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LVMH-backed L Catterton makes bid on Italian luxury group Tod’s

LVMH-backed private equity firm L Catterton has offered to buy a majority stake in luxury shoemaker and take it private, in agreement with the firm’s Della Valle founding family.

SEE ALSO: Tod’s annual sales lift 12 percent on Greater China surge, strong Japan

In the agreement, L Catterton is offering to buy 36 percent of Tod’s at EUR 43  (USD 46) a share, which values Tod’s at just over EUR 1.4 billion.

In a statement, Catterton said it owned 3.8 percent of Tod’s capital after buying shares in the group during the session.

Under the deal, CEO and founder Diego Della Valle will tender his 10.45 percent stake in the company to L Catterton, while retaining 54 percent of the company together with his brother Andrea.

LVMH is also a minority shareholder in Tod’s, raising its stake to 10 percent from 3.2 percent three years ago. The group owned by Bernard Arnault will retain 10 percent after the deal, according to reports.

“Leaving the stock exchange now… is the most appropriate strategic choice,” Tod’s Chief executive Diego Della Valle said in a statement.

In 2022, the Della Valles, who own 64.5 percent of Tod’s, tried to take the company private but failed to do so.

In addition to Tod’s, the Milan-based group owns the Roger Vivier shoe brand, as well as the Fay and Hogan labels.

Luxury stocks have been battered by the normalisation of industry demand, currently suffering from a slower-than-expected recovery in China and U.S. aspirational consumers remaining sluggish.

But recent earnings updates from some luxury firms show an improvement, especially at Tod’s.

In its most recent trading update in January, Tod’s said revenues grew 11.9 percent to EUR 1.12 billion for the full-year ending December 31, coinciding with a double-digit uptick in Greater China sales, and a strong Japan market.