The Tod's Italian Experience Gets a LVMH-L Catterton French Financial Infusion
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Early Spring Fruit in the LVMH - Tod’s Orchard
On March 23, 2002 — over 20 years ago — LVMH, Moët Hennessy Louis Vuitton announced that Diego della Valle, Founder, Chairman and Managing Director of Tod’s, the Italian leather goods group, had joined its Board of Directors.
LVMH had acquired 3.2% of the share capital of Tod’s at the time of its flotation in November 2000.
On Sunday, February 11, 2024 — Super Bowl Sunday —the Tod’s-LVMH connection went into relay mode with news that Tod’s Diego Della Valle, his brother Andrea Della Valle and the LVMH-backed private equity firm L Catterton have entered an agreement involving the launch of a tender offer at €43 per Tod’s share, with the goal of delisting the company from the Italian stock exchange.
At First, a Tod’s Failure
Tod’s first announced a desire to delist its company from the Italian stock exchange in August 2022. That effort failed in October 2022, when a bid launched solely by the Della Valle family failed to reach the 90% threshold required to delist.
Today’s financial offer will leave the Della Valle Family with a 54 percent stake in Tod’s capital and assets; L Catterton will indirectly own 36 percent and Delphine SAS [a fully-owned subsidiary of LVMH] will retain a 10 percent stake. [In 2021 LVMH increased its stake in Tod’s from the aforementioned 3.2% to 10 percent.]
As Vogue Business noted,
”I am very pleased to announce this transaction, which will provide further benefits to the future development of Tod's Group, built through continuous investments and challenging goals,” Diego Della Valle said in a statement. “We determine that leaving the stock exchange now — with which we have always had an excellent relationship — is the most appropriate strategic choice. Sharing this path with L Catterton — the leading global consumer investment firm — which highly appreciates our brands and their desirability will give us the chance to further develop our group and to seize the opportunities that the market will offer.”
“Tod’s Group is synonymous with luxury, quality and craftsmanship, embodying the Italian ethos that the Della Valle family captured so perfectly over 100 years ago,” Michael Chu, global co-CEO and co-founder of L Catterton, said. “It is an honour to partner with the Della Valle family in this important next stage of the company’s remarkable journey.”
Deep-Roots, Dynamic Forests and Fruit Orchards
Anne of Carversville wrote days ago about about our growing understanding of the management style of LVMH/Bernard Arnault-trained executives.
LVMH plants deep-roots, dynamic forests in which their brands can flourish financially while lifting all boats. It’s an idealistic form of capitalism and money at work. AOC understands that many people believe that no one deserves to be as rich as the Arnault family.
Anne of Carversville is inclined to accept this reality as a fact of life on planet earth. Our focus is how does this family operate. What are their values and are they self-consumed in the style of Elon Musk or do they operate with a sense of moral and ethical obligations to their staffs, workers, artisans and communities?
Today, we add ‘business partners’ to the list of ‘how do they operate’ qualities. Indeed LVMH plants deep-roots, dynamic forests. In this case of Tod’s — which includes Tod’s Group brands Hogan, Roger Vivier and Fay — there is a close history between two men — Diego Della Valle and Bernard Arnault that has slowly and methodologically born fruit.
So we should add “dynamic forests and fruit orchards” to the AOC script. This style of business is very old-school and in all honesty, not very American in the 21st century. Della Valle said in 2021 that if and when he decides to sell, of course it will be to “Bernard”.
The Example of Acqua di Parma
Just one other example of the synergies between the Italians and LVMH at the time Diego Della Valle joined the LVMH BOD in 2002 concerns Acqua di Parma, which AOC coincidentally wrote about as well this week. [Yes, we are now giving priority to all matters LVMH].
LVMH also held 50% of Acqua di Parma alongside Italian investors, including Diego Della Valle; Luca Cordero di Montezemolo, chairman of Ferrari; and La Perla’s Paolo Borgomanero — who then held the remaining 50%, when Della Valle joined the LVMH board.
Over two stages culminating in 2003, the Italian triumvirate sold Acqua di Parma to LVMH, where it flourishing and opening a new cafe in Seoul.
