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The Buzz on Tommy: No Rush for New CEO Nor for Acquisitions

Despite mounting pressure from Wall Street to name a new ceo and make acquisitions, Tommy Hilfiger feels he still has plenty of time to take action.

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He said part of the company’s men’s wear problem was agreeing to do too many products that department stores requested. “They were asking us to do things, and were asking other companies, too. We got caught in ‘same-itis.’ If a store said it needed more plaid shirts, we said, “OK,’ but that’s not what the customer wanted. The store would go to Nautica and Polo, too, and ask for the same things. During the last few years, you couldn’t tell the difference between Tommy, Polo and Nautica,” said Hilfiger.

In women’s wear, Hilfiger’s sister, Ginny, remains the muse. “She designs what she wants to wear and what the customer wants to buy. That’s one of the reasons it’s been so successful,” he said.

Hilfiger said his separate H line in men’s wear has done very well because it’s more sophisticated, more grown up and geared to Hilfiger’s specialty stores. “It has sold extremely well,” he said.

Turning back to acquisitions, Hilfiger said his investment bankers have presented him with a lot of different companies. “It’s like looking for a house. You can look and look and look, and when you walk into a house, you love how it feels and you know it’s right,” he said. One thing is certain: Hilfiger doesn’t want an acquisition that goes head-to-head with his company.

“I will not compete against my own brand. There is something out there, or there will be something that will be right. We have such a global presence and such a strong infrastructure in Europe. To buy something just for the U.S. market wouldn’t be the right fit. I’m not in a race to do this. I don’t have a deadline. Our cash is not going away. There’s more coming in. I want to make sure it’s the right thing for our shareholders and our corporation without neglecting Tommy Hilfiger because Tommy Hilfiger is an alive, breathing, strong brand that can continue to have opportunities.

“Will it have the kind of growth we had in the Nineties, when we were seeing gains of 25 to 30 percent, and 37 to 40 percent? No, never. If Tommy Hilfiger could get single-digit growth…It’s a very stable company,” he added.
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