MILAN — Roberto Cavalli has called off the sale of his namesake fashion label because of market conditions.
The designer told the Italian financial daily Il Sole 24 Ore that valuations of his business based on current earnings multiples fell short of his expectations, and he will not revisit a possible sale before 2009.
“I’m not selling the company,” Cavalli said in the Il Sole interview. “The timing is not ripe yet for such a step. What’s more, as I have already said a thousand times, we don’t need [to sell].”
Merrill Lynch, which was advising on the sale, valued the company at 1.4 billion euros, or $2.19 billion at current exchange — almost 17 times earnings before interest, taxes, depreciation and amortization of around 84 million euros, or $115 million at average exchange, in 2007.
Luxury and fashion companies listed in Europe are trading on average on an EV/EBITDA multiple of 8.9.
Private equity funds Candover, Carlyle, Doughty Hanson, Lion Capital, and Texas Pacific were among those expected to table binding bids in the second round of the auction next week.
“A year ago, [the banks] spoke to me about certain numbers, which today have vanished with the stock market crisis,” Cavalli told Il Sole. “I’m not selling for 800-900 million [euros].”
A spokeswoman for Cavalli declined to comment Tuesday.
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