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The 2007 Wharton Economic Summit ::
Panels



Private Equity and Mergers and Acquisitions in Retailing
Sponsor: Jay H. Baker Retailing Initiative of the Wharton School
Moderator: William Cody, Lecturer in Marketing; Managing Director, Baker Retailing Initiative
Panelists:  Gilbert W. Harrison, Esq., John M. Roth, Jennifer Doré Russo
Thursday, April 12 - 4:30 p.m.-5:30 p.m. :: Full Summit Schedule

Some business historians point to Robert Campeau's failed acquisitions of Allied Stores and Federated Department Stores as the straw that broke the back of the junk-bond market and the boom of LBO's in the 1980's. For over a decade, leveraged investments in retail trailed off significantly as banks and private equity firms saw retail as a risky bet. However, just like the styles of the '80s, retail is again in fashion for acquisitions and buyouts.

The stellar returns of ESL Investments' Sears Holdings, a then-unthinkable combination of Sears and K-Mart, have contributed to an increased interest and level of creativity in retail deals. Since 2005, private equity firms are aggressively targeting the retail sector for major investments. Today's panel will discuss what's in store for retail deals in the coming months and offer insights on avoiding the perils that ultimately bankrupted Campeau and Federated in 1990.

Panelists
:: Gilbert W. Harrison, Esq. , W'62, L'65
   Chairman
   Financo Inc

Gilbert W. Harrison is the chairman of Financo, Inc., a New York-based investment banking firm specializing in providing merger and acquisition, financial restructuring, and other financial advisory services on a global basis to the "merchandising" sector.

During the last 36 years, Mr. Harrison and his team have orchestrated hundreds of merger, acquisition and divestiture deals for retail, apparel, footwear and cosmetic clients. As one of the industry's premier dealmakers, Mr. Harrison has recently put together some unique financial transactions in the merchandising industry including Limited Brands acquisition of La Senza Corporation, Phillip Van Heusen's acquisition of Superba, Alticor's acquisition of Laura Mercier from Neiman Marcus Group, Li & Fung's acquisition of the Womenswear Division of Oxford Industries, Nordstrom's acquisition of Jeffrey Inc., Bear Stearn's minority stake in Stuart Weitzman, Iconix's purchase of Joe Boxer and Mossimo, Inc.

Past and present clients of Financo include American Eagle Outfitters, Inc., Apollo Management, BCBG Max Azria, Bear Stearns Merchant Banking, Benckiser, Cache, Inc., Casual Corner Group, Inc., Coty Inc., CVS (Melville) Corporation, El Corte Ingles, S.A., Federated Department Stores, Inc., Gap, Inc., Gloria Vanderbilt, Gruppo Andre, Gruppo Coin, Investcorp International Ltd., Itochu Corporation Ltd., Kellwood Company, Kingfisher plc, Kmart Corporation, Li & Fung, L'Oreal USA, Inc., Maus Freres, Mercury Group, Mothers Work, Inc., Neiman Marcus Group, Next, plc, Pentland, plc, Revlon Inc., Schottenstein Stores Corporation, Sears plc, Signet, plc, Stuart Weitzman, Syms Corporation, Tang's Department Stores, Texas Pacific Group, The Limited, U.S. Shoe Corporation, V.F. Corporation, Warnaco Inc., Zales Corporation and other domestic and international clients.

Mr. Harrison's other activities include creating a course on mergers and acquisitions at the Wharton School; publishing various articles and academic studies on the state of retailing and mergers and acquisitions, including a chapter in the book entitled, "The Mergers and Acquisitions Handbook"; and lecturing throughout the country, including chairing seminars for Retail Week as well as for the International Council of Shopping Centers, the National Retail Federation, Young President's Center, Wharton's Aresty Institute of Executive Education and The President's Association of the American Management Association.

Mr. Harrison received a Bachelor of Science in Economics from the Wharton School of the University of Pennsylvania in 1962 and his Juris Doctor from the University of Pennsylvania Law School in 1965. From 1965 through 1971, he practiced corporate and securities law in New York and Philadelphia. He is admitted to the bar in Pennsylvania, New York, Connecticut and Florida, and is a member of the American Arbitration Association.

Mr. Harrison is on the Board of the Educational Foundation of the Fashion Institute of Technology, the Peggy Guggenheim Collection of the Solomon Guggenheim Foundation, the Penn Club of New York and the Foundation of Southampton Hospital. He also served the Wharton School Undergraduate Advisory Board of the University of Pennsylvania for 18n years.

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:: John M. Roth , WG'80
   General Partner
   Freeman Spogli

Mr. Roth joined Freeman Spogli in 1988 and became a General Partner in 1993. Prior to joining the firm, he served as a Vice President in the Mergers and Acquisitions Department of Kidder, Peabody & Co. Incorporated. From 1983 to 1984, Mr. Roth worked as a management consultant with McKinsey & Company, Inc. He was employed by Dean Witter Reynolds Inc. in the Investment Banking Division from 1980 to 1983.

Mr. Roth graduated summa cum laude from the Wharton School of the University of Pennsylvania with a bachelor's degree in accounting, and earned his master's degree in business administration in finance from Wharton in 1980.

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:: Jennifer Doré Russo , W'91
   Sonenshine Partners

Jennifer Doré Russo joined Sonenshine Partners in 2004. She has close to 15 years of experience in investment banking and private equity and has advised companies across a broad spectrum of development with a particular focus on the retail and consumer sectors.

Most recently, Ms. Russo was a director at Counsel Corporation, where she was responsible for restructuring and exiting underperforming portfolio investments in the consumer, healthcare, and other sectors. Previously, she was a principal at investment banking firm Roth Capital Partners, where she advised and financed early stage companies. Prior to joining Roth, Ms. Russo was a vice president at Solomon Smith Barney (now Citigroup) in London. At Salomon Smith Barney, she was a founding member of the European financial entrepreneurs group, advising private equity firms on investments in the consumer, retail and other sectors. Ms. Russo began her career at the Blackstone Group.

Ms. Russo graduated summa cum laude with a BS in Economics from the Wharton School of the University of Pennsylvania, where she was a Benjamin Franklin Scholar. She is on the Business Steering Committee of the Arts & Business Council of New York, a member of the Advisory Board of Pentacle, and organization supporting dance community, and the Treasurer of the Tabard Alumnae Network.

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