TULTEX TO ACQUIRE SPORTS APPAREL SCREENPRINTER
TULTEX TO ACQUIRE SPORTS APPAREL SCREENPRINTER MARTINSVILLE, Va., Nov. 18 /PRNewswire/ -- Tultex Corporation
(NYSE: TTX), one of the nation's largest producers and marketers of activewear apparel, has entered into a definitive agreement to acquire the assets of Logo 7, Inc., announced Tultex Chairman and CEO John Franck today. Logo 7 is a privately owned Indianapolis-based screenprinter of sports apparel imprinted with professional and college team logos and designs. The purchase price will involve and exchange of $15 million of a new series of Tultex cumulative convertible preferred stock and $45 million in cash.
Organized in 1971, Logo 7 has become a leader in producing and marketing professional sports licensed apparel. The company is a licensee of the National Football League, Major League Baseball, the National Hockey League, the National Basketball Association, and other sports organizations for imprinting sports apparel with team logos and designs. Logo 7 acquires blank garments from a number of sources, and screenprints and embroiders a variety of logos and designs on those garments for sale through mass merchandisers, team shops, sporting goods stores and chain stores. Most of the company's products are sold under the "Logo 7" brand name. Logo 7 projects sales in excess of $85 million in 1991 and has a strong record of sales growth and profitability. "Logo 7 is a proven winner in the fast-growing licensed pro sports business," Franck said. "The acquisition is expected to result in strong synergistic benefits for Tultex. The availability of Tultex' resources will enable Logo 7 to increase its sales of licensed sports apparel. "The increased demand for Logo 7 products will give us higher utilization of available production capacity. We expect the Logo 7 acquisition to have a positive impact on sales and earnings per share in 1992 and thereafter." Following the acquisition, which is expected to be completed early in January, Logo 7 will continue to be headquartered in Indianapolis, where it is constructing a new administrative, manufacturing and warehousing facility. The organization will retain its names and will continue to be headed by Thomas Shine, a founder and current CEO. No changes in management or personnel are anticipated. The $15 million of cumulative convertible preferred stock will be convertible into Tultex common stock at a conversion price equal to the greater of 125 percent of the average closing price of Tultex common stock for the 20 days prior to closing, or $8.75. It will carry an annual dividend of 7.5 percent. The preferred stock will vote with common stock on all matters, with each preferred share having one vote. Upon closing the transaction, Tultex will elect to its board of directors a representative for Melvin and Herbert Simon, the current owners of Logo 7. The Simons are the sole owners of Melvin Simon & Associates, Inc., one of the country's leading developers of enclosed shopping malls, community centers and commercial properties. The Simons also own the Indiana Placers NBA franchise. Tultex Corporation is a leading vertically integrated manufacturer, marketer and distribution of fleecewear and T-shirts. It operations yarn and apparel manufacturing facilities in Virginia, North Carolina and Jamaica. Its activewear line includes sweatshirts, jogging suits, track suits and other garments sold under the Discus Athletic, Sweats Express and Tultex Maximum Sweats brand names. Tultex also manufactures a significant volume of apparel under private label arrangements with wholesale and retail customers. It recently announced a licensing agreement with Levi Strauss Associates to make and market fleecewear under the Britannia brand name. For the year ending Dec. 29, 1990, Tultex had sales of $355,117,000 and net income of $23,470,000. For the nine months ended Sept. 29, 1991, net sales were $193,914,000 and net income was $12,000, compared with sales of $247,347,000 and net income of $12,757,000 for the same period in 1990. -0- 11/18/91 /CONTACT: Don P. Shook, vice president of finance & administration of Tultex, 703-632-2961, ext. 2304/ (TTX) CO: Tultex Corporation ST: Virginia IN: TEX SU: TNM SM-OS -- NY034 -- 1351 11/18/91 10:52 EST
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|Date:||Nov 18, 1991|
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