Image source here.
After a shockwave of “fashion in the wake of Brexit” articles were posted by practically all fashion news sites, I am happy to pick up on some good news, on the European mainland mind you.
Balmain oh so French, is now Balmain-bin-Nasser. On 22nd of June, my favourite Arab business woman and former queen, or as her full title goes Her Highness Sheikha Mozah bint Nasser Al Missned, has purchased 100% of Balmain.
This comes after a very successful takeover of Valentino a few years ago, through her investment firm Mayhoola.
Mr Valentino Garavani – image source here.
Now for the case of Valentino, Sheikha Mozah saved the company from huge losses, because private equity firm Permira didn’t seem to know the difference between some chiffon and a chignon.
Permira was – just as any private equity money shark – in it for a quick fix, a profit after taking a company over for a few years and then selling it on. Although highly successful with other business endeavours, they became the laughing stock of the fashion industry.
The royal Quatari however, brought Valentino back to life, because she understood the importance of the creative vision and the intricacies of a luxury fashion house. It was under her supervision that superstar designer duo Maria Grazia Chiuri and Pier Paolo Piccioli.
Damon Buffini, founder of Permira private equity firm, taking a guess. Image source here.
Take a guess: Which one is the chiffon and which one the chignon?
In this context I am really excited to see what the royal style queen will do with Balmain and how the company might grow and thrive under her supervision. I am also curious to see if she will wear Balmain as much as she wears Valentino!
The stunning Sheikha bint Nasser in a Velentino dress. Image source and more images of her amazing style here.
If you are keen to read some more about this, please sse below an article which appeared on Fashion United:
- Angela Gonzalez-Rodriguez
- Wednesday, June 22 2016
Mayhoola, the Qatar’s sovereign fun has just acquired the French fashion house Balmain, The group already own Italian luxury powerhouse Valentino.
“After completing this transaction Mayhoola for Investments will hold 100 percent of Balmain’s capital,” said the merger and acquisitions company Bucephale Finance, reported Reuters.
As published by ‘Les Echos’, the Qatari fund would have reportedly offered 485 million euros for Balmain, which to date was mostly (70 percent) in the hands of the heirs of the former CEO, Alain Hivelin, who died in December 2014. The remaining 30 percent of the company’s capital is held by management.
Market sources have explained that the reported Qatari offer was higher than sale estimates of 300 to 400 million euros. Under the terms of the agreement, Mayhoola agreed to finance Balmain’s international expansion as well as the development of an accessories line, add sources close to the matter.
Qatari fund Mayhoola buys Balmain from former CEO’s heirs
The transactions puts an end to months of negotiation between the Qatari sovereign fund –supported by the emir of Qatar – and the fashion label current investors, who include Sanofi co-founder Jean-Francois Dehecq and the family of former chief executive and controlling shareholder Alain Hivelin, who passed away in 2014.
Founded in 1945 by designer Pierre Balmain, his namesake brand has gone through various creative and financial crisis, lately enjoying added momentum following the leadership of Pierre Decarnin, a former stylist at Paco Rabanne, came on board in 2006 and relaunched the brand, catching the attention of several Hollywood stars.
Hivelin revived Balmain, which was near bankruptcy in 2004. It’s noteworthy that Balmain remains one of the very few remaining major independent fashion labels In France, along with Lanvin and Hermès.
Sources quoted by Reuters estimate that Balmain generated around 130 million euros in sales in 2015, with sales growing by 25 percent.
The final price, which is unlikely to be disclosed, will depend on how much cash the existing shareholders will take out of the company, highlights ‘The Guardian’.
Market sources have pointed out that, being the final price tag 460 million euros, the Qataris would be valuing Balmain at around 14 times earnings before interest, tax, depreciation and amortization (Ebitda)
Mayhoola is an investment vehicle supported by Sheikha Mozah, the second wife of the former emir, which already owns Valentino and holds controlling stakes in Italian tailor Pal Zileri and British fashion brand Anya Hindmarch.
Original source: https://fashionunited.com/executive/management/valentino-s-owner-buys-balmain-for-485-million-euros/2016062211774