Active Apparel Group, Inc. to Acquire Everlast
Plans Call for Combined Entity to Become World Class Sports and
Marketing Company
Active Apparel to be Renamed Everlast Worldwide
NEW YORK, Aug. 22 -- Active Apparel Group, Inc. (Nasdaq: AAGP - news), today
announced that it will acquire Everlast, the foremost brand in boxing and among
the leaders in other sports. In a stock and cash deal valued at about $60
million, Active Apparel Group will acquire the privately held company. As a
result of the acquisition, Active Apparel, which will be renamed Everlast
Worldwide, will own all worldwide licensing rights to the prominent brand as
well as the company's production facilities in The Bronx, New York and Moberley,
Missouri. The deal, which should close before the end of the year, will be
immediately accretive to earnings.
Founded in 1910, Everlast soon became one of the most widely recognized
athletic brands in the world and has become virtually synonymous with boxing.
Many noted and legendary boxers such as Joe Louis, Jack Dempsey, "Sugar" Ray
Robinson, George Foreman, and Evander Holyfield have won and defended their
championships in Everlast trunks and gloves. To this day, Everlast has leveraged
this allegiance to capture market share. In 1999, Everlast products accounted
for 8 of the top 10 selling boxing equipment products -- over 50% of bag, glove
and accessory sales, and over 80% of protective equipment sales. At the retail
level, Everlast brand equipment and apparel has generated over $200 million in
annual revenues.
"The opportunity to acquire a brand name on a par with Everlast is
quite rare. It is a brand rich in heritage and one that possesses an incredible
degree of consumer awareness. In a sense, it is like owning a piece of American
history. We think of Everlast as a world class brand; one that can easily stand
along side the likes of the major brands in the activewear and sporting goods
markets," said George Q Horowitz, Active Apparel's chairman, president and chief
executive officer. "We are excited that our two companies, who've shared over
eight years of successful partnership, can now take this relationship to the
next level. The
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synergies of this combination will benefit our shareholders in that they now own
a company that has nearly twice as many revenues, is profitable and infinitely
more prominent. But most of all, consumers will benefit from increased
availability of Everlast brand equipment, apparel and accessories at an
increasing number of retail locations."
A highly synergistic addition to Active Apparel's product lines,
Everlast will introduce Active Apparel to its customers and vice versa. Over
3,500 retailers sell Everlast equipment and apparel, including Gart's, The
Sports Authority, Big 5 Corp., Modell's, Inc. and Dick's Sporting Goods, many of
which already have strong relationships with Active Apparel.
"George Horowitz and Active Apparel have been valuable partners since
we introduced Everlast women's apparel in 1992," said Ben Nadorf, who became a
joint owner of Everlast in 1958 and sole owner and president in 1995.
"Understandably, quite a few companies were interested in acquiring Everlast,
but I felt most comfortable handing the reins over to George. His closeness to
the company and his understanding of our brand dynamics and vision were chief
considerations in our decision to consummate this deal. As a licensor, we have
watched George build Active Apparel into a dynamic and highly successful
company. We are confident that under George's care and management, Everlast will
continue to thrive and increase in popularity."
Upon completion of the acquisition, Mr. Horowitz will serve as Chairman
and Chief Executive Officer of the combined entity. Mr. Nadorf will remain with
the company and serve as President of the Everlast Sporting Goods Division.
Following the close of the acquisition, Active Apparel will introduce a
new strategy aimed at realizing the synergistic benefits of the two companies.
Active Apparel will primarily endeavor to increase the number, scope and global
presence of its licensing arrangements. While opening new international markets,
the company will seek licensing arrangements for the introduction of new, high
quality products utilizing the Everlast name. Active Apparel will also look to
leverage Everlast's production capabilities to introduce new equipment and
accessories. In addition, the acquisition will transfer ownership of the
http://www.everlast.com domain to Active Apparel, the prominence of which the
company will leverage to expand its primary e-commerce marketing initiatives.
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About Active Apparel Group, Inc.
Headquartered in New York City, Active Apparel Group, Inc. is a
designer, marketer and supplier of women's and men's activewear, sportswear, and
swimwear. The Company sells its product collections under the Everlast brand
name in addition to other exclusive licensing arrangements. The Company's
products are manufactured by third party independent manufacturing contractors
and are sold to over 20,000 retail locations throughout the United States and
Canada, including a variety of department stores, specialty stores, catalog
operations and better mass merchandisers. Active Apparel's Web site can be found
at http://www.everlastusa.com.
About Everlast
Founded in 1910, Everlast World's Boxing Headquarters Corp. is the
preeminent brand in the world of boxing and is among the most dominant brands in
the overall sporting goods and apparel industries. Over the past 90 years,
Everlast products have become the "Choice of Champions(TM)", having been used
for training and professional fights by many of the biggest names in the sport.
Everlast is the market leader in nearly all of its product categories,
responsible for leading eight of the top ten boxing equipment products in sales.
In addition to producing and marketing the equipment and accessories, Everlast
licenses its brand to providers of men's and women's sportswear and active wear,
children's wear, footwear, watches, cardiovascular exercise equipment and
gym/duffel bags. At the retail level, Everlast's licensed products generate over
$200 million in revenues.
This release contains forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ materially from those
anticipated in these forward-looking statements. Factors that may cause such
differences include, but are not limited to, the Company's expansion into new
markets, competition, technological advances and availability of managerial
personnel.
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