L Catterton Sells Dondup to Made in Italy Fund
As reported, sources told WWD that the Made in Italy Fund, managed by Quadrivio and Pambianco, was eyeing an acquisition of Dondup, and that the transaction was expected to be finalized by the end of this week.
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Stakes in Dondup were acquired by the European arm of L Capital in 2009 and then by L Capital Asia in 2015. L Capital is now part of L Catterton. Financial details of the sale were not revealed.
The Made in Italy Fund private equity group has upped its fundraising target to 300 million euros from 200 million euros, and more than 70 percent of that has already been invested.
Dondup is the seventh investment of the Made in Italy Fund, and the fourth in the fashion segment, in line with the private equity group’s goal to create a fashion pole. In November, the fund acquired a majority stake in GCDS, the Italian streetwear label founded in 2015 by brothers Giuliano and Giordano Calza, creative director and chief executive officer, respectively. It has also invested in the 120 Percent Lino brand, acquiring a 70 percent stake of its parent company Palladium Moda in the fall of 2018 and last year it acquired a 60 percent stake in Rosantica, the custom jewelry and accessories brand founded in 2010 by Michela Panero.
Alessio Candi, Made in Italy Fund partner, said the acquisition of Dondup reinforces the strategy of “investing in Italian firms with pronounced know-how so that we may be an instrument for international growth and consolidation for them.”
Matteo Marzotto, president and a shareholder of Dondup, is leaving the company.
“This was a very positive experience of more than four years and it was a gentle turnaround because Dondup was already an excellent company and it is now stronger and better organized than in 2016,” Marzotto said in an interview.
Marzotto became president of Dondup in September 2016 and also credited former CEO Marco Casoni for the restructuring and boosting the company’s earnings before interest, taxes, depreciation and amortization.
“Back then, EBITDA totaled 9 million euros, today it stands at 14.2 million euros,” said Marzotto. “We went through two very delicate steps, overcoming the family-owned dimension and changing skin in terms of design.”
Marzotto tapped current CEO Matteo Anchisi, who will continue in this role under the new owner and become a shareholder.
“I am happy he will stay on, he is an excellent manager. I believe this is a great deal for the Made in Italy Fund,” Marzotto concluded.
As reported, Marzotto has embarked on another fashion project, buying two companies in Italy’s luxury goods supply chain, forming Ambria Holding with two partners, including Casoni, and taking majority stakes in Italian companies Zeta Catene and Galvanica Formelli, which respectively produce chains and metal details, components and galvanic treatments for fashion accessories.
Dondup was founded in 1999 in Fossombrone, in Italy’s central Marche region by Massimo Berloni and Manuela Mariotti, produces men’s and women’s ready-to-wear collections and is entirely made in Italy. Both exited the company shortly after the arrival of L Catterton.
The Made in Italy Fund plans to create an industrial group that will promote and enhance the synergies between Dondup and 120 Percent Lino and Rosantica.
Dondup closed 2020 with sales of more than 52.6 million euros, and Italy represents 65 percent of its revenues.
Mauro Grange, CEO of the fund, said the goal is “a far-reaching expansion and internationalization plan for Dondup. We intend to strengthen the brand, particularly in the USA, where 120 Percent Lino and Rosantica are already present, by acting with an industrial slant, by drawing on the interaction mechanisms already existing between the various companies and by settling careful attention on sustainability aspects. This new operation stands as yet another building block in the group’s strategy, shaped to create a fashion hub.”
The fund also plans to promote and strengthen the positioning of the brand with a communication strategy that will consolidate its awareness and identity, turning it into an aspirational label.
The goal is also to develop Dondup’s retail channel through flagships in main capitals as there is currently only one existing store in Milan in Via della Spiga. The fund also plans to strengthen the brand’s online channel and increase its attention to sustainability.
Anchisi said that a “shared vision” with the Made in Italy Fund “has made the path a smooth one right from the outset. Its respect for the direction Dondup has taken ‒ from its transition to 100 percent Made in Italy products to its vigilant attention for sustainability aspects, through to its desire to guide the brand to grow gradually and constructively ‒ has convinced me to invest alongside the fund, and I’m sure we’ll accomplish great things together.”
Francesca Roni, operating partner for Made in Italy Fund, said the new owner plans “to create a center for the reuse, recycling and reselling of jeans products, as action to convey the brand’s values of sustainability and honesty, and to prompt customer loyalty among the younger generations.” Denim is a core product for the brand.
In 2018, Dondup partnered with the well-respected and innovative Italian Candiani mill to create the D/Zero denim fabric, which employs 50 percent less water and 70 percent less chemicals compared with Candiani’s denim, which is already considered innovative in terms of sustainability.