- Simone Preuss |
Italian fashion brand Roberto Cavalli is in exclusive talks with Italian private equity firm Clessidra regarding selling a majority stake in Cavalli to the fund, Clessidra announced in a statement on Wednesday.
The aim of both companies is to reach an agreement by March 2015. Should the deal proceed as planned, Clessidra's executive vice chairman Francesco Trapani (former head of Bulgari) would become chairman of the Cavalli Group while designer and founder Roberto Cavalli would remain a shareholder. No further details were disclosed.
If the deal goes through, Cavalli's eight year search for an investor would come to an end. The company just ended unsuccessful talks with VTB Capital, the investment arm of Russian lender VTB Bank. Earlier this year, Cavalli had pulled out of a deal with London buyout firm Permira after not being able to agree on a price. Cavalli then approached Bahrain-based private equity firm Investcorp, which expressed no interest.
The Florence-based company has been trying to attract outside capital to further its growth. Like other small and medium-size companies, its size currently prevents Cavalli from expanding further, for example by investing in growth markets like the US and Asia. Prior talks with potential investors failed because Cavalli expected a much higher price than investors were prepared to pay.
According to Sanford C. Bernstein analyst Mario Ortelli, Cavalli could be worth half a billion euros (617 million US dollars). The brand, known for exotic prints and sandblasted jeans, recorded revenues of over 200 million euros in 2013, an increase of 9 percent compared to 2012. No figures have been released for 2014 so far.
Clessidra seems to be eyeing the fashion market as the fund had earlier this year bought a 35 percent stake in Harmont & Blaine, a Naples-based casual wear brand. Clessidra and Cavalli had already tried to come together in 2009 over the sale of a 30 percent stake in Cavalli but talks were broken off.