Hugo Boss AG dropped the most in eight months in Frankfurt trading after majority owner Permira Advisers LLP sold a stake in the German luxury-clothing maker.
Hugo Boss fell as much as 6.5 percent to 86.73 euros, the steepest intraday decline since Sept. 11, and was trading down 5.9 percent at 12:04 p.m. That pared the stock’s gain this year to 9.4 percent, valuing the Metzingen-based fashion producer at 6.14 billion euros ($8.06 billion).
Permira disposed of 7 million Hugo Boss shares, or about 10 percent of the total, in an accelerated bookbuilding, the London-based private-equity firm said in a statement today. The sale was priced at 87.50 euros a share, the lower end of a revised price range of 87.50 euros to 88.50 euros, two people familiar with the matter said today.
The investor inherited the stake when it bought a majority holding in 2007 in Milan-based Valentino Fashion Group SpA, Hugo Boss’s parent company at the time. Permira sold its Valentino assets to a group led by Qatari investors in July 2012. Permira, which owns the Hugo Boss stock through the Red & Black Holding GmbH investment unit, reduced the stake to 56 percent stake from 65.56 percent with the disposal. Morgan Stanley managed the transaction, and UniCredit SpA was co-bookrunner.
Permira prolonged the term that it will keep its remaining Hugo Boss stock to at least nine months from six months, the fashion company said in a statement. The private-equity firm doesn’t plan to sell more shares in Hugo Boss, according to a person familiar with the matter.
Freely traded stock will represent about 42 percent of the total after the disposal, Hugo Boss said earlier today.
The clothing maker reiterated its earnings forecast for the year yesterday. Its retail business increased sales by 14 percent in the first quarter as the unit opened more outlets.