FAST FIX AT J. CREW: KEY INVESTOR OUSTS CEO AT DEBT-HEAVY CATALOGER; SEEKS OPERATIONS EXPERT, STRONGER FOCUS ON STORES.

Crain's New York Business, January, 1999 by Curan, Catherine

The sudden departure of J. Crew Chief Executive Howard Socol after less than a year on the job signals that majority shareholder Texas Pacific Group is unhappy. While J. Crew Group Inc.'s cash flow has improved recently, it's unclear whether the company can cover the huge debt it took on when TPG purchased an 85% stake for $560 million in October 1997.

Mr. Socol's exit is also likely to delay the company's hoped-for public offering. "TPG overpaid for the company, so the pressure is on," says Janet Kloppenburg, analyst at BancBoston Robertson Stephens. The executive turmoil is likely to make a turnaround for the retailer and catalog company even more difficult. The CEO slot is expected to be tough to fill, given J. Crew's history of high turnover caused by...

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