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Tod’s owners to take company private in €1.3B buyout

Aug 3, 2022
2021 photo of Diego Della Valle, Tod’s chair

Franco Origlia/Getty Images

The owners of luxury shoemaker Tod’s — the Italian billionaire Della Valle family — plan to take the company private in a deal valuing it at roughly €1.3 billion, according to the Financial Times.

Why it matters: Luxury retail dealmaking is having its day in the sun, with Tom Ford, Gieves & Hawkes and Armani all in play. One more valuation comp certainly couldn't hurt.

Driving the news: The Della Valle family said taking Tod's private will enhance the company's value and augment its visibility — away from the prying eyes of the public market, which imposes listing requirements, such as earnings updates.

  • The family is offering shareholders €40 for their shares, the same price it listed at in 2000, the FT notes.
  • Tod’s will delist from the Borsa Italiana following 22 years on the Milan-based stock exchange.

State of play: Hit by the COVID pandemic, which derailed the company’s plan to modernize the brand, Tod's sold a 6.8% stake to LVMH for €75 million last year. LVMH already owned 3.2%.

  • The company had been struggling pre-pandemic— its share price reached a height in September 2013 (€138.60) but has fallen about 70% to €40.32 today.
  • In 2017, CEO Diego Della Valle announced a turnaround plan for the company.

The intrigue: Despite luxury retail increasingly trending toward streetwear, CEO Della Valle insisted back in 2019 that the brand would not turn into a millennial streetwear label, FT reports.

💭 Our thought bubble: Analysts speculate this could be the first step in an eventual sale of the company to LVMH. We're not so sure — LVMH isn't shy about executing on M&A and if it wanted to own Tod's outright, it would.

  • Regardless, taking the company out from under the public eye as it executes its turnaround seems to be the soundest strategy.
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