According to the Business Times, Kering SA, a French multinational company had a talk with Moncler SPA, an Italian luxury clothes manufacturing company, about a potential deal.
As Times reported, a senior executive at Kering revealed some information about the deal but for now, there is no official report from the companies regarding the amount of transaction likely to be involved and the nature of the deal.
Remo Ruffini’s Roles over Moncler’s Significant Growth
Moncler is currently worth $ 15.1 billion. Remo Ruffini, the CEO of Moncler has been able to transform the company into one of the major luxury brands in the world. According to Bloomberg, he holds a major stake of 22.5% in the company.
Presently, Moncler, which is known for its stylish jackets and sportswear, has gained 33% share in 2019, which makes the company’s capital soar. Presently, the company has many offices globally and has 49 stores in China alone.
According to Moncler official, “The company sales for the first nine months of the year rose 12 percent at constant exchange rates, reassuring investors that Chinese consumers are still spending on fancy ski jackets despite the effects of anti-Beijing protests in Hong Kong that have hit sales in the key luxury hub.”
Kering to Fight against the Rival, LVMH
Kering’s expansion needs Moncler to stay competitive against key rivals such as, LVMH which recently acquired the jewelry manufacturer, Tiffany & Co., for $ 16.2 billion. LVMH’s recent expansion deal poses a threat to Kering.
Among other subsidiaries of Kering, Gucci has been a major revenue provider. Gucci earned more than three-quarters of Kering’s revenues in the first half of 2019.
According to Bloomberg, the competition between LVMH chairman Bernard Arnault and Kering’s CEO Francois-Henri Pinaulthas brought a tremendous change in the luxurious items manufacturing industry for over the past few decades.
On December 5, 2019, Moncler’s shares were up by nearly 12% in Milan, while Kering’s and its subsidiaries’ shares increased by about 1% in Paris. Pinault needs to win over Moncler’s Ruffini in order to make the deal.
According to Bloomberg, “Ruffini has shown in the past that he’s willing to let go (the deal) when the price is right.” Pinault is now constantly taking efforts to make the deal work, as Arnault is pushing a tough battle with the Gucci’s parent company, Kering.
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