By Elisa Anzolin and Mimosa Spencer MILAN/PARIS (Reuters) -Moncler’s Chairman and CEO Remo Ruffini is tightening his control of the outerwear specialist after striking a deal with LVMH, which will partner with Ruffini to fund an expanded investment in the Italian company. The deal also strengthens French group LVMH’s dominance of the global luxury […]
By Elisa Anzolin and Mimosa Spencer
MILAN/PARIS (Reuters) -Moncler’s Chairman and CEO Remo Ruffini is tightening his control of the outerwear specialist after striking a deal with LVMH, which will partner with Ruffini to fund an expanded investment in the Italian company.
The deal also strengthens French group LVMH’s dominance of the global luxury sector. Milan-based Moncler, one of the industry’s biggest success stories in recent years, had been seen as a potential acquisition target or merger candidate for rival luxury groups seeking to expand.
Under the deal announced late on Thursday, LVMH purchased a 10% stake in Double R, the investment vehicle controlled by the CEO’s Ruffini Partecipazioni Holding, which currently has a 15.8% stake in Moncler.
Double R will increase its stake in Moncler up to 18.5% over the next 18 months, thanks to the funding provided by LVMH that will increase its investment in Double R up to 22%, Ruffini Partecipazioni Holding and LVMH said in a statement.
Over the last nine months, two investors in Double R had exited the vehicle and were paid with Moncler shares, which had reduced Ruffini’s control of the company .
The partnership with LVMH will reinforce Ruffini’s position as the largest shareholder of Moncler, the companies said.
LVMH will gain the right to appoint two board members to Double R, solely controlled by Ruffini, as well as a director on Moncler’s board.
Investors have grown jittery about a slowdown in the luxury sector, particularly weakness in the key Chinese market, hit by slowing economic growth and a property crisis .
But Moncler has proven resilient, with 11% revenue growth in the first half of the year , thanks to double-digit growth in Asia.
(Reporting by Elisa Anzolin and Mimosa Spencer; Editing by Jamie Freed )
