Financial sources close to the operation confirmed the sale to WWD on Sunday morning.
Etro’s real estate properties and web of directly owned stores were not part of the sale. Overall, there are about 200 Etro stores around the world.
Etro was advised by Rothschild and the Pedersoli legal studio, and L Catterton by PriceWaterhouseCooper and the Lmcr studio.
While the Etro family had long denied any intention of selling the company, in April asked to comment on the speculation, the response was that “the group is focused on creating the conditions for the future growth of the business. In this context, the group is also evaluating possible partnerships aimed at facilitating said process.”
Gerolamo Etro, known as Gimmo, founded the company in 1968 as a textile firm and, with a forward-thinking initiative, decided to invest in ready-to-wear and lifestyle in the ’80s, expanding into collections that ranged from perfumes to suitcases. The family includes siblings Veronica, creative director for the women’s collections; Kean, men’s creative director; Ippolito, who oversees strategic management, and Jacopo, who is in charge of the home line. Francesco Freschi holds the role of general manager.
Two years ago, sources said Qatar-based Mayhoola, which also counts Valentino, Balmain and the Italian men’s label Pal Zileri among its investments, had been eyeing Etro with particular interest. However, a deal never materialized, and sources told WWD that the family members had different views on the sale.
Valentino’s former chief executive officer Stefano Sassi has been quietly consulting for Etro for several months now, but, according to sources, there had not been further taking place between Mayhoola and Etro. Sassi was seen as an added asset in the negotiations with L Catterton. The executive joined Valentino in 2006 and was instrumental in leading and growing the company through the acquisition in 2012 by Mayhoola.
As per the most recent figures available, Etro sales totaled 285 million euros in 2018. The company’s debt is said to amount to around 50 million euros, according to a source.
L Catterton, backed by LVMH Moët Hennessy Louis Vuitton, has been busy since the beginning of the year, taking a controlling stake in French outerwear maker JOTT, known for its light, affordable down jackets in January. In March it took a majority stake in Birkenstock with family holding Financière Agache, an investment vehicle controlled by luxury titan Bernard Arnault and his family. That month, L Catterton also sold Dondup to the Made in Italy Fund.