Versace-Blackstone deal: hinting an IPO?

Wednesday, 16 April 2014
The by-laws the Italian fashion house has adopted after investment fund Blackstone bought a 20 percent stake, might hint a potential stock market listing in the next there to five years. The holding company that controls Versace SpA, GiVi, retains the remaining stake, with a strengthened alliance between Donatella and her daughter Allegra now also penned by law.

The brand controlled by the family of late founder Gianni Versace sold a fifth of its company´s equity to Blackstone in a deal sealed earlier in April whereby the Versace family got the funds they needed to open new shops abroad, where it sees strong demand for its clothing and accessories.

The 210 million euro deal values Versace at more than 14 times its core earnings for last year, above the luxury sector average of around 11, as stressed by analysts closely following the luxury market.

New details revealed on the deal and the by-laws that the controlling family has set might envisage a bourse listing within three to five years, ‘CorrierEconomia’ said on Monday.

According to sources quoted by Reuters, the board of Versace chose the US-based group as a financial, not strategic, investor because it wants to remain independent.

Blackstone's deal opens up internal restructuring at Versace

Additionally, the entrance of Blackstone has provided the perfect opportunity for the Versace clan to redefine their namesake company´s structure. Through a complexly ruled agreement, Donatella Versace and her daughter Allegra – owners of 20 and 50 percent each of the Company – have sealed their alliance.

From now on, their combined 70 percent will move together, also by statute. At the same time, Donatella´s brother Santo Versace´s position is progressively diluted. Owner of the remaining 30 percent, the co-founder of the Italian fashion power house will remain president.

If the forecast listing materialised, Santo´s heirs will be able to liquidate their shares by selling them to Donatella and Allegra, advanced ‘Il Corriere della Sera’.

According to ‘WWD’, Donatella and Allegra will have the option to buy Santo Versace's 30 percent stake from his heirs, if he doesn't sell them himself upon the initial public offering.

Angela González Rodríguez

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