Borletti Group

Private Equity

Operating from London and Luxembourg, Borletti Group’s Private Equity division is a team of successful managers with entrepreneurial, industrial and financial backgrounds. The team has expertise of investing in three core sectors: retail, luxury/branded consumer goods and real estate with a retail component.

Over the last eight years, Borletti Group has led acquisitions that total over €6bn:

  • - 2005: la Rinascente (Italy), €0.8bn
  • - 2006: Printemps (France), €0.9bn
  • - 2008: Karstadt (Real Estate), €4.5bn
INVESTMENT STRATEGY

Borletti Group makes investments in buy-outs, acquiring stakes in mid-sized companies within its core industry sectors.
These investments typically include leveraged buyouts and other types of private equity transactions, including co-investments. Borletti Group differs to many other private equity groups because it adjusts its investment horizon to suit the investment needs of the acquired company. This means that there are no maturity constraints on exit time, an approach that has resulted in an excellent track record of returns for co-investors.

INDUSTRY FOCUS

Borletti Group focuses on three core sectors:
- Retail with a particular focus on department stores
- Luxury and branded consumer goods
- Real estate with a retail component

VALUE CREATION
box PRIVATE EQUITY value creation

Borletti Group has a deep understanding of the sectors in which it invests. The Group brings a strong entrepreneurial approach to its investments and works with leading management teams to realise the full potential of the portfolio companies. The Group takes an active role in all investments, leveraging its network in targeted industries and using specific knowledge of industries to create a bespoke approach that gets results. Its aim is to act as support and accelerator of the company CEO and the management team. However, while Borletti Group participates in key strategic decisions it does not take a direct management role, leaving company management in charge of the day-to-day running of the business.

Borletti Group’s role with both Printemps and la Rinascente proves that this is a winning approach. In both cases, Borletti Group played an active role in driving the business plan and successfully:

  • • Increased sales by working alongside management in:
    • - Store and concept repositioning,
    • - Refurbishing to keep pace with the market
    • - Bringing in high performance brands
  • • Enhanced the value of the real estate assets by requalifying the underlying operations, increasing sales, profitability and subsequently rent.

Case Studies

La Rinascente

- March 2005: Acquisition of la Rinascente from IFIL / Auchan
Leading Italian department store with over €300m sales, 5,500 employees and a prime real estate portfolio
- Competitive auction with over 35 participants
- Borletti Group’s equity partners: Deutsche Bank, Pirelli, Investitori Associati
- 2005-2011: Strategy of revamping the stores, through major investments and of product category reallocation that led to a successful repositioning of la Rinascente
- June 2011: Sale of la Rinascente to Central Retail Corporation (Thai retail group)
- Over five times equity return

How Borletti Group made a difference

- Played a key role in the acquisition phase with the seller and its advisors
- Used its expertise to help the business
- Accessed its network and contacts to build a consortium involving some of the most prestigious and prominent private and institutional investors
- Delivered credibility with regards to unions, media and other institutions
- Decided the constitution of the management team
- Led important negotiations with key brands

Results 

- Significant sales improvement confirmed the success of the new brand strategy for
la Rinascente (+9.4% net sales in 2008)
- Unsuccessful own brands were replaced by “A-brands”

Printemps

- October 2006: Acquisition of “Printemps” from PPR Group
Leading French department store chain with €950m sales, over 5,000 employees and a prime real estate portfolio.
- Proprietary confidential acquisition process with only three participants.
- Borletti Group’s equity partner: Deutsche Bank.
- 2006-2013: Major investments to revamp the stores and product category reallocation leading to a successful repositioning of the group.
- July 2013: Sale of Printemps to Qatari investor (sales having reached €1.3bn).
- Over six times equity return.

How Borletti Group made a difference

- Played a key role in the acquisition phase with the seller and its advisors.
- Used its great expertise to help the business.
- Built a consortium involving some of the most prestigious and prominent private and institutional investors.
- Delivered credibility with regards to unions, media and other institutions during the acquisition phase.
- Identified the CEO and decided the constitution of the management team.
- Led negotiations with key brands.

Results 

- Successful repositioning of store network including the flagship store leading to a significant increase in sales productivity per square metre.
- Operational improvement leading to a four point increase in profitability.

Asset Management

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Real Estate

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