PPR Buys Stake in Christopher Kane, Seeks More Luxury Brands
PPR SA (PP), owner of the Gucci brand, bought a 51 percent stake in British fashion designer Christopher Kane, building on a collection of luxury labels that it is seeking to expand further.
PPR will help Christopher Kane, which is only distributed by third-party retailers, accelerate its expansion, the Paris- based company said today in a statement. PPR, which bought a majority stake in Chinese jeweler Qeelin last month, didn’t disclose any financial terms for today’s transaction.
Christopher Kane is worth about 20 million euros ($27 million), CA Cheuvreux analyst Thomas Mesmin estimated. The purchase fits the company’s strategy of making small to mid- sized luxury acquisitions, Mesmin said. The deal is reminiscent of PPR’s acquisition of British labels Alexander McQueen and Stella McCartney which it has since developed into global brands, he said.
PPR is looking at other targets, Alexis Babeau, managing director of the company’s luxury division said today on a call with reporters. The maker of Bottega Veneta bags and Puma sneakers is reorganizing to focus on luxury and sports-lifestyle brands as it aims for sales of 24 billion euros by 2020.
“We cannot rule out further acquisitions” in luxury, he said. “We are looking for brands which are not going to overlap with our existing portfolio.”
Scottish-born Kane, who founded his brand in 2006, said on the call he held talks with other investors and settled on PPR because the company’s model “fitted us perfectly.” Kane, 30, worked for Gianni Versace SpA’s Versus line until last year.
PPR will add distribution in Asia and open Christopher Kane stores probably from 2014 in London, Babeau said. The French company will also expand the brand’s product range, including accessories, which currently account for about 4 percent of sales, he said.
“Thanks to all those growth engines, we can really take the Christopher Kane brand to the next level in the coming years,” Babeau said.
The shares rose 1.6 percent to 151.85 euros at 1:50 p.m. in Paris as luxury stocks advanced across Europe.
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