Luxury fashion house Etro has entered a binding agreement to sell a majority of its stake to L Catterton, eyeing Asia expansion.
Under the agreement, Etro family will retain a significant minority stake while Etro’s founder, Gerolamo Etro, will be appointed as chairman of the company. The acquisition is expected to close by the end of the year.
Under the deal, the LVMH-backed private equity firm will support Etro to enhance its digital presence and drive global expansion, with a focus on the significant opportunity in Asia.
“L Catterton has a shared vision and a unique appreciation for our business, and the firm takes the same approach to partnership our family does,” said Gerolamo Etro. “After nearly 55 years under our stewardship, we believe that together with L Catterton, Etro can enter its next chapter of growth and solidify its place as one of the great, lasting luxury houses.”
Although the value of the acquisition deal has not yet been disclosed, according to Reuter, sources familiar with the acquisition said the deal values Etro at about US$590 million, equivalent to 60 per cent of the company.
“We are confident that with our broad global network and experience building fashion brands, Etro will be well positioned to become an international powerhouse and a leader in its category,” said Luigi Feola, managing partner, head of Europe at L Catterton.
Founded in 1968, Etro is known for its signature paisley motif and bold patterns inspired by travel. The Italian brand operates 140 retail stores across the globe.