Jan 15, 2009
Designer Roberto Cavalli says to sell stake
Jan 15, 2009
MILAN, Jan 15 (Reuters) - Italian designer Roberto Cavalli said he had agreed to sell a minority stake in his fashion house to private equity company Clessidra, a local business daily reported on Thursday.
"I am close to signing a preliminary (agreement) for the sale of a minority stake to the Clessidra fund," Cavalli was quoted as saying by Il Sole 24 Ore.
Cavalli, known for his bold prints and long flowing dresses, said he planned to sell a stake of 15 percent to 20 percent.
"Nothing more," he said.
"(The idea is to) list ourselves on the market between three and four years," he said.
"I had to think a lot in these last few weeks and I believe that it is the best way to ride the recovery after this moment of economic crisis."
He did not say how much the stake was worth.
Cavalli previously had decided against doing a deal with private equity companies because of a disagreement over valuation, Il Sole 24 Ore said.
The companies had offered a price equivalent to between 10 and 11 times the house's earnings before interest, tax, depreciation and amortisation (EBITDA), while Cavalli wanted 16 times, it said.
Il Sole 24 Ore said Cavalli had estimated his fashion house was worth 1.4 billion euros, 16 times its 2007 EBITDA.
"For 800-900 million euros, who will make me sell? The company is healthy," he was quoted saying.
A Cavalli spokeswoman was not immediately available for comment to Reuters.
In September, the designer, who counts the Spice Girls among his fans, told Reuters he did not have the financial needs to do a sale and would wait.
Initially an array of bidders were drawn to the auction, attracted by the company's potential in emerging markets.
Italian fashion companies, often still run by the founding families, are under pressure to bring in outside capital or management as competition mounts from major luxury conglomerates such as France's LVMH (LVMH.PA).
IT Holding (ITH.MI), owner of Gianfranco Ferre, has said it intends to finalise a deal with China's Mensun, with whom it was locked in exclusive discussions until Dec. 31.
Its chief executive has been given the go-ahead to continue talks and explore other deals.
Salvatore Ferragamo in November reiterated markets needed to stabilise for the luxury goods brand to work on a bourse listing.
Prada has also had it sights on a public offering but said last year it was waiting for market turmoil to subside. (Reporting by Gilles Castonguay and Marie-Louise Gumuchian; Editing by Karen Foster and Andrew Macdonald)
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