Ferragamo and Tod’s Seen As Luxury Targets

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July 12 (Bloomberg) -- Bloomberg’s Andrew Roberts reports on M&A within the luxury market and analyst thoughts on likely targets. He speaks on Bloomberg Television’s “The Pulse.” (Source: Bloomberg)

If you believe the flutter of reports that followed the announcement of the lvmh acquisition, there are plenty of analysts who think the next target may be in italy.

That happens to be where most of these luxury good companies are.

There is also another play going on.

It is partly to do with the economy in italy.

Analysts feel that financing conditions are tough for some of these companies when they are looking to expand.

You have to remember that a lot of these companies, even if some of them are listed, they are still family-run companies.

There is a degree of speculation given that the brothers said in a french interview that they felt they were not equipped to take the company to the next level, from a financial perspective what also from a management perspective and that they needed to be part of a big group to do that.

We will see potentially of the -- other companies, particularly a little bit bigger in the case of tods and ferragamo.

We will see them look to join some of the big players.

If you look at lvmh, they have been the most likely buyer of some of these assets.

If you look at the interplay with tods, lvmh already has a 3.5% share.

The founder of tods is on lvmh is -- lvmh's board.

When he seeks to retire, he is 59 now, perhaps down the line, lvmh may -- but it could be sooner than that.

That is pushing the stock at the moment.

When it comes to valuations, because the race is on to grab these brand, does this remind you of the mining industry over the past 10 years, premiums getting pumped up because of the scarcity of assets?

It is interesting.

There has been a recalibration of expectations.

A lot of the valuations were sort of thrown out the window.

It was looking to explore a sale five years ago.

It is now being valued around 400 million euros.

White a cut there.

Those valuations are increasing.

That is partly to do with the scarcity of assets and the increasing number of potential buyers, be they large conglomerates or private equity.

Thank you so much for all of that.

Andrew roberts in paris.

That's move on to other things we are watching.

This text has been automatically generated. It may not be 100% accurate.


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