The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
ZURICH, Switzerland — CVC Capital Partners has agreed to buy Breitling, the Swiss watchmaker known for aviation-themed timepieces worn by actor John Travolta, in a deal said to be valued at more than €800 million ($870 million).
The transaction is expected to close in June, subject to approval by competition authorities, CVC said in a statement Friday. Theodore Schneider, Breitling’s current majority owner, will reinvest in exchange for a 20 percent stake.
Breitling is one of the larger Swiss watch brands that's still independent while most others have been acquired by competitors, such as Swatch Group AG, Richemont, LVMH and Kering SA. The watchmaker had hired advisers from GCA Altium Ltd. to find a buyer.
Swiss watch exports rose for the first time in 21 months in March, ending their longest slump on record as shipments to Hong Kong pulled out of a two-year decline, the Federation of the Swiss Watch Industry said Thursday. Withering demand had led brands such as Vacheron Constantin and Cartier to cut jobs.
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Chinese Demand
CVC will likely focus on stoking demand for Breitling’s watches in the Chinese market, one of the people said, asking not to be identified because the plans are private. The company reported 2016 sales of 420 million Swiss francs ($424 million), the person said.
Breitling's watches start at about 2,500 francs and celebrity endorsers have included Travolta, Russell Crowe and David Beckham. The brand probably sold about 5 percent of Switzerland's higher-end watches in 2015, according to analyst Rene Weber at Bank Vontobel in Zurich.
The Swiss watch industry has seen several brands up for sale in recent years as they struggled with slumping demand in Asia and the surge in the Swiss franc. Maurice Lacroix was put up for sale by owner DKSH Holding AG in 2016, but failed to find a buyer. Frederique Constant and Alpina were bought by Japan's Citizen Watch Co. last year. Corum and Eterna were also previously acquired by Hong Kong-based Citychamp Watch & Jewellery Group Ltd.
Leon Breitling opened his workshop in 1884 in the Jura mountains. The brand modernized chronograph watches by separating the stop-start functions from the reset button, creating a way to measure sports competitions and flights without returning the hands to zero. The brand is also known for its Emergency wristwatch, which has a personal locator beacon that the wearer can trigger to alert rescue authorities.
By Sarah Syed and Aaron Kirchfeld, with assistance from Corinne Gretler; editors responsible for this story: Aaron Kirchfeld, Amy Thomson and Paul Jarvis.
The group’s flagship Prada brand grew more slowly but remained resilient in the face of a sector-wide slowdown, with retail sales up 7 percent.
The guidance was issued as the French group released first-quarter sales that confirmed forecasts for a slowdown. Weak demand in China and poor performance at flagship Gucci are weighing on the group.
Consumers face less, not more, choice if handbag brands can't scale up to compete with LVMH, argues Andrea Felsted.
As the French luxury group attempts to get back on track, investors, former insiders and industry observers say the group needs a far more drastic overhaul than it has planned, reports Bloomberg.