Hanna Andersson, Gerber Childrenswear Sold

Private equity firm Sun Capital Partners announced Nov. 25 that one of its affiliates, Childrenswear LLC, acquired children's clothing cataloger/retailer Hanna Andersson Corp. and Gerber Childrenswear for $179 million.

Hanna Andersson and Gerber Childrenswear will each operate as standalone businesses within the Childrenswear entity. Combined, Gerber Childrenswear and Hanna Andersson generated $267 million in net sales for fiscal 2007, and $218 million the first nine months of fiscal 2008.

Founded in 1983, Hanna Andersson specializes in Swedish-inspired cotton kid's apparel. The Portland, OR-based business now includes a catalog, 23 retail stores, six outlet stores and a Website. Apparel marketer Kellwood Co. bought Hanna Andersson for about $175 million in June 2007; Sun Capital then acquired Kellwood—on its third attempt—in February 2008.

“As a standalone entity, Hanna Andersson will be better able to focus on improving our products and expanding channel opportunities, as well as moving quickly in a challenging retail environment,” Hanna Andersson CEO Philip Iosca said in a statement.

Lee Helman, managing director for investment firm Financo, says Sun Capital took Kellwood private and “spun out Gerber and Hanna to be a separate company (Childrenswear), as they are distinctly focused on children, while the remainder of Kellwood is not focused on children.”

The transaction is a “reorganization of its portfolio into trading groups,” says Stuart Rose, managing director for investment firm Tully & Holland. The move enables Kellwood to now focus on women’s apparel, while Sun Capital “gets a full operating group focused on children’s,” he says.