MILAN — OVS is securing a future for the Stefanel brand.
On Monday, the Italian retailer said the Ministry of Economic Development has approved the acquisition of the financially troubled company and some related assets, including 23 stores and the collection archive.
OVS will also hire employees working in the stores and the headquarter in Ponte di Piave, Italy, mainly dedicated to product development.
As reported, OVS chief executive officer Stefano Beraldo said last month OVS was in exclusive negotiations to acquire Stefanel and that he was hoping the deal could be sealed in January. OVS, which operates the OVS and Upim store networks, revealed a capital increase of up to 80 million euros aimed at supporting potential M&A activities.
OVS in December said the offer totaled 3.2 million euros.
Beraldo touted the potential of the Stefanel brand, which he believes relies on a strong and positive image, strength in women’s wear and in particular in knitwear, which he sees as an added asset at a time when working from home has heightened interest in comfort dressing. This will be a stimulus to improve OVS’ own offer in that category, and the retailer’s sourcing capacity will boost Stefanel’s production, he said. “This will allow us to raise the range of OVS prices by 30 to 50 percent and lower Stefanel prices by 30 percent,” Beraldo explained at the time.
The company said in Monday’s statement that it had been working for weeks on defining the structure of the assortment and its style, defining it as “easy to wear, contemporary, characterized by high-quality materials and with a prevalence of the knitwear component. Thanks to our industrial platform and sourcing organization, a high-quality price ratio will be offered, which is not easy to find in the market. The relaunch of the brand will benefit not only from industrial but also from commercial synergies, leveraging on a multichannel strategy.”
OVS pointed to the opening of new stores, and the digital channel will also be a priority, in Italy and abroad.
OVS has guaranteed Stefanel employees currently working in the headquarter the possibility to join the OVS headquarter in Mestre, around 18 miles away from Ponte di Piave, “as soon as possible and in any case within the 12 months following the acquisition.” The personnel of the acquired stores would remain in retail roles.
Stefanel was launched in the contemporary market segment in 1980 as the private label of the Maglificio Piave knitwear manufacturer established in 1959 by Carlo Stefanel. After changing hands a few times and a number of financial issues, Stefanel entered a special administration procedure in September 2019, and a year later, the company was delisted from the Milan Stock Exchange amid declining sales, increased debts and a deteriorating economy.
In the third-quarter last year, OVS sales totaled 361 million euros, up 6.1 percent compared to the same period in 2019, while EBITDA amounted to 38.1 million euros substantially in line with the same period a year earlier.