karan brand from French giant LVMH for more than $650 million, with the plan to turn it into a $1 billion-a-year firm (up from $300 at the time). In the same year, G-III signed the Tommy Hilfiger license for women's fashion, which it later extended to sports, performance and denim in the United States and Canada.

But there were still other major deals to be signed. In 2021, G-III strengthened its position in Europe with the purchase of the French firm Sonia Rykiel, which had been in a complicated situation for several years, having entered the courts in 2019 and being rescued by Eric and Michael Dayan, co-founders of Showroomprivé.

In 2022, the company took the 81% it did not control in Karl Lagerfeld's global brand for $210 million. Until then, the stake was held by a group of investors led by Amlon Capital. And in 2023, the triple whammy: a multi-year agreement for the Champion outerwear license, the full 25-year license for Halston (and an option to buy the brand) and a long-term license for Nautica in women's fashion.