OVS Milan

MILAN — OVS SpA is aiming at building its store network outside Italy by investing CHF 14.1 million, or $14.3 million at current exchange, to acquire a 35 percent stake in Sempione Retail AG.

The latter announced on Monday an all-cash public tender offer for publicly held shares of the Swiss apparel retailer Charles Vögele Holding AG at a price of CHF 6.38, or $6.50, per share.

Charles Vögele reported sales of CHF 800 million, or $815.6 million, in 2015 and comprises approximately 760 stores in seven European countries.

After the public tender offer has been completed, Charles Vögele will enter into a cooperation agreement with OVS to introduce the OVS brands and merchandising in Switzerland, Austria, Slovenia and Hungary through a defined conversion plan over 18 months following the acquisition. Charles Vögele will grant royalties to OVS.

The business in Belgium is currently under disposal and, after the completion of the offer, Charles Vögele Germany will be, for the largest part, sold to a European retailer.

“Building upon its successful track record of store network conversions, OVS will combine its relevant apparel know-how and retail expertise with Charles Vögele network and knowledge of its markets,” said OVS chief executive officer Stefano Beraldo. “We have carefully analyzed Charles Vögele’s network and merchandising and we believe that in the selected countries and in particular in Switzerland, Austria and Slovenia the quality of the locations and the store size are interesting and aligned with OVS standards. At customer level the present positioning of Charles Vögele — a family brand — and OVS are similar. We believe that customers will be happy to see that the newly converted stores will include a great kids range and a generally broader assortment at a more compelling price positioning. With this transaction, OVS aims to accelerate its internationalization process in three relevant adjacent markets.”

OVS will be granted an option to purchase a further 44.5 percent stake in Sempione Retail from Retails Investment, one of the two financial co-investors, from the third year following the acquisition of the shares.

OVS, which is publicly listed on the Italian Stock Exchange, said the investment will have with no material impact on its financial leverage.

Sempione Retail is a company owned by a consortium consisting of OVS (35 percent); Aspen Trust Services Ltd. as trustee of the Elarof Trust (20.5 percent), already a 15.2 percent shareholder of Charles Vögele, and Retail Investment Srl (44.5 percent), a company with an expertise in the apparel sector. Upon completion of the offer, Sempione Retail intends to delist Charles Vögele from the SIX Swiss Exchange.

The main offer period is expected to commence on or about Oct. 26 and end Nov. 23.

Under the lead of Beraldo, in the fiscal year ended Jan. 31, OVS revenues rose 7.5 percent to 1.32 billion euros, or $1.49 billion, despite continued contraction in the sector as a whole in Italy. In 2015, OVS opened 189 stores between franchises and directly controlled units, but also improved sales in existing locations.

OVS SpA is 52 percent controlled by Gruppo Coin SpA, with the remaining shares publicly listed. Coin is owned by the private equity firm BC Partners.

In July, OVS said Jean Paul Gaultier was designing a capsule collection for the Italian retail chain that will bow in mid-November.

Over the past years, OVS has worked closely with influential figures from the fashion and art world, including Elio Fiorucci, Costume National and Matthew Williamson. Most recently, it launched a capsule collection dedicated to the cultural patrimony of Italy. These collaborations are part of efforts by OVS to bolster its image, also on an international and cultural scale.