Zegna announced that it would gain a listing on the New York Stock Exchange by merging with a publicly traded acquisition fund known as a SPAC. The deal is expected to value Zegna at about $3.2 billion, including debt, and may pave a path for other privately held luxury giants to follow.
The deal is also the latest sign that big luxury fashion companies are gearing up to get even bigger, seeing an opportunity in taking over rivals and becoming empires. It is a trend that has perhaps been exemplified by LVMH Moët Hennessy Louis Vuitton, the fashion empire that in recent years has struck deals to buy the likes of Tiffany & Company.
For much of its existence, Zegna has been known primarily as a top-tier maker of men’s wear fabrics and, later, suiting. But with its purchase in 2018 of a majority stake in the fashion label Thom Browne, Zegna began its own ambitious plan to become a stable of luxury brands. Zegna now runs nearly 300 stores in 80 countries. And in a sign of optimism about revived consumer spending on fashion, the company expects its sales this year to come close to prepandemic levels.
Merging with Zegna is a fund run by Investindustrial, a European investment firm. The deal will give Zegna about $880 million in fresh cash while allowing its founding family to retain a roughly 62% stake.
“Our goal now is to support Zegna in this important new chapter of its history while opening the opportunity to the public to invest in one of the last great iconic independent luxury brands,” Sergio Ermotti, the chairman of the Investindustrial SPAC, said in a statement.The deal is expected to close by the end of the year, pending approval by SPAC’s shareholders.