MILAN — Italian clothing manufacturer and retailer Stefanel SpA has agreed to sell Munich-based women’s wear retailer Hallhuber GmbH to private equity firm Change Capital Partners LLP as it looks to reorganize its business.
The 25 million euro, or $35.4 million, sale to Blitz 09-450 GmbH, a German company controlled by Change Capital, is expected to be completed Sept. 10, subject to approval by German tax authorities, a spokesman for Stefanel confirmed Thursday. The figure could rise by another 4 million euros, or $5.7 million, following a conditional earn-out.
Dollar figures were converted at average exchange rates for the periods to which they refer.
Stefanel, which acquired the 30-year-old Hallhuber for around $17.5 million in March 2000, posted pretax losses of 17.3 million euros, or $22.6 million, in the first quarter, up from losses of 4.7 million euros, or $7 million, in the same period last year. The Italian firm has embarked on a three-year plan to refocus its business, including repositioning the Stefanel brand as an accessible designer label. The group also operates the High and I’M Isola Marras casualwear brands under its Interfashion business unit and holds a 50 percent stake in airport retailer The Nuance Group. Sales for the three months ending March 31 fell 25 percent to 66.8 million euros, or $87.4 million, after Stefanel stopped selling the Marithe & François Girbaud label.
Hallhuber, which has 93 points of sale across Germany, Austria and the Netherlands, performed well in the first half of this year, reporting a 13 percent rise in revenues to 29.6 million euros, or $39.5 million. For the full year 2008, the middle market retailer generated revenues of 58.1 million euros, or $85.5 million. Earnings before interest, taxes, depreciation and amortization reached 4.9 million euros, or $7.2 million, while net profits were 1.7 million euros, or $2.5 million.
The deal is Change Capital’s first in almost three years and follows its successful turnaround and sale of Jil Sander to Tokyo-listed apparel group Onward Holdings Co. Ltd. for $240 million in September 2008.