The London-based private equity firm is buying a majority stake in the Italian footwear company Golden Goose from another investment group, the Carlyle Group. The size of Permira’s investment was not released but financial sources indicated that the price tag was €1.28 billion – a price more or less equivalent to 14 times last year’s expected Ebitda, no doubt because of bright future prospects for this brand.
The investment fund was probably encouraged by the progress made so far by Dr. Martens, a much older brand that it bought six years ago. The company’s Ebitda is estimated to have grown from €32 million in 2018 to €80 million last year.
The deal is expected to close in the coming months. Carlyle bought the Italian brand of high-end distressed sneakers in 2017 for €400 million from Ergon Capital Partners, which in turn had purchased it in 2015 from a group of investors including managers and the designers Alessandro Gallo and Francesca Rinaldo, who founded the brand near Venice in 2000.
During Carlyle’s ownership, Golden Goose increased its annual sales from €100 million to more than €260 million in 2019, with a growing presence in the U.S. and other countries, and expanded the network of directly-operated stores from seven to 58, including flagship stores in New York, Tokyo and Beijing. About 80 percent of the turnover comes now from outside Italy. Wholesale revenues from about 900 accounts represent around 60 percent of the turnover. The brand said that it is also enjoying “a fast growing online presence.” E-commerce should generate between 10 and 15 percent of revenues three years from now.
The brand’s sneakers, many of which are priced at about €400 a pair, have become a cult object after being worn by celebrities such as Taylor Swift, Gwyneth Paltrow and Selena Gomez. The shoes represent about 80 percent of its revenues, but the brand has started a diversification into other accessories and apparel to help keep up its strong momentum and fill its mono-brand stores with new products. The project is led by Frida Giannini, the former creative director of Gucci.
Golden Goose was managed between March 2017 and September 2018 by Giorgio Presca, the former chief executive of Geox who has been running Clarks since last March. The new CEO of Golden Goose, Silvio Campera, noted that Permira’s “experience and excellent record in the consumer sector will be invaluable to us as we continue to grow.” Permira, a former investor in Valentino and Hugo Boss, owns the iconic Dr. Martens brand and is evaluating the possibly of selling or listing it this year.
The British label, which Permira had bought in 2014 for £300 million (€360.8m-$391.5m), could be valued up to £1.2 billion (€1.4bn-$1.6bn). By the time it sold its last shares in Hugo Boss in 2015, Permira had made a $2.7 billion return on its investment in the German company, where it developed its retail sales especially and its business in China.
There have been media reports that Carlyle could be interested in Dr. Martens. Carlyle, which has also made a lot of money from its investment in Moncler, put up Golden Goose for sale at the end of last year. Reportedly, two other private equity firms, Advant and SPAC Acamar, made offers for the company.