Permira grabs controlling stake in Valentino

Permira has bought a 29.6 percent stake in Valentino Fashion Group, stealing in ahead of Carlyle for a stake in the Italian fashion company, which also controls German-listed Hugo Boss.

UK buyout firm Permira has bought a controlling stake of 29.6 percent in Valentino Fashion Group at a price which values the company at €2.6 billion ($3.5 billion). Permira will pay €35 per share plus a €0.65 dividend per share.

Permira said in a statement it will pay €782.6 million to acquire the holding from the textile-making Marzotto family. The family will retain a 0.3 percent stake.

Permira said it was interested in increasing its stake. If its holding goes above 30 percent it will need to make a bid for the company according to Italian law. 

On the back of the speculation US newspaper The Wall Street Journal hinted that Valentino Garavani, the Italian designer who has been with his namesake label for 45 years, may not stay on if the company were sold.

Carlyle was rumoured to be the early favourite in the chase for the fashion group.

If Permira secures the whole company this would be the biggest private equity deal in the European luxury goods sector to date. It is believed other fashion brands will attempt to go private in order to compete against the fashion giant LVMH.

Fashion is very much à la mode for buyout houses. Earlier this year Towerbrook Capital bought luxury shoe firm Jimmy Choo for £185 million ($367 million, €270 million), while fashion group Prada sold Jil Sanders to Change Capital Partners last year and Apax Partners acquired Tommy Hilfiger for $1.6 billion (€1.2 billion).