Alto sells Italian fashion company

Italian private equity house Alto has sold its stake in underwear maker Arcte to Mariella Burani Group, in a cash and stock deal.

Italian mid-market private equity firm Alto has sold its 90 percent stake in underwear manufacturer Arcte Group to Italian luxury goods group Mariella Burani. Financial terms have not been disclosed.

Bologna-based Arcte makes mass market underwear and beachwear. Its brands include Argentovivo, Baci Rubati, Julipet and Allen Cox.

It is the first exit from Alto’s second fund, the €165 million Alto Capital II, which closed in Febuary this year. The firm invested in Arcte in November 2005.

Mario Visioni, a partner at Alto, said the timing of the deal provided a good rate of return for his firm. There will be no changes to the management, he added.

Alto decided against running an auction process, instead using its long-standing relationship with Burani to arrange the deal. The deal will consist of cash and a 3 percent stake in Burani Designer Holding, the company that owns the majority of Mariella Burani. This holding company plans to list on London’s AIM market in order to fund further expansion.

Burani said that it envisaged synergies between the Arcte brands and its own retail network.

Burani is listed on the Milan stock exchange and has a market capitalisation of €800 million ($1.1 billion).