Warnaco Acquires Italian Franchise Operations (WRC)

The Warnaco Group, Inc. WRC today announced that it acquired twenty-two Calvin Klein Jeans retail stores and related assets from its largest Italian franchise partner, L'Innominato S.p.A, a part of the Percassi Group. These stores, which are located in leading shopping centers across Italy, are expected to generate approximately €28 million, or $38 million at current exchange rates, in revenues in fiscal 2011 and add over 50,000 square feet of new retail space to the Company's owned portfolio. Based on revenues, this transaction will establish Italy as the Company's largest retail market in Europe, with fifty-eight directly operated stores. The Company expects the transaction to be accretive to operating earnings in fiscal 2011.