Roberto Cavalli Pre-Fall 2019

MILAN — Merger and acquisition talk around the Roberto Cavalli brand is heating up.

According to market sources, around 10 “interested parties” have made contact with Rothschild, the adviser tapped by Cavalli’s owner, Italian private equity fund Clessidra SGR , to find a buyer for a stake in the company. OTB is said to have also been interested and “made contact,” but sources said the group, founded by Renzo Rosso, may have not actually submitted an offer. One source said the group is “not in pole position.” OTB is parent of brands Diesel, Maison Margiela, Marni, Paula Cademartori, Viktor & Rolf, Brave Kid and Staff International, which is Just Cavalli’s licensee — a possible reason for OTB to look at Cavalli.

Sources say Tapestry Inc., parent company of Coach, Stuart Weitzman and Kate Spade, has looked at Cavalli’s dossier, without submitting an offer. As reported, Tapestry may be eyeing possible M&A targets and has not ruled out looking overseas for the company’s next transaction.

An unidentified Chinese fund is also said to be interested. Rothschild and Clessidra had no comment on Friday.

Clessidra took control of Cavalli in 2015, but has been looking to exit the fashion business, according to sources. In May 2016, Italmobiliare SpA, the publicly listed investment group owned by the Pesenti family, took control of Clessidra for roughly 20 million euros. Italmobiliare holds and manages a diversified portfolio of investments and equity interests worth more than 2 billion euros.

Clessidra is open to bringing on investors to inject fresh capital and expand the brand, which is designed by Paul Surridge.

Chief executive officer Gian Giacomo Ferraris has spearheaded the turnaround of Cavalli since his arrival in May 2016. Last month, presenting a new residential project in Bahrain, Ferraris said the company needs further investments to compete in the current scenario.

In October, Ferraris also unveiled a partnership with Dico International, the strategic investment arm of the Dubai-based Damac property developer, to open its first hotel in 2023 in Dubai and called Aykon — the first of at least five hotels in 10 years.

In the 12 months ended Dec. 31, Cavalli revenues were down 1.8 percent to 152.4 million euros, compared with 155.2 million euros in 2016. Ferraris expects the company to reach operating profitability this year.

When Clessidra bought Cavalli, financial details were not disclosed, but market sources estimated that the brand was purchased for between 380 million euros and 400 million euros. The deal was completed by a newly established company called Varenne, controlled by Clessidra but including L-GAM and Chow Tai Fook Enterprises Ltd.

Founder and designer Roberto Cavalli himself retains a 10 percent stake in the firm, but he has eased out of the fashion industry.

load comments
blog comments powered by Disqus