Is Moncler taking over Burberry?

Burberry’s struggles in recent years have been no secret. Despite the appointment of a new creative director and chief executive officer, its financials have remained somewhat lacklustre, leaving it in a vulnerable position for a potential takeover. And rumours have begun to swirl that down jacket specialist Moncler could be none other than its saving grace.

According to industry blog Miss Tweed, “growing industry chatter” suggests the Italian luxury brand may be on the verge of making a bid for the iconic British label, a move that Bernard Arnault, CEO of Moncler-backer LVMH, is believed to be “keen” on. Such a takeover is suggested to be part of plans to establish an “outdoor specialist giant”, the report stated.

In light of the report, Burberry shares rose up to 8 percent on Monday, a much needed uptick after the brand fell off the FTSE 100 index in September due to its low valuation. Moncler, however, has told various media that it would not comment on “unsubstantiated rumours” in regards to the alleged deal.

Burberry remains ‘a potential takeover target’

Over the past year, analysts have deemed Burberry to be at risk of a potential takeover after it posted a series of disappointing financials, leaving shareholders concerned about its performance. A continued weakened demand for luxury alongside the surprise ousting of its former CEO, Jonathan Akeroyd, who was replaced by Joshua Schulamn in July 2024, has also had an impact on shareholder sentiment, bringing into question the strategy it has in place through which it hopes to encourage a turnaround.

Earlier this year, Abrdn investment manager, Sasha Kachanova, told The Telegraph: “Burberry remains a potential takeover target, particularly at its current valuation. As the sole British brand of scale operating independently – a rarity in the luxury industry – it boasts a rich heritage and the opportunity to enhance its iconic product lines and accessories.”

Moncler, meanwhile, could be a strong suitor for a Burberry bid. The company has garnered backing from French luxury giant LVMH, which had snapped up a 10 percent stake in Double R, an investment vehicle controlled by Ruffini Partecipazioni Holding, the firm of Moncler’s CEO Remo Ruffini that holds a 15.8 percent stake in the brand. In turn, LVMH secured a 1.6 percent stake in Moncler with the potential to grow it to 4 percent over the next 18 months.