Dries Van Noten Sells Majority Stake to Puig

Dries Van Noten, one of the last of the independent names at the top of Europe’s fashion sector, has sold a majority stake in his business to the Spanish luxury group Puig. The move reflects the difficulty that a stand-alone brand faces today in a global marketplace, with its continual pressure for technological innovation and growth.

In an announcement Thursday, Van Noten, a Belgian, said that the deal had been made to fuel the long-term growth of his namesake business.

As part of the partnership with Puig — which is primarily a fragrance group, although it also owns fashion brands with strong scent businesses, such as Carolina Herrera, Paco Rabanne, Nina Ricci and Jean Paul Gaultier — Van Noten will continue to be chief creative officer and chairman of the board.

The value of the sale of the majority stake, which came after months of talks with other interested parties, including several private equity firms,was not disclosed.

“I am delighted that we are beginning the next chapter of the Dries Van Noten company and my work as a designer alongside Puig, a company I have always greatly respected,” Van Noten said. “I have been searching for a strong partner for the company which I have built over more than 30 years. Together, we are now ready to realize our dreams.”

Until this week, Van Noten had been one of few founder-designers still in sole charge of a businessin the top tier of the luxury landscape. During a decadelong race, large holding groups like Kering and LVMH Moët Hennessy Louis Vuitton have scooped up many small labels and talent.

Van Noten was an original member of the Antwerp Six, the group of Belgians who transformed the city into a locus of avant-garde fashion in the mid-1980s. His designs are now sold at more than 400 outlets worldwide, offering menswear, womenswear and accessories lines. But he has only eight brand-name stores and a limited presence in the lucrative accessory market of shoes and handbags, all areas ripe for expansion. Annual sales for the company have never been disclosed, but industry observers estimate that they are 30 million to 60 million euros ($35 million to $70 million).

Van Noten is scheduled to show his men’s spring 2019 collection on Monday in Paris.

“We are beyond excited to partner with Dries Van Noten and his team,” said Marc Puig, chairman and chief executive of Puig. “We look forward to further developing the label, a brand renowned for exceptional creativity that has, over the years, built an exceptional reputation with its avant-garde fashion collections. We are proud to welcome Dries Van Noten to our fashion family.”

Unlike its far larger rivals Kering, controlled by the Pinault family; and LVMH, controlled by the Arnault family, which are both partially listed on the French stock exchange, the Barcelona-based Puig business remains fully owned solely by the Puig family.

With products sold in 150 countries, Puig posted revenues of 1.93 billion euros in 2017. The purchase of Dries Van Noten underscores Puig’s commitment to developing its portfolio of fashion brands alongside its lifestyle and fragrance businesses. However, the group, which has seen considerablecritical success with Paco Rabanne in recent years, has not been afraid to make difficult and unpopular strategic calls when it comes to preserving the bottom line. In 2015, for example, Jean Paul Gaultier shuttered its unprofitable ready-to-wear line.

And there have been whispers that a lack of investment in Nina Ricci has contributed to a fast turnover of designers: The house has had seven people in its top position in the 20 years since it was purchased by Puig in 1998. Carolina Herrera, the biggest fashion business in Puig’s stable, is largely powered by sales of its more accessible brand, CH Carolina Herrera, produced by license in Spain, and by its fragrances.

For Van Noten, who is known for both his attention to detail and concern for his employees, the sale of a majority stake in the business will most likely be something of a reliefas it will allow him to focus primarily on the creative side of his brand while remaining a significant minority shareholder.

“I am happy that Antwerp and my team will remain at the company’s heart and center,” he said. “Our relationship with our customers is a cherished one and will only benefit from this.”