3A Antonini, the Italian company that owns the Lumberjack brand of casual footwear, has acquired Alexander & Nicolette, a high-end shoe manufacturer of men’s and women’s footwear based in Parma, in a transaction that values the company at €3.6-4 million, including assumption of debt. It has set up a new company, called 1910 after the date of foundation of the Alexander brand, in which it holds a 90 percent stake. The balance of 10 percent is held by Alexander & Nicolette’s former owner, Valerio Cavalca, with a call option for 3A Antonini.
Alexander & Nicolette, which suffered a loss last year, is expected to reach a turnover of €7 million in 2004, mostly on a wholesale basis, but this also includes the revenues of a directly operated store in Parma and a factory outlet in Serravalle. Out of the total sales, 85 percent come from the Italian market, but 3A Antonini hopes to expand the foreign distribution. The older men’s footwear brand, Alexander, represents most of the turnover. Only 15 percent is accounted for by Nicolette, the women’s shoe brand introduced in the ‘sixties.
The company prides itself on preserving ancient techniques of craftsmanship in the manufacture of its shoes, which are made by hand, using high-quality materials. Besides its own Alexander, Nicolette and Alexander Trend lines – the latter is a secondary line of men’s shoes with rubber soles - the company manufactures top-quality shoes for Berluti, the famous brand of semi-custom men’s shoes of LVMH. The collaboration with LVMH, which currently contributes to 5 percent of Alexander & Nicolette’s turnover, will continue also in the future.
All its current operations in Parma will be maintained, with Cavalca remaining in charge of the production. The new company, 1910, will act as a separate entity, independent from Lumberjack, but Andrea Martini Antonini, vice president of 3A Antonini, will act as chairman.
For 3A Antonini, which is based in Verona, the acquisition of Alexander & Nicolette is a way to enter the high-luxury segment, diversifying its brand portfolio without any cannibalization. Martini Antonini is targeting breakeven results for 1910 in 2005 and a turnover of approximately €15 million in the medium term, of which 50 percent would be derived from foreign markets and 30 percent from women’s shoes.
The strategy is to emphasize marketing and distribution to increase the visibility of the product and the brands, possibly involving the recruitment of a well-known testimonial. While the present customer target of Alexander and Nicolette is aged between 40 and 60, Martini Antonini wants the focus to be widened to include the 35-year-old customer. The Alexander Trend line will be repositioned to compete directly with the likes of Church’s or Santoni. A new flagship store will be opened either in Milan or in Rome.
3A Antonini, which has been involved in shoe manufacturing since the ‘50s, reached a certain success in the ‘80s with the Lumberjack brand, which is highly recognized in Italy as a synonymous for quality and comfort. Its production is mostly carried out abroad, with a second Romanian plant scheduled to start up in Brasov next April. Excluding Alexander & Nicolette, but including its own retail stores, 3A Antonini should reach a turnover of €45 million this year. The company plans to invest 6 percent of its revenues on marketing and communication in 2005, partly in view of its 60th anniversary celebration.