TowerBrook ties up Jimmy Choo deal

TowerBrook Capital Partners has bought iconic UK shoemaker Jimmy Choo in a £185 million deal, generating a substantial return for previous owners Lion Capital in just over two years.

Jimmy Choo, the luxury goods company backed by UK buyout firm Lion Capital, has been sold to TowerBrook Capital Partners for £185 million (€280 million, $362 million).

Lion Capital, which only bought the company in November 2004 in a deal worth about £101 million, is set to make a return of about 2.25 times its initial investment.

Since taking control of the business, it has almost tripled the number of its outlet stores and increased sales to more than £65 million. The buyout firm appointed Rothschild towards the end of last year to sell the business.

TowerBrook, which is headquartered in London and New York, spun out of financier George Soros’s alternative asset management business in 2005. This is the eighth transaction from its $1.3 billion debut (€1.1 billion) fund, which closed in March 2006 and is already 50 percent invested.

Ramez Sousou, co-chief executive of TowerBrook, said Jimmy Choo was “one of the most innovative and successful brands in the luxury goods sector… [which] has achieved world-wide renown almost unparalleled for such a young brand.”

Jimmy Choo was founded in 1996 as a luxury shoemaker by the eponymous designer and former Vogue accessories editor Tamara Mellon. This will be its third period of private equity ownership. Phoenix Equity Partners and fashion executive Robert Bensoussan bought out Choo’s equity stake in 2001, and introduced other accessory lines alongside the shoe business before selling it to Lion in 2004.

Mellon, who is likely to make almost £25 million from the deal, is re-investing in the TowerBrook buyout, and will remain as company president. Bensoussan will also continue as chief executive, with a remit to look at further bolt-on acquisitions in the luxury goods sector. Its new owners are also likely to target further expansion in Asia.