MILAN — Could an initial public offering be in the cards for Valentino? This is only one of the options that the Rome-based firm could choose from in the future — but not just yet.
As the fashion house continues to grow in size and reputation, expecting to hit the one billion euro, or $1.13 billion at current exchange, mark by the end of the year, Stefano Sassi, chief executive officer of the company, told WWD last month that this was “a symbolic turning point for us that will lead us to a new ulterior phase.”
That new phase rests on multiple options.
Asked at the time whether an IPO or the acquisition of other fashion brands could be possible in the future, Sassi declined to elaborate and pointed out that Valentino does not need a cash injection and that owner Mayhoola for Investments’ “interest in developing their presence in luxury” is a fact, depending on the opportunities.
On Friday, responding to a Bloomberg report speculating that Valentino was exploring an IPO, the company said, “The shareholders and management of Valentino confirm their total commitment to support and continue to grow the global presence of the brand.”
Mayhoola, the Qatar-based fund, “reconfirms their intention stated at the acquisition of Valentino in 2012 that the ambition and the plan is to build a successful platform for a luxury brands group. For that purpose, the growth plan of Valentino will continue to be the prime focus of the shareholders and the management. At the same time all means to proper establish and empower the financial structure of such luxury group is explored with our financial advisers including a public company structure without any decision at this stage.”
The Rothschild Group is Mayhoola’s adviser and declined to comment on the speculation.
Mayhoola has been enlarging its luxury portfolio, taking control of Italian men’s wear brand Pal Zileri and buying a stake in accessories label Anya Hindmarch.
At the time of the acquisition of Valentino, Mayhoola said it planned “to back management for the long term to exploit the full potential of this exciting brand. We believe Valentino is ideally suited to form the basis for a global luxury goods powerhouse.”
Sassi said Friday that Valentino, entirely supported by Mayhoola, “is focused on continuing this solid and qualitative process in a long-term perspective, targeting new levels of ambition and reinforcing the position of Valentino as a luxury brand.”
In September, Sassi for the first time revealed the group’s revenues in the first half of the year, revealing that sales jumped 59 percent to 478 million euros, or $530.6 million, compared with 301 million euros, or $412.3 million, in the same period in 2014. Last year, sales totaled 664 million euros, or $ 883.1 million.
In the first half, Valentino’s earnings before interest, taxes, depreciation and amortization climbed to 87.5 million euros, or $97.1 million, compared with 46.7 million euros, or $64 million, in the same period last year. Dollar amounts are converted from the euro at average exchange rates for the periods to which they refer.
EBITDA in the first half of 2011 totaled 9.3 million euros.
While Valentino revealing the figures might stir speculation that the company was doing so in order to stir potential investors’ interest, sources indicated no IPO appears to be imminent despite the Bloomberg report that stated one could take place as soon as early next year.
Sassi has been spearheading the expansion of the brand’s retail network, while also growing its wholesale accounts, opening up to new markets. Creative directors Maria Grazia Chiuri and Pierpaolo Piccioli have rejuvenated the brand, growing all product categories.
