LVHM´s Private Equity Subsidiary reveals plans to purchase Etro

L Catterton, a private equity firm backed by French luxury giant LVMH, has agreed to buy a 60 percent stake in Italian fashion company Etro, two sources familiar with the matter said on Sunday. Etro valued the deal at around 500 million euros ($ 590 million), the sources said, confirming reports in Italian newspapers La Repubblica and Il Sole 24 Ore. Etro said in a statement that L Catterton will acquire a majority stake in the company while the Etro family will retain "a significant minority stake". She did not go into details or give any financial details. Gerolamo Etro, who founded the company in 1968, will be the chairman and the deal is expected to be finalized by the end of the year, the statement said. "We are excited to partner with the L Catterton team who will bring their in-depth knowledge of the fashion industry and experience developing major brands internationally, which will enable our company to reach new heights," said the company. LVMH and L Catterton were not immediately available for comment. In April, a source close to the matter had told Reuters that the Milan-based luxury brand was considering an expression of interest from L Catterton, an investment firm that emerged from a partnership between Catterton, LVMH and billionaire Bernard Arnault. One of the sources said that Etro's four children would remain as shareholders with a 40 percent stake and would continue to own Etro's real estate and directly operated businesses.