Polo Ralph Lauren Corporation (NYSE:RL) today announced that on July 2, 2004, it completed the acquisition of certain assets of RL Childrenswear Company LLC, its licensee for childrenswear in the United States, Canada and Mexico.
The purchase is a cash transaction for approximately $240 million with contingent and deferred payments, not to exceed $20 million, over the next three years. As previously announced, the transaction is expected to be neutral to Polo Ralph Lauren's earnings in Fiscal 2005, after taking into account the elimination of licensing royalties from the children's business upon closure of the transaction. The Company expects wholesale revenues in the first full year of operation in Fiscal 2006 to be more than $200 million with earnings per share expected to be accretive in the range of $0.15 to $0.20.
