Desigual worth 2.565 million euros, four times more than in 2012

ANALYSIS_ The entrance of French investment group Eurazeo has quadrupled Desigual's value in just two years, from 700 million euros in which it was valued in 2012, to the 2,565 million euros fetched after the injection of capital. In mid-March, French venture capital firm Eurazeo announced the acquisition

of a 10 percent stake in the Spanish fashion brand for 285 million euros, hence valuing the company in circa 2,850 million euros.

Barely

two years ago, the company was valued at about 700 million euros, as per the price of the 30 percent yielded by the then Director General Manuel Adell. Adell pocketed 200 million euros when he left the company and sold his 30 percent of to Desigual's president and founder, Thomas Meyer.

Eurazeo´s bet for Desigual breaks the mould for fashion investments

According to data handled by the market, Eurazeo would have paid 11.7 times EBITDA for Desigual, compared to the average 10 times EBITDA paid in this type of transactions within the apparel sector, highlighted sources consulted by 'Women 's Wear Daily '.

In an interview with financial journal 'Expansion' , Professor of Financial Management and Control at ESADE, Jaime Sabal, explains that "when the profit margins on sales are so different from one brand to another, you have to look more at the EBITDA at checkout when applying multiples to set the value. But it is not the only yardstick, borrowing has also analysed the capacity for growth."

Desigual has closed the year 2013 with a turnover of 828 million euros, or a 18 percent more than in the previous year. Profit after tax - which currently accounts for 16 percent of total revenue - recorded an increase of 76 percent since 2012.

Angela González Rodríguez