MILAN — L Capital, the private equity arm of LVMH Moët Hennessy Louis Vuitton, said Wednesday it has taken a 40 percent stake in Italian apparel and denim brand Dondup for 30 million euros, or $43.3 million at current exchange.
This story first appeared in the January 14, 2010 issue of WWD. Subscribe Today.
This confirms a WWD report in September. The brand’s founders, husband-and-wife team Massimo Berloni and designer Manuela Mariotti, hold the remaining shares, with four minor partners.
Through the agreement with L Capital, Dondup chief executive officer Berloni said he planned to expand the brand’s business internationally. Dondup reported sales of about 60 million euros, or $83.4 million at average exchange, last year and Italy accounted for 80 percent of the business.
Berloni said he was “less attracted by emerging markets that show a more immediate boost and more by those that may be tougher, but will allow a more solid growth and a serious presence in Europe,” citing Germany, France and the U.K. as examples.
Daniel Piette, president of L Capital, said Dondup has “an extraordinary base, incredible performance and top creativity with an Italian twist.” Piette said Dondup has significant potential, and that L Capital will be able to contribute to the brand’s growing men’s and children’s wear and accessories divisions.
Berloni said he is wary of investing in directly operated units. A signature store may be possible, but a chain of Dondup boutiques is not, he said.
“Numerous stores may boost sales initially, but I’m not sure this would work for us in the long run,” Berloni said.
The brand is available at 1,240 points of sale.
Andrea Ottaviano, ceo of L Capital Italia, said the fund is interested in an investment stretching between four and five years, during which time it expects Dondup to achieve double-digit growth.
“We don’t plan to achieve this through the opening of Dondup stores,” said Ottaviano, adding that L Capital zeroed in on Dondup “because of its excellent product.”
Dondup, founded in 1999 and based in Fossombrone in central Italy, is known for its fitted denim pants. For spring, the brand introduced silk pants with a 3-D print reproducing blue denim jeans, seams, rips, belt loops and pockets. Denim accounts for 40 percent of sales. Production is entirely in Italy.