Under the deal signed by Blackstone with
The family-controlled brand, which has struggled for years following the murder of founder Gianni Versace in 1997, has been reluctant so far about going public or getting in outside investors. But in April last year it gave indications that it is looking at options to fund the expansion of the sales network.
On completion of the transaction, Blackstone will own 20 per cent of the company and will have one seat on the company's Board. The Versace family -
Gianni's sister Donatella is the creative director and older brother Santo is company president, while Donatella's daughter Allegra owns 50 percent of the company and sits on the board.
Versace's enhanced capital position will allow the company to invest in the expansion of its retail store network in existing and emerging markets. It will also enable Versace to bring forward plans to develop the company's portfolio of brands, in particular Versus Versace, and widen its product range with a specific focus on accessories. The company is also looking at the possibility of enhancing its e-commerce business.
"We are all incredibly excited by this development, which recognizes the work done over the past years to put the company on solid ground by nearly doubling its size," said
"Versace has great brand recognition globally, unique creativity and a formidable organization which, with Blackstone's investment, we can leverage to take the Company to the next level," Ferraris added.
Versace, which is planning to release its 2013 results at the end of March, expects to announce an 18 percent rise in revenues up approximately
While the fashion house returned to profit in 2011, it has lacked the cash to expand rapidly in fast-growing markets abroad.
"It is a great pleasure to be working with a true icon in
We are delighted to be involved with this exceptional business, and are committed to helping Versace realize its strong growth potential around the world. We look forward to helping Donatella and the management achieve their goals."
Like many of the Italian fashion brands including
"This is a very large and very well-known brand so it could be revived ... but a lot of work has to be done on the creative side," Exane BNP Paribas analyst Luca Solca said in the wake of the deal on Thursday.
"The brand has to be updated and they need new ideas. With a minority stake it might not be possible to make these changes," he added, referring to the potential influence of Blackstone.
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