Cavalli Calls Off Private Equity Deal
Italian designer Roberto Cavalli has put off talks over selling a stake in his fashion business to a private equity firm. The Telegraph reports that bankers at Merrill Lynch in London and Italy were working on deals with buyout groups including Carlyle, Lion Capital and TPG in recent months. The deals halted on a pretty major sticking point, the value of the business. Cavalli figures his business is worth about $2 billion while some buyers thought that figure was close to $1 billion.
It’s unknown whether Cavalli has called off talks permanently or is on the hunt for someone who will agree with his valuation. In our currently gloomy economy some luxury companies are finding it increasingly difficult to attract investors willing to write the big checks. The luxury brands are doing well but right now the climate of economic fear has some firms fearing the long haul. For the moment Cavalli seems to have aimed too high but the Italian designer, famed for his sexy styles, will likely get his deal eventually, he might just have to scale back his expectations.