Partner May Help Parlux Divest Product Lines

2006-09-14 | 10:30

Parlux Fragrances has hired a business planning company to help it sell certain non-core product lines.In a Securities and Exchange Commission filing on Monday, the Fort Lauderdale-based fragrance company said Aventura-based GLMAC will work for the next six months, renewable month-to-month thereafter, unless terminated earlier, to be its exclusive facilitator and adviser to sell certain properties.

Parlux pointed out Aventura-based GLMAC was the intermediary for its letter of intent to sell its Perry Ellis fragrance business.

Parlux also said GLMAC's managing director, Lucien Lallouz, has provided valuable assistance to Parlux in the past in securing its Guess, Paris Hilton and Maria Sharapova licenses.

For their newest work together, the SEC statement shows GLMAC has agreed to evaluate market opportunities, identify potential buyers and determine maximum realizable value for the properties Parlux may sell.

If GLMAC introduces a potential buyer to Parlux, GLMAC is to execute final agreements.

Upon the successful conclusion of a transaction acceptable to Parlux's management and its board, the company is to pay GLMAC 3 percent of up to $50 million received by Parlux, 2 percent of the subsequent $50 million received by Parlux and 1 percent of amounts exceeding $100 million received by Parlux.

Parlux agrees if, during GLMAC's contract with it, GLMAC introduces it to a potential buyer and no agreement is reached, Parlux will pay the fees to GLMAC if a sale is consummated with the same potential buyer within six months after the termination of the agreement.

Ilia Lekach, Parlux chairman and chief executive officer, said the company continues to pursue new fragrance licenses and to concentrate its efforts on its fast-growing fragrance properties.

"We currently have a number of product lines that have been successful but do not have the upside as other potential opportunities available to us," he said. "We expect the sale of the non-core licenses will be cash-flow positive and provide funding for potential new fragrance ventures."

Among other licenses, Parlux holds the fragrance brands for Perry Ellis, Guess, XOXO, Ocean Pacific, Maria Sharapova, Andy Roddick, babyGund, and Fred Hayman Beverly Hills, as well as Paris Hilton fragrances, watches, cosmetics, sunglasses, handbags and other small leather accessories.