MILAN — It’s a deal.
After months of speculation among executives here, Versace has finally landed a suitor and sold its beauty arm, Giver Profumi, to Euroitalia.
The deal was inked after a late-night meeting on Wednesday between Versace and Euroitalia executives accompanied by their financial backers. Although the purchase price was not disclosed, Euroitalia’s big Christmas present came with a price tag estimated by market sources to be 48 million euros, or $63.8 million at current exchange rates. The acquisition included Versace’s broad range of fragrances, including the Versus brand scents, plus the skin care and makeup lines.
Versace issued a statement Wednesday evening in Milan saying that Euroitalia had purchased 75 percent of the licensing deal from Versace and the remaining 25 percent from ICR, which is held by Roberto Martone.
The sales reinforced the dominance of Euroitalia among the Italian-based beauty companies. According to industry estimates, Giver’s total revenues reached 67 million euros, or $90.4 million, in sales last year. That, combined with Euroitalia’s estimated volume, yields a total of $594 million.
Most of the Versace and Euroitalia executives were not available for comment at press time, having left for the Christmas weekend. However, Claudio Tenan, Euroitalia export manager, said, “We are extremely happy and look forward to the future.”
Industry sources speculate that Euroitalia obtained 8 million euros, or $10.6 million, of the purchase price from equity funds and 40 million euros, or $53 million, from the Italian bank Banca Intesa.
According to reports that had been swirling for months, one of the critical issues in previous talks centered on the fate of Giver Profumi’s workforce. Industry executives have indicated that the question was smoothed over, with Euroitalia taking on Giver’s employees, some of whom had been at Giver for 20 years.
Versace stated that the sale of its beauty arm was in line with a plan to focus on the label’s core business of clothing and accessories. The fashion house added that the money received from the Giver transaction will go toward paying off some of its outstanding debt.
The Versace beauty business joins a Euroitalia fragrance and cosmetics portfolio that already includes names such as Dolce & Gabbana, Moschino and Alessandro Dell’Acqua. The $504 million firm also controls the Naj-Oleari fragrance, color cosmetics and treatment business, as well as fragrances under the Reporter and El Charro monikers.
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Reached at his office on Sunday, Martone said that ICR will continue to manufacture Versace’s fragrances throughout 2005 and that he believes in the future of the brand.
“I am happy and content that the Versace license will stay in Italy,” Martone said. “Euroitalia has done fantastic work with Dolce & Gabbana and it will also do a great job with Versace.”
His comment appeared gracious considering that Martone previously had been mentioned by sources as one of the rival bidders in partnership with Selective Beauty. But Euroitalia won out.