Ermenegildo Zegna Will Go Public Through a SPAC Deal

Such takeovers have soared in recent years, with rivals across the ocean taking on similar empire-building ambitions. Capri Holdings, formerly known as Michael Kors Holdings, acquired the Italian fashion house Versace for $2.1 billion in 2018, while Tapestry, once known as Coach, has bought companies including Kate Spade and Stuart Weitzman.

The luxury industry has been resilient, as consumers have kept up spending on jewelry, apparel and other indulgences — including as the global economy slowly emerges from a pandemic. Shares of LVMH, whose brands include Dior, Stella McCartney and Fenty, are up by more than 60 percent this year; those in Kering, the parent of labels like Gucci and Saint Laurent, are up by 45 percent.

For much of its existence, Zegna was known primarily as a top-tier maker of men’s wear fabrics and, later, suiting. (It still makes suits for other high-end labels, notably Tom Ford.) 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.

While Zegna’s pursuit of more resources to expand is not novel, how it is doing so is.

It is merging with a SPAC — formally known as a special purpose acquisition company — a fund that is raised in the stock markets solely for the purpose of merging with a privately held company and giving it a stock listing.

Article source: https://www.nytimes.com/2021/07/19/business/dealbook/zegna-spac-deal.html