Italian Fashion House Prada, Up For Sale
August 4th, 2007 Posted by: Dr. Cox
PRADA has put a €3-3.5 billion ($A4.8-5.6 billion) price tag on the business amid speculation that rag-trade billionaire Richard Caring may make a bid for the Italian luxury fashion chain. Rag-trade billionaire Richard Caring, who owns a number of London restaurants including the Ivy, has been named as one of the interested parties.
UK newspapers The Sunday Times and The Daily Telegraph of London said that Caring, who owns London’s swanky Ivy and Le Caprice eateries, faces competition from at least two private equity groups for the Milan-based chain, citing city sources. Meanwhile the UK’s Financial Times said the fashion house is preparing for an initial public offering (IPO) instead of a private sale.
“The information in the piece is completely incorrect,” said Prada spokesman Tomaso Galli in a telephone interview. “The company is not for sale and there have been no meetings with anyone regarding a sale.”
Prada denied on Monday a report in Britain’s the Sunday Times newspaper that it was in talks to sell the Italian fashion house to billionaire entrepreneur Richard Caring. Galli said the Milan-based firm was still evaluating selling shares on the stock market starting from next year. He said its value is higher than the 2 billion euros (US$2.73 billion) cited by the Times.
“The company is worth between 3 [billion] and 3.5 billion euros,” Galli said.
Prada, known for its sleek, modernist tailoring, enjoyed a 63 percent increase in profits last year, taking them to 76 million euros. Prada, which also owns English shoemaker Church & Co., cut costs and sold unprofitable Jil Sander and Helmut Lang fashion houses to concentrate on developing its brands, including Miu Miu.
Net income climbed to 76 million euros in the 2006 fiscal year through January from 47 million euros in the prior period, the company said in April. Sales rose 7.5 percent to 1.43 billion euros.
The fashion industry is attracting private equity firms because of high margins and resilient demand for its products, with growth particularly strong in Asia and Russia.
