Christian Louboutin valued at $3.8 billion as Italian dynasty takes stake in luxury shoe maker

Italy’s billionaire Agnelli family has snapped up a stake in Christian Louboutin, valuing the French luxury shoe maker, which is known for its signature red soled women’s shoes, at €2.3 billion ($3.8 billion).

Exor, the Agnelli’s European holding company, will invest €514 million to buy a 24{85e7f5b37d2b3b32ff943ebdbb52de90edc4132ca8c2134f6732351e5442126f} stake in the Paris-based brand to become its largest shareholder, the two companies said in a joint statement.

Shares in Exor, which have risen almost 6{85e7f5b37d2b3b32ff943ebdbb52de90edc4132ca8c2134f6732351e5442126f} so far this year, were up 4.05{85e7f5b37d2b3b32ff943ebdbb52de90edc4132ca8c2134f6732351e5442126f} in early afternoon trading in Milan on Monday.

The deal comes at a moment when Christian Louboutin, which is regularly worn by Hollywood film stars, musicians and royalty, is “poised to capture significant new opportunities,” including expanding geographically, with a particular focus on China, said Exor and Louboutin.

In recent weeks, several international luxury-goods groups have highlighted the growing importance of sales in China to offset dependence on tourism, amid an unprecedented collapse in global travel during the COVID-19 pandemic, which slowed spending on high-end goods.

Read: China’s ‘unstoppable’ global luxury-market share nearly doubles amid pandemic

Gucci, the fashion label owned by French group Kering
said in December 2020 that it was opening two flagship stores on Alibaba’s online luxury-shopping platform, which has more than 750 million Chinese consumers. The first store, selling fashion goods, opened on Dec. 21, while a second store focused on beauty products launched in February, and will be operated by Gucci’s license partner Coty

Designer Christian Louboutin founded his eponymous label in Paris in 1991 with co-founder Bruno Chambelland. Today the company has around 150 directly operated stores in 30 countries and a worldwide network of premium wholesale relationships.

Exor will also help the luxury shoe maker develop its multichannel distribution strategy, in part by extending its existing digital and e-commerce platforms.

Read: Nearly half of MyTheresa customers in the U.S. and Germany spend tens of thousands on luxury goods annually: Cowen

Alongside its investment, Exor will also nominate two of the seven members of Louboutin’s board of directors.

The deal, which is expected to close in the second quarter of the year, marks Exor’s second investment in the luxury sector in the space of three months. In December, it became the largest shareholder in Shang Xia, which was co-founded by France’s Hermès International
after making a $97 million investment in the Chinese luxury group.

Exor is also the largest single largest shareholder in luxury sports car maker Ferrari and Stellantis
the world’s sixth biggest automobile manufacturer that was created in January from the merger of Fiat Chrysler and rival PSA.