(Boston, MA, New York, NY and
Morrow, GA; July 16, 2001) Berkshire Partners LLC,
the Boston-based private equity investment firm, and
Investcorp, the global investment group, today announced
that they have signed a definitive agreement under which
Berkshire will acquire The William Carter Company
("Carter's") from Investcorp and its clients for
approximately $450 million.
Carter's is the nation's largest
branded marketer of baby and toddler apparel, and a
leading marketer of young children's apparel. Over its
136 years of operation, Carter's has become one of the
best recognized brand names in the children's apparel
industry. Morrow, Georgia-based Carter's markets its
products under the brand names of CARTER'S and CARTER'S
CLASSICS to department stores and specialty store
accounts, and through its 149 retail outlet stores.
The transaction, expected to close in
the third quarter of 2001, involves the continuing
leadership of the company's senior management. Upon
completion of the transaction, investment funds
established by Berkshire and management will own all of
the company's equity. Berkshire's equity investment will
total approximately $130 million.
"Over the course of our
four-and-a-half-year partnership with Investcorp,
Carter's made substantial operating and financial
progress and has further established the CARTER'S family
of brands as the most innovative and popular in the
children's apparel sector," said Frederick J. Rowan II,
Chairman, Chief Executive Officer and President of The
William Carter Company. "As we look towards the future,
we are excited to begin a new partnership with Berkshire
Partners and benefiting from their experience with
branded- and retail-oriented companies."
Bradley M. Bloom, Managing Director at
Berkshire, stated, "Carter's talented management team and
leading brand name were key factors in our decision to
invest in the company. The strategy of management to
build an industry leader that serves its customer base
and ultimately the consumer with excellent value in a
high quality, branded product is an ideal fit with our
own investment philosophy. We look forward to our new
partnership with management as they lead Carter's to
continued success."
Christopher O'Brien, a member of
Investcorp's Management Committee, said, "We are very
pleased with the outcome of the investment we first made
in Carter's in 1996. Fred Rowan and his team achieved
tremendous financial results in a range of economic
conditions by executing a strategic plan that moved the
company into new sales channels, allowed it to introduce
new product lines, and optimize its supply chain. The
company is well-positioned as the leader in an important,
growing industry, and we wish Carter's and Berkshire
Partners all the best."
In 2000, Carter's consolidated net
sales were $471.4 million, representing a nearly 50
percent increase from $318.2 million in 1996. During this
period, wholesale sales increased from $189.0 million to
$256.1 million and retail outlet store sales increased
from $129.2 million to $215.3 million.
ABOUT BERKSHIRE PARTNERS
LLC
Berkshire Partners is an active
investor in the private equity market managing
approximately $3.0 billion of equity capital. Through its
15-year investment history, Berkshire has completed 70
acquisitions or growth capital investments with a primary
focus on building solid, growth-oriented companies in
conjunction with strong, equity-incented management
teams. Berkshire invests in a number of industries
including manufacturing, retailing, transportation,
telecommunications and business services. Its private
equity transactions have taken several forms; leveraged
buyouts, recapitalizations, growth capital investments,
privatizations, and industry consolidations. Investors
consist primarily of university endowments, public and
private pension funds, insurance companies, foundations,
and financial institutions. Additional information may be
found at www.berkshirepartners.com.
ABOUT INVESTCORP
Investcorp is a leading global
investment group with offices in New York, London and
Bahrain. Since 1982, it has completed transactions in
North America and Western Europe, with a total
acquisition value of approximately $19 billion. In
addition to The William Carter Company, Investcorp and
its clients currently have investments in U.S. companies
including Stratus Technologies, Jostens, Inc., Werner
Holdings, TelePacific Communications and Independent
Wireless One. U.S. investments that have been taken
public by Investcorp include Prime Service, Tiffany &
Co., Circle K Corporation, Saks Fifth Avenue and CSK Auto
Corporation. In Europe, Investcorp and its clients
currently have investments in Avecia (formerly Zeneca
Specialties), Gerresheimer Glas, Polestar and Welcome
Break. Additional information may be found at
www.Investcorp.com.
ABOUT THE WILLIAM CARTER
COMPANY
The William Carter Company is the
nation's largest branded marketer of baby and toddler
apparel, and a leading marketer of young children's
apparel. Over the company's 136 years of operation,
Carter's has become one of the best recognized brand
names in the children's apparel industry. Carter's
markets its family of brands, including CARTER'S and
CARTER'S CLASSICS, to approximately 500 department stores
and specialty store accounts, together representing an
estimated 8,000 store fronts, as well as through its 149
retail outlet stores. The company, which is based in
Morrow, Georgia and has approximately 7,000 employees,
was founded in 1865 by William Carter in Needham,
Massachusetts. Additional information may be found at
www.carters.com.