Luxury jewelry retailer Tiffany & Co. has bought 10-year-old upscale handbag brand Lambertson Truex and hired its designer duo to help the company explore the possibility of expanding into handbag and leather accessories.
Financial terms of the deal were not disclosed. Shares of Tiffany fell 2.9% Friday to close at $28.10.
The key point of the transaction was Tiffany’s (TIF 28.10, -0.84, -2.9%) ability to hire the label’s designers Richard Lambertson and John Truex. Company spokesman Mark Aaron said hiring the designers was the “real catalyst” to the company’s decision to buy the bankrupt label.
The designers will explore the “development of a collection of handbag and leather accessories to complement” Tiffany’s existing assortment, which includes less than 1% of its sales in its own namesake line of handbags and accessories, Aaron said.
“They are coming in to explore the development and whether it’s feasible for us to launch a large collection of handbags,” Aaron said. “They are both well known and admired in the industry. It makes sense for us to hire expertise. We’ve always kept our options open.”
Aaron said it’s too early to conjecture whether any possible handbag collection will be under the Lambertson Truex label or Tiffany brand. While most of its business is in jewelry, the company known for packaging in its jewelry and other items in a blue box also has reached in other product categories, such as a licensed line of sunglasses.
Lambertson Truex filed for Chapter 11 bankruptcy protection in March after luxury shoppers across the board lowered discretionary spending. Its owner, Samsonite, put the brand up for sale in December, according to an article in trade paper Women’s Wear Daily.
Americans must prepare themselves for a massive collapse in the dollar as investors around the world dump their US assets, a former Bank of England policymaker has warned.
CHRISTOPHER COX The long-held assumption that US assets – particularly government bonds – are a safe haven will soon be overturned as investors lose their patience with the world’s biggest economy, according to Willem Buiter.
Professor Buiter, a former Monetary Policy Committee member who is now at the London School of Economics, said this increasing disenchantment would result in an exodus of foreign cash from the US.
The warning comes despite the dollar having strengthened significantly against other major currencies, including sterling and the euro, after hitting historic lows last year. It will reignite fears about the currency’s prospects, as well as sparking fears about the sustainability of President-Elect Barack Obama’s mooted plans for a Keynesian-style increase in public spending to pull the US out of recession.
Writing on his blog , Prof Buiter said: “There will, before long (my best guess is between two and five years from now) be a global dumping of US dollar assets, including US government assets. Old habits die hard. The US dollar and US Treasury bills and bonds are still viewed as a safe haven by many. But learning takes place.
” He said that the dollar had been kept elevated in recent years by what some called “dark matter” or “American alpha” – an assumption that the US could earn more on its overseas investments than foreign investors could make on their American assets. However, this notion had been gradually dismantled in recent years, before being dealt a fatal blow by the current financial crisis, he said.
“The past eight years of imperial overstretch, hubris and domestic and international abuse of power on the part of the Bush administration has left the US materially weakened financially, economically, politically and morally,” he said. “Even the most hard-nosed, Guantanamo Bay-indifferent potential foreign investor in the US must recognise that its financial system has collapsed.”
He said investors would, rightly, suspect that the US would have to generate major inflation to whittle away its debt and this dollar collapse means that the US has less leeway for major spending plans than politicians realise.