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After Tense Tapestry Exit, Former CEO Jide Zeitlin Returns to Consumer Spotlight

Jide Zeitlin and Lew Frankfort are latest to get into the SPAC game.

Zeitlin, former CEO of Kate Spade owner Tapestry, and Frankfort, a onetime chief executive at Coach, bring their product and consumer knowhow together in Bleuacacia, a so-called “blank check” firm, or special purpose acquisition company, looking to raise $300 million in an initial public offering to buy millennial and Gen Z-focused brands, according to a Securities and Exchange Commission (SEC) filing.

SPACs have become the new way to go public, enabling companies to bypass the typical six-month investor roadshow and go to market quickly.

Earlier this year, KKR & Co. linked up with former Gap chief Glenn Murphy to raise $1.2 billion through KKR Acquisition Holdings I Corp, with Simon Property Group later former Simon Property Group Acquisitions Holdings to raise $300 million and invest in “growing companies at the intersection of retail and technology that drive forward innovative consumer experiences.” Next, ex-Gap CEO Art Peck birthed Good Commerce Acquisition Corp. to raise $200 million and acquire apparel and other brands with “business models for tomorrow” that “sit on modern, nimble technology, government documents said.

Carbon negative materials firm Origin Materials Inc., a SPAC, just completed its planned combination with Artius Acquisition Inc. earlier this month. SPACs usually have 18 to 24 months to find a company to buy, or risk having to repay investors.

Because SPACs don’t have operations to show investors when they set out to raise capital, much of the decision to invest rests on the management teams behind the SPAC. And in that regard, the SEC filing addressed Zeitlin’s sudden resignation from Tapestry in July last year over alleged misconduct that occurred 13 years before his tenure, including his time as a board member. The document said his exit was “related to a personal consensual relationship” that happened over 12 years ago and was “unrelated” to his duties at Tapestry or any other company. More importantly, the SEC filing noted that the “legal due diligence conducted in anticipation of this transaction” did not reveal any other information that would disqualify him from filling the CEO role.

Both Frankfort and Zeitlin will act as Bleuacacia co-CEOs, with Charles McGuigan, L Brands’ recently retired chief operating officer, taking the role of president and chief operating officer. The co-chiefs’ history dates back to the mid-1990s, when Zeitlin, through his was work at Goldman Sachs, became Coach’s financial advisor and helped Frankfort take the leather goods brand public in 2000. Zeitlin and McGuigan have known each other for over five years, documents said. Once the public offering is completed, both Frankfort and Zeitlin will become co-chairman of the board.

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Bleuacacia is looking for businesses with strong growth potential, high barriers to entry, robust recurring revenues, sustainable operating margins and lucrative free cash flow dynamics. More importantly, Bleuacacia said it plans to focus on businesses where the co-chiefs can leverage their background and experience with premium consumer-facing brands to drive shareholder value.