3i has joined existing shareholder L Capital as a major investor in Gant Company, owner of the US fashion and lifestyle brand. 3i has paid around $20m for its 20 per cent stake in the business, which has an enterprise value of $125m.
In 1999, Sweden-based Gant AB (at the time named Pyramid Sportswear) acquired a majority in the Gant brand from Phillips Van Heusen alongside L Capital. Prior to the acquisition, Pyramid Sportswear, led by Lennart Bjork, Klas Kall and Staffan Wittmark had been granted the rights to design and market GANT products worldwide, excluding the US market.
The deal came about after Philips Van-Heusen announced that it was planning to sell its interest in the company. The other shareholders decided to bring in a new investor to acquire van Heusen’s stake in the business.
“We were informed that Phillips Van-Heusen was planning to sell its stake in the business and we decided to get involved,” said 3i’s Bard. “Gant is a high quality company with a leading international brand and first-class management team.” 3i and LV Capital have already teamed up on a previous acquisition in the European retail sector, investing in Spanish educational games manufacturer Imaginarium. Last year, 3i sold part of its stake in Imaginarium to LV Capital and management.
Gant products are sold in 54 countries through 164 branded stores and independent retailers. In 2002, the company reported sales of SKr3.6bn (E390m), with revenues in 2003 forecast at E87m.
The company is planning an IPO within the next few years, if market conditions are favourable. “This transaction brings renewed stability to the business,” adds Bard. “We are in a position where we can think about an IPO, but we are in no hurry.”
L Capital makes investments in consumer brands and entrepreneurial companies from its offices in Paris and Milan. Its latest fund was raised in 2001 with E264m from its sponsor, LVMH.
News of the deal comes a day after 3i announced it had sold Balfour, a chain of 76 corner shops and 35 newsagents, to the Co-operative Group in a deal worth £30m.