MILAN — The Ermenegildo Zegna Group continues to beef up.
The Italian men’s wear company has inked an agreement to buy a majority stake in Dondi Group. Based in Carpi, outside Modena — one of Italy’s main textile and knitwear hubs — Dondi is a leading manufacturer of high-quality jersey fabrics for men and women, all made in Italy.
As part of the deal, the Dondi-Capelli family will maintain a 35 percent stake in the company and continue to be responsible for running the business and its creative management. Financial details were not revealed.
“It is an investment geared toward heightening direct control of the textile supply chain, which features a variety of products, all made entirely in Italy,” said Gildo Zegna, chief executive officer of the Trivero, Italy-based group. “We have had business relations with the Dondi Group for some time now, and the family history is in many ways similar to our own, starting with their profound respect for corporate autonomy. I feel sure that together we will not only be able to pursue challenging goals, but we will also enhance the value of Made in Italy.”
Founded by Lauro and Edda Dondi in 1970, Dondi is now led by their children Lorella and Stefano, who touted how the company’s “consolidated technical and style know-how has allowed us to develop a broad range of high-quality fabrics, which have proven successful with the biggest fashion houses here and abroad. Like Zegna, we, too, believe in tradition, in the intrinsic excellence of Italian products, and in building a highly specialized textile supply chain structured around quality and innovation.”
The agreement helps Zegna strengthen its standing in women’s fabrics and further develop its textile supply chain, which previously comprised Lanificio Zegna, Lanerie Agnona and Tessitura di Novara, raising its position in the country in terms of variety and size.
The acquisition follows that of a majority stake in Bonotto SpA, a high-end textile manufacturer based in Molvena, near Vicenza, in 2016. The Bonotto family continues to own a 40 percent holding and had remained in charge of management and creative direction. Gildo Zegna said at the time that the agreement was strategic rather than financial that would help expand the group’s informal fashion component and give input into Agnona’s women’s wear — another brand controlled by his family’s group.
At the end of last August, Zegna revealed the acquisition of an 85 percent stake in Thom Browne from Sandbridge Capital for an enterprise valuation of about $500 million, which was entirely self-financed. At the beginning of 2018, the Zegna group further strengthened its creative offer and production capacity by finalizing the acquisition of a controlling stake in Pelle Tessuta, a company specialized in the weaving of leather. These topped the acquisition a year earlier of a minority stake in India’s luxury men’s wear firm Raghavendra Rathore Jodhpur, partnering with Reliance Brands Ltd., and of Cappellificio Cervo, a historic men’s hat brand based in Biella.
As reported in April, the Zegna group saw an uptick in net profits last year, as it sets the foundations for further growth, strengthening its omnichannel approach and continuing to build its main market, China, while investing in other key regions, including the U.S. and South East Asia.
In the 12 months ended Dec. 31, net profits rose 3.6 percent to 34 million euros, on the back of revenues that declined 2 percent to 1.16 billion euros. At constant exchange, sales inched up 0.4 percent.