Kering has purchased a 30% stake in the Italian fashion label Valentino for a whopping 1.7 billion euros.
👉 Background: Kering is behind some of the biggest luxury brands we know: Gucci, Saint Laurent, and Bottega Veneta.
👉 What happened: Recently, Kering has struggled with its star brand Gucci growing at just 3%. So now, it has purchased a 30% stake in the Italian fashion label Valentino for a whopping 1.7 billion euros.
👉 What else: Interestingly, this purchase also includes an option for Kering to buy the entire Valentino business by 2028.
💡An "option" is the right, but not the obligation, to buy something in the future. And generally, this option is at a specified price and before an expiration date.
💡Kering has paid a to reserve the right to buy the rest of Valentino at a later date, but before 2028. If they decide not to pursue it, the current owner, Mayhoola, will keep their initial payment and can sell to someone else.
💡This agreement gives Kering time to see how Valentino's business develops without having to commit to buying it outright from the start. In other words, it's the old "try before you buy".
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