Isaac Mizrahi is about to make a serious chunk of change. According to WWD (subscription required), Mizrahi sold his company, IM Ready-Made LLC, to Xcel Brands--And is set to receive a whopping $31.5 million at closing.
The designer has also inked a lucrative earn-out arrangement, which calls for an additional amount up to $32.7 million in cash or stock to be doled out over a four-year period, if Mizrahi meets certain minimums in royalties. What's more, WWD estimates that Mizrahi will earn roughly a cool $10 mill each year. Now that's certainly nothing to sneeze at.
This is the latest development in Mizrahi's long and, at times, bumpy career, which has so far included four backers, and several collaborations including a Target line, which WWD estimated at grossing $300 million a year, and a stint as creative director at Liz Claiborne. As for Xcel Brands, the CEO Robert D’Loren, whose previous company NexCen Brands Inc., acquired and then sold Bill Blass, has in the past fallen under scrutiny for some shady business dealings, even coming under investigation by the Securities and Exchange Commission, though no action was taken.
But the past is, well, the past. And Mizrahi, for one, is excited for the future. “We’ve spent nearly a year working closely with Bob D’Loren and look forward to joining him at Xcel," he told the paper. "I’m pleased to be such a significant shareholder in the company, and believe that we are poised for growth.”
There is one sad spot in this whole merger though: According to WWD, "Mizrahi’s high-end Collection line, not part of the Xcel acquisition, will likely be phased out and repositioned as a licensing business." Which probably explains why the designer decided not to show this season.
But if there's one thing watching Mizrahi's career path has taught us, it's to expect the unexpected. Needless to say, we'll stay tuned.