Gores Group doubles down on deals

The Los Angeles-based private equity firm’s two acquisitions are consistent with the focus of its third fund, which closed on $2bn earlier this year.

The Gores Group has agreed to a pair of transactions in the last two days, acquiring Clark Holdings and entering a joint venture for a majority of Mexx.

Gores will pay $85 million in cash for an 81.25 percent stake in Mexx, a fashion business owned by Liz Claiborne. Liz Claiborne will maintain an 18.75 percent share of the company, which will retain its current management. The deal includes a $60 million asset-backed debt facility that is expected to be assumed by the joint venture and refinanced at closing.

The firm also entered an agreement to purchase Clark, a logistical services provider for the print media industry, for 46 cents per share. The per-share price is a 171 percent mark-up on the company’s 1 September closing prices. The transaction has been approved by Clark’s board of directors and will close upon the approval of the company’s shareholders.

The deals are consistent with the firm’s target acquisitions for its third fund, which closed on $2 billion in February. Gores Capital Partners III will complete 12 to 20 transactions, investing $50 million to $250 million in distressed companies in the information technology, telecom, industrial, media, healthcare and security sectors.

Gores could not be reached for comment at press time.

The firm’s 2007 second fund has generated an 11.22 percent internal rate of returns since inception as of 30 September, 2010, according to documents from the California State Teachers’ Retirement System.

Gores was founded in 1988 by Alec Gores and has $4 billion in equity under management, according to its website. The firm maintains offices in Los Angeles, London and Boulder, Colorado.