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Top luxury brands for M&A targets

By Kristopher Fraser

29 Jul 2022

Business

Image: Burberry

Mergers and acquisitions can be some of the most dramatic and costly transactions in the entire fashion industry. They also get the public talking, so while they aren’t moves meant for publicity, they keep PR departments busy. In 2018, when Michael Kors acquired Versace for 2.12 billion dollars, forming Capri Holdings, it was one of the biggest trending fashion news stories of the year.

Authentic Brands Group has also been on an acquisition spree for the past several years. The company has added Brooks Brothers and Reebok to its portfolio and is now considered one of the biggest power players in retail acquisitions.

In January 2016, consumer-focused private equity firm Catterton, along with luxury conglomerate LVMH, formed L Catterton, a company for providing equity to emerging brands. These could also be future brands that LVMH could scoop up for their portfolio.

There are more than several independent labels that large companies have their eyes on for a potential M&A opportunity. Many mergers and acquisitions could happen within this decade. The Wertheimer family will likely never relinquish their control of Chanel, so don’t get too happy.

1.Salvatore Ferragamo

Ferragamo is one of the most recognized names in luxury fashion in the entire world, and the company has been family owned and independent for the entirety of its history. Some recent actions by Ferragamo indicate the company could be likely looking for a buyer. Former Burberry CEO Marco Gobbetti left Burberry for Ferragamo. Goldman Sachs banker Claudio Costamanga also joined the Ferragamo Finanziaria board. Ferragamo has status as a luxury brand, and its shoes alone would be a crown jewel in any company’s portfolio. It’s a ripe target for a big-name company to swoop in if the brand was up for sale.

2.Jacquemus

Jacquemus’ rise to fame as one of the most coveted luxury brands in the world was a fast and furious one. Designer Simon Porte Jacquemus wowed the world with his tiny Chiquito handbags, making him one of the most talked about names in fashion. While the brand is poised to continue growing and has the revenue to do so, the backing of a large conglomerate, like LVMH or Kering, could make a world of difference to the brand scaling up.

3.Burberry

Burberry would be one of the biggest titans for a company to acquire, and is one of the most powerful and profitable independent luxury brands in the world. There is no denying that acquiring Burberry would be a lucrative investment, from the scarves to the trench coats, their pieces never go out of style. The difficulty with acquiring Burberry would be that 100 percent of its shares are publicly traded, so a buyer would need to convince a majority with their offer.

4.Moncler

Moncler’s ski jackets are a status symbol that people would kill to get their hands on. The average four-figure price tag the jackets come with makes them a symbol of luxury, particularly for those who live in places with serious winters. Moncler is also a billion-dollar-plus asset, and post-lockdown their sales are showing signs of growth. Their 2021 sales topped 2 billion euros, just a year after most brands struggled with the lockdown. The caveat with Moncler is that they also own Stone Island, and it’s possible they could be looking to continue their own acquisitions. If someone wants to merge or acquire Moncler, they’ll do their best to prepare a plan for building a fully stocked brand portfolio.

5.Mulberry

U.K.-based luxury brand Mulberry has long been of interest ever since the company took to hit after the collapse of House of Fraser in 2018. The brand is still considered to have strong sales potential outside the U.K., and their handbags are seen as a great entry-level luxury piece for those just starting their luxury handbag collections. Groups looking to add brands with strong accessories potential to their portfolios would jump at the chance to acquire Mulberry in a heartbeat.

BURBERRY
Mergers and Acquisitions
MONCLER