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Ferretti: That's Italian for Yacht

The group's luxury craft are being snapped up from Dubai to California, fueled by the growing ranks of the superwealthy

The Italian seafaring tradition, made famous by the likes of Christopher Columbus and Amerigo Vespucci, is alive and well. Though the Italian economy is growing by a mere 1.5% annually, Italian shipbuilding is expanding at a rate of 9%. The pace is even faster at luxury yacht maker Ferretti Group, which is growing at a clip averaging 20% per year. The company's performance is an example of what can happen when the Italian art for crafting luxury goods is combined with savvy investment capital.

The luxury yacht business is a fragmented one, made up mainly of small entrepreneurs who are passionate about the sea. Norberto Ferretti was one such entrepreneur, but after his brother, who handled the business side of Ferretti Group, died suddenly in 1995, Ferretti partnered with European private-equity fund Permira. Permira helped Ferretti reorganize, rack up 10 acquisitions, and cut costs. For its efforts, Permira earned a tidy return of 54 times its original investment in only two years, when it took Ferretti public in 2000.