LVMH buys Loro Piana

Italy's luxury cashmere house Loro Piana have been bought by LVMH. The french luxury conglomerate purchased an 80 percent stake in the ready-to-wear fashion group for 2 billion euro. LVMH shares rose 2.5 percent on the news.

LVMH said that the sixth-generation Loro Piana family will retain the remaining 20 percent share, and its current directors, Sergio and Pier Luigi Loro Piana, will maintain their posts.

The Italian fashion house is famed for its high quality clothing by using precious materials such as cashmere.

Loro Piana cashmere sweaters typically retail from 750 to 2000 euros. LVMH said the change in ownership will have a positive earnings effect as of the first year.

LVMH purchased an 80 percent stake in Loro Piana

"Loro Piana is an exceptionally rare Maison, rare in the unique quality and craftsmanship in its products, not least in cashmere and fine textiles but also in the unbroken heritage and careful family husbandry over six generations," said LVMH CEO Bernard Arnault.

Loro Piana's turnover for 2013 is expected to reach around 700 million euros while its pre-tax profit is forecast to come in at around 150 million euros.

Loro Piana was established in 1924 by Pietro Loro Piana. In the post-war period his nephew Franco took over the company and moved it into the international high fashion markets.

Originally from Trivero, the Loro Piana family started as merchants of wool fabrics at the beginning of the nineteenth century. In the second half of the century the family moved its activity to Valsesia and founded the Lanificio Fratelli Lora e Compagnia, followed by Lanificio di Quarona di Zignone & C. at the beginning of the 20th century.

Image: Loro Piana