The Latest Investments: Neiman Marcus, Kering & Hermès


Sophie Doran | September 12, 2013

Kering snaps up a minority stake in Joseph Altuzarra, as department stores Printemps, Saks Fifth Avenue and Neiman Marcus are all sold to new owners

The big investment news this month is all focused on department stores. Namely, the billion dollar acquisitions of leading luxury retailers in France and North America.

Neiman Marcus has been acquired in a deal worth $6 billion. Printemps has finally been sold to Qatari-backed investment fund Divine Investments for €1.6 billion, ending months of speculation and regulatory approval. Saks Fifth Avenue has followed suit, with Saks Inc. signing a deal with Hudson’s Bay Company to acquire the department store for $2.9 billion.

As the luxury industry further consolidates on a global scale, we bring you all the latest m&a; movements by brands, conglomerates and private equity funds.

Stake: Caruso, Fosun

China’s largest privately owned conglomerate Fosun has added to its portfolio of luxury goods by buying a 35 per cent stake in Italian luxury menswear manufacturer and retailer Caruso, for an undisclosed sum understood to be in the low millions of euros. The deal came after Mr Zhong, Fosun’s head of global investment, ordered – and liked – a suit from the northern Italian menswear maker.

Source: Financial Times

Investment: Joseph Altuzarra, Kering

Kering has taken a minority stake in Altuzarra, the label founded in 2008 by French-American designer Joseph Altuzarra. The exact size of the stake was not disclosed, though “the company will remain independent and controlled by Joseph Altuzarra and his family,” Alexis Babeau, managing director, Kering Luxury division, told WWD.

Source: Business of Fashion

Bought: Neiman Marcus, Ares

The owners of Neiman Marcus Inc agreed to sell the U.S. luxury department store chain to two private investors for $6 billion, almost $1 billion more than they paid for the company in 2005. The buyers, Ares Management LLC and the Canada Pension Plan Investment Board (CPPIB) will split ownership equally, with an undisclosed minority stake going to current management.

Source: Reuters

Increase: LVMH, Hermès

LVMH Moet Hennessy Louis Vuitton once again increased its stake in Hermes International to 23.1% from 22.6% in the first six months of 2013, according to LVMH’s half-year consolidated financial statement. “It doesn’t say anything about our attitude in the future so you cannot extrapolate that for the rest of the year,” Chief Financial Officer Jean-Jacques Guiony said on a conference call.

Source: Bloomberg

Bought: Saks Fifth Avenue, HBC

The Hudson’s Bay Company recently signed an agreement with Saks Incorporated to buy the Saks Fifth Avenue chain for $16 per share in a deal worth $2.9 billion. The deal is still pending regulatory approval as well as the termination of a 40-day “go shop” period in which Saks can entertain alternative proposals.

Source: JustLuxe

Sold: Reed Krakoff, Coach

Reed Krakoff has resigned as president and executive creative director of Coach to focus on his own eponymous line, which it turns out he’s buying from Coach for $10 cash.

Krakoff will also assume debts tied to the business and issue Coach 15% of the business’ “common membership interests.” Coach will also receive “convertible preferred membership interests” representing another 20% of the membership interest.

Source: The Gloss

Stake: Aston Martin, Daimler

Luxury sports car maker Aston Martin is to team up with Daimler’s Mercedes-AMG division to develop a new generation of bespoke V8 engines for the British firm. Under the deal, which is due to be finalized before the end of the year, Daimler will take a non-voting stake of up to 5% in the 100-year-old British firm and supply engines to Aston Martin, which will also receive electronic components from Daimler’s Mercedes-Benz unit.

Source: Reuters

Bought: Hotel Saint-Barth Isle de France, LVMH

Moet Hennessy Louis Vuitton has purchased Hotel Saint-Barth Isle de France in the Caribbean, from majority owner Adventurous Journeys Capital Partners and others for an undisclosed sum. The company described the move as “a natural extension of LVMH’s activities across the luxury spectrum,” in a statement.

Source: Market Watch

Sold: Flexjet, Directional Aviation Capital

Bombardier Inc. has agreed to sell its Flexjet aircraft flight-share unit to a U.S. buyer for $185 million, who will in turn order business jets valued at a minimum of $1.8 billion from the plane manufacturer. Bombardier will sell the Dallas-based unit for to Flexjet LLC to a new company funded by a group led by Directional Aviation Capital, according to a statement.

Source: Bloomberg

Speculation: Versace

Gianni Versace SpA has said it plans to sell a minority stake privately before selling shares to the public in three to five years. “We decided to open a minority stake sale” before an initial public offering, Chief Executive Officer Gian Giacomo Ferraris has revealed. Versace hired Goldman Sachs Group Inc. and Banca IMI SpA last year to explore growth options.

Source: Bloomberg

Sold: Printemps, Divine Investments

French department store chain Printemps has been sold by the Deutsche Bank and Italian businessman Maurizio Borletti to Qatari-backed investment fund Divine Investments SA, or Disa, in a deal said to be valued at 1.6 billion euros. Disa acquired a 70% stake from Deutsche Bank’s Asset & Wealth Management’s real estate business and the remaining 30% from Luxembourg-based Borletti Group.

Source: FashionUnited

Bought Out: Technomarine

TechnoMarine SA has announced a change of shareholders, with Jacques-Philippe Auriol and the management taking over all shares in the company. This buyout is part of a revitalisation plan by Auriol to reposition the brand and product range, improve quality, launch a new communication strategy and expand distribution.

Source: Market Wired

Insolvent: Wiesmann

Wiesmann GmbH, a German maker of retro-style luxury sports cars, has filed for insolvency at a local court and is seeking strategic partners and investors. Rolf Haferkamp remains chief executive officer and plans to restructure the company.

The automaker markets cars combining “timeless design and modern technology", employing just 110 people, and has sold more than 1,600 of its handmade vehicles with maximum annual sales of about 200 in Europe, the Middle East and Asia.

Source: Bloomberg

Speculation: Kering, Sergio Rossi

According to Italian daily newspaper “Il Sole 24 Ore”, luxury brand Sergio Rossi is reportedly up for sale. A source close to the matter has confirmed that Milan-based investment bank Mediobanca has been trusted with the mandate. The Qatari royal family and Diesel founder Renzo Rossi are rumoured to be amongst potential buyers.

Source: FashionMag

To List: Moncler

Moncler plans to list around 25% of its shares, said Claudio Costamagna, advisor for the company’s long-awaited initial public offering. The IPO is expected to take place between the end of the year and early next 2014, depending on the market.

Besides chairman and creative director Remo Ruffini, who has a 32% stake, the Paris-based Eurazeo has a 45% stake, The Carlyle Group owns 17.8% and Brand Partners the remaining shares.

Source: WWD

Memorandum of Understanding: Sartoria d’Avenza, Brunello Cucinelli

Brunello Cucinelli S.p.A. has signed a memorandum of understanding for the purchase of Sartoria d’Avenza, a business unit of d’Avenza Fashion S.p.A., specializing in tailoring men’s suits and made-to measure suits, that today employs 56 staff.

The parties intend to finalize the purchase of the business and the property at the beginning of 2014 with the signing the final agreements and the payment of the consideration, which in total will not exceed € 3.5 million.

Source: Brunello Cucinelli Group

Stake: Vestiare, Condé Nast

Condé Nast International announced it has led a $20 million investment in Paris-based luxury e-commerce Web site Vestiaire Collective, alongside private equity firm Idinvest Partners and existing investors: venture capital firms Balderton and Ventech.

This new investment — a first of its kind by Condé Nast International in France — comes after the investment in March in London-based, an online marketplace for high-end, independent fashion boutiques worldwide.

Source: WWD

Bought: Time Inc., American Express Publishing

Time Inc. has agreed to buy American Express’ luxury publishing division, which includes Food & Wine, Travel + Leisure and Departures. The price of the sale, expected to close in Q4, has not been disclosed. The sales talks were prompted by rules that required AmEx, as a bank holding company, to exit noncore businesses. Banking regulations limit AmEx’s ability to work in non-banking activities.

Source: Adweek

Investment: The Fancy, Richard C Perry

Social commerce start-up The Fancy has raised another $7 million in funding from investors, including hedge-fund manager Richard C Perry, who owns a controlling stake in Barneys New York. The most recent injection of capital was disclosed in a regulatory filing last week that did not name the investors.

This brings the total amount of capital raised in the company’s latest round of funding to $60 million, from investors including American Express, billionaire Len Blavatnik, actor Will Smith and Kering chairman and chief executive François-Henri Pinault.

Source: Business of Fashion

Acquired: Hotel Concorde, Blackstone

After having sold most of its properties to Qatar, Concorde Hotels has reportedly agreed to sell Concorde Opéra Hotel in Paris to Blackstone, the investment fund which controls Hilton Worldwide, for €250 million. The Concorde Opera has 266 rooms, including 40 suites, as well as extensive conference space and two restaurants.

Source: CPP Luxury

For more in the series of The Latest Investments, please see our most recent editions as follows:

- The Latest Investments: Richard Mille, Loro Piana & Porsche
- The Latest Investments: Coty, Versace & Pomellato
- The Latest Investments: Gucci, Printemps & Buccellati

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