The real spend on luxury shopping has been going up in the last one year and it is helping the luxury brands to bounce back from the lean phase of recession. The companies are busy leveraging the improved scenario to consolidate their position and implementing plans for expansion to recover whatever they had lost during the dull phase. The Italian fashion brands like Prada and Moncler have already accessed the equity market to fund their expansion plans and the Florence leather goods company Ferragamo has firmed up its plan for an initial public offering sometime this year.
Ferragamo had a shareholder meet on March 30 and it approved the board’s plans of the listing project. The capital markets would be accessed to fund the future growth strategies. The other details about the proposed IPO were not forthcoming as the company declined to comment. However, sources in the know confirmed that the documents for the IPO would be submitted to market regulator Consob soon for the listing to take place by July or by the end of 2011 at the latest. Reliable sources confirmed that 30% of the share offering would be floated in the US and Japan markets.
There are a group of banks and financial consultants like JPMorgan Chase & Co and Mediobanca who are the lead managers for the IPO. The consultants are coordinating the issue globally. Chief Executive Michele Norsa had been non committal about the IPO in February but had ruled out a possible listing outside Italy. The Italian fashion house registered a 26% growth in sales last year and bounced back to profit. With total revenue of $1.4 billion last year the enterprise value of the group is estimated to be between 1 and 1.7 billion euros.