March 1 (Bloomberg) -- Dressed in nothing but their lingerie and boxer shorts, more than 300 shoppers lined up outside the Desigual shop in the Soho neighborhood of New York City on Sept. 23, 2010, for a free outfit.
“I got out here at 1 a.m.,” said one customer in a video posted by the company on YouTube, her driver’s license stuffed into a pink bra as bypassers snapped pictures of the crowd, who were attending a marketing event Desigual called an Undie Party.
She emerged from the store hours later, posing in a black and green jacket. Other shoppers screamed with glee as they walked away in the color-splashed designs and prints the retailer is known for.
Such promotions -- and others, like kissing festivals in London, Paris and Berlin -- have helped make Thomas Meyer, the 50-year-old founder and owner of the Barcelona-based fashion chain, a billionaire.
Desigual, which is Spanish for “atypical,” has tripled its annual sales in the past five years to 700 million euros ($903 million), according to Orbis, a database of company information published by Bureau van Dijk. The company sold more than 22 million garments in 2012 through 330 of its own stores and 11,200 other points of sale in more than 100 countries.
Meyer has a net worth of at least $1.1 billion, according to the Bloomberg Billionaires Index. He has never appeared on an international wealth ranking.
“Desigual is a very unique, fast-growing brand that is doing well globally,” David Haigh, chief executive officer of Brand Finance Plc, a London-based consultancy, said by phone. Brand Finance releases an annual report on the most valuable publicly listed fashion companies in Spain. “They are very differentiated from other fashion brands. Their garments are edgy and complex.”
The company is valued at $1.6 billion, according to the Bloomberg ranking, based on the average enterprise value-to-earnings before interest and tax, and enterprise value-to-sales multiples of two publicly traded peers: Philadelphia-based Urban Outfitters Inc. and Cheltenham, England-based Supergroup Plc. Enterprise value is defined as market capitalization plus total debt minus cash.
Meyer owns all of Desigual, according to Orbis. He controls the company through Dutch holding company Lovelife BV, which he has renamed La Vida Es Chula, or Life is Cool, a Desigual slogan. In December, he bought back a 30 percent stake owned by departing chief executive officer Manel Adell, according to a local media report. The ranking subtracts $500 million from his net worth for the sale, based on the value of that stake in Desigual at the time of Adell’s departure.
The pair met while sailing the Atlantic Ocean in 1992. A decade later, Adell joined the company, first as a consultant and then as chief executive.
Desigual joins a select group of Spanish fashion companies that have flourished in a home market experiencing youth unemployment of more than 50 percent and declining GDP in all six quarters since July 2011, according to data compiled by Bloomberg.
Chief among them is Amancio Ortega’s Inditex SA, the world’s largest clothing retailer. Its shares rose 64 percent in 2012, helping the 76-year-old Spaniard to pass Warren Buffett as the world’s third richest man.
Meyer declined to comment on his net worth, according to Interprofit, a Barcelona-based public relations company that represents Desigual. Adell could not be reached for comment.
The Swiss-born Meyer founded the company in Ibiza, Spain, at age 21, having spent previous summers selling T-shirts on the Mediterranean island known for its nightlife. One of his first popular products was a denim jacket made from discarded jeans, which led him to open his first store in 1986.
Meyer was exporting clothing to France and Portugal within a decade. In 2002, he asked his friend Adell to manage the company’s expansion. The pair focused on bright prints and colors for the clothing and finding prime locations for the stores, such as its flagship London store on Regent Street.
“Desigual is characterized by its optimistic differential designs that are full of color,” Adell said in a 2011 interview with the Moodie Report, a travel retail newsletter.
In the interview, Adell said sales would exceed 1 billion euros in 2014. The company’s new CEO, Manel Jadraque, told business publication Textile Industry that he expected Desigual to have an earnings before interest and taxes margin of 18 percent in 2012, 28 percent more than the average margin of Urban Outfitters and Supergroup.
In January, Desigual took out its first loan, borrowing 200 million euros to fund expansion into Asia and Latin America, Textile Industry reported.
According to a 2008 account in the Spanish newspaper El Mundo, Meyer prefers to remain in the background, declining interviews and avoiding Desigual store openings. Those who know him say he is more open in private, the article said, citing people who asked not to be identified.
“In money matters he is Swiss,” the newspaper quoted an acquaintance as saying. “Otherwise he is very Spanish.”
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