Jamie Salter’s company owns the rights to Elvis Presley and Marilyn Monroe’s vast estates, as well as controlling the brands of David Beckham and Shaquille O’Neal. But cracks are starting to emerge.
If vague soundbites and warm words alone were enough to ensure the long-term survival of a well-known retailer then Ted Baker might still be a feature of the British high street.
Authentic’s “deep industry knowledge” would “enhance Ted Baker’s revenue and profitability”, it pledged. “People thought the value of a bankrupt brand was zero,” Salter said in a recent interview. “But why would it be zero? So I came up with a strategy to put a value on it.” ‘He has short-man syndrome – he doesn’t listen but he talks at a thousand miles an hour. The first time we met him he spent the first 15 minutes telling us how wonderful he was.’His big breakthrough came in 2006 when he convinced Jeffrey Hecktman, founder of distressed investment giant Hilco Global to launch a venture that would buy disowned IP on the cheap and resurrect the bankrupt brands through lucrative licensing agreements.
Others have claimed Lady Gaga took personal offence at something Salter said to her that night and demanded that he face the axe. Authentic paid £211 million to acquire Ted Baker, a figure restructuring specialists say was far too high for an outfit that had notched up more than £150 million of losses over the previous two years. “They overpaid,” said one.
Authentic’s strategy chief John McNamara has laid the blame at the door of AARC, a little-known Dutch company that was selected to run Ted Baker’s UK shops. Throw in the combined revenue of its closest rivals WHP, Marquee Brands, Bluestar and Iconix, and the licensing industry has mushroomed from a $US5 billion market into a roughly $US50 billion one in just five years. Senior figures believe it could double in size again over the same time frame.Its ownership of American magazinehas descended into a bitter court battle with the licensee Arena after it failed to make a $US3.75 million quarterly payment to Authentic.
The setbacks point to an organisation in a hurry. Sceptics say the nature of the Authentic model, which is reliant on snapping up troubled businesses in need of cash, means there is a need for Authentic to keep adding to its haul. Tension may be building elsewhere too. As Authentic has grown, Salter’s lifestyle has increasingly mirrored that of the celebrities he’s teamed up with.
But the sudden disappearance of Ted Baker shops from the British high street threatens to cast a long shadow over Salter’s empire-building.“A true friendship, the best family values and the hardest working person – next to me of course,” a post from Salter posted on David’s birthday in May read.
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