Mar 8, 2011
Recent M&A in luxury goods sector
Mar 8, 2011
Mar 7 - French group LVMH is buying Italian jeweler Bulgari in a 3.7 billion euro ($5.2 billion) deal, signaling the possible return of big mergers and acquisitions in the luxury sector.
Bulgari "Heart" charm pendant in 18kt gold with diamonds.
Following are recent major deals in the luxury sector, starting with the most recent:
FERRAGAMO/HONG KONG'S PETER WOO
* Last week, Italian fashion house Ferragamo sold 8 percent of its capital to Hong Kong partner Peter Woo and his family and raised its holding in Chinese distribution firms but did not disclose details. Ferragamo is mulling a possible flotation.
* Last month, L Capital, the investment firm co-funded by luxury group LVMH, began exclusive talks to buy a stake in India's biggest jewelry retailer Gitanjali. The deal, reported to be $100-125 million, would give L Capital control of Gitanjali's branded jewelry and retail businesses.
GIANFRANCO FERRE/PARIS GROUP
* Last month, a source said Dubai-based high-end clothing retailer Paris Group was set to buy distressed Italian fashion house Gianfranco Ferre for an undisclosed amount. Paris Group plans to invest an initial 25 million euros to pay down debts and open 50 Ferre stores worldwide, the source said.
* Last month, Nordstrom Inc said it would acquire online luxury "flash sale" retailer HauteLook for $180 million.
* At the end of January 2011, Italian fashion house Prada kicked off a possible Hong Kong IPO which could value it at more than 6 billion euros. The group aims to raise at least 1.2 billion euros and seek a valuation of at least 12 times projected 2011 core earnings, in line with the luxury sector which is on 12.5 times.
* In October 2010, LVMH took the luxury world by surprise by announcing it had built up a 17.1 percent holding in Hermes. It later raised its holding to 20.2 percent.
* In December 2010, Li & Fung group's Trinity said it bought Cerruti for 53 million euros from U.S. fund MatlinPatterson which salvaged the Italian fashion in 2006.
* In summer 2010, Swiss luxury goods maker Richemont raised its interest in UK online fashion retailer Net-a-Porter to 90 percent from 33 percent for 234.5 million pounds. The deal valued Net-a-porter at a ratio of 2.9 times enterprise value to sales, at a slight premium to the industry on 2.7 times.
PHILLIPS-VAN HEUSEN/TOMMY HILFIGER
* In March 2010, Phillips-Van Heusen, owner of the Calvin Klein label, agreed to buy fashion brand Tommy Hilfiger from London-based Apax Partners for $3 billion in cash and shares. At the time, valuation was estimated at 8 times earnings before interest, taxes, depreciation and amortization.
* LVMH acquired luxury watchmaker Hublot in 2008 at a price which valued the business at 10 times 2008 earnings before tax or 400-450 Swiss francs.
* Permira bought Valentino Fashion Group and its majority stake in Hugo Boss in 2007 which valued it at 2.6 billion euros in a deal widely regarded as one of the most expensive in the luxury industry.
(Compiled by Silke Koltrowitz, edited by Astrid Wendlandt)
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