By  on May 29, 2007

MILAN — Bulgari SpA has sold off part of its stake in private equity firm Opera.

Italian investor Michele Russo bought a 75 percent stake in Opera's two management companies, Opera Management SA and Opera SGR SpA, from Bulgari and Opera management, the parties said Thursday in a joint statement. The transaction price was not disclosed.

Bulgari and Opera's management, including former Opera chief executive Renato Preti, will retain a collective stake of 25 percent in the companies. Prior to the Russo transaction, Bulgari held 50 percent of Opera while Preti and other investors controlled the other 50 percent.

Russo is the new chairman and ceo of Opera's management companies. He has tapped Emmanuel Micheli as Opera's new operations manager. Preti will remain a part of the management team, the statement said.

"In light of the important investments Bulgari is realizing worldwide both in production and distribution, and the demanding challenges the company is successfully tackling in the increasingly competitive luxury market, we have decided to sell the majority stake of Opera as we believe that the company does not represent a strategic investment for the Bulgari Group anymore," Bulgari ceo Francesco Trapani said in the statement.

"We still continue as shareholders and therefore we are satisfied with the entrance of Michele Russo, who owns the right competencies to be a strong investor and manager," he said.

Bulgari has been considering selling its Opera stake for months. Last November, Trapani said the company was engaging in talks with prospective investors.

Russo, 45, founded Doughty Hanson & Co.'s Italian branch and managed the equity firms' Italian transactions from 1997 to 2004. He has also worked at IBM Corp., Morgan Stanley and Olivetti SpA.

Bulgari and Preti founded Opera in 2000 during the luxury goods mergers and acquisitions boom.

But the fund has had a mixed track record with its acquisitions, which totaled more than 180 million euros, or $242 million at current exchange rates. Most notably, Opera had a tough time turning around footwear brand Bruno Magli and watch company Sector.

Opera has sold off all of its investments save two: a minority stake in San Francisco-based gourmet retailer A.G. Ferrari Foods and a controlling interest in home furnishings company B&B Italia. Opera said that the "equity commitment" of Opera's portfolio is more than 300 million euros, or $403.4 million.Opera sold Sector to jewelry company Morellato SpA late last year for 45 million euros, or $56.4 million. U.K.-based investment fund Fortelus Capital bought Bruno Magli in February for an undisclosed sum.

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