On Friday, the CEO of Tod’s, the renowned Italian luxury group celebrated for its leather-driving loafers, declared that his family has no intentions of selling the company. This statement comes in the wake of an unsuccessful endeavor to delist the company from the Milan Stock Exchange in 2022. Diego Della Valle, the son of founder Dorino and grandson of founder Filippo, emphasized his commitment to safeguarding the familial essence and heritage of the business.
Della Valle was speaking on the sidelines of the Milan Fashion Week, where Tod’s presented its first collection by new creative director Matteo Tamburini. The new boss took over from Walter Chiapponi in September and has been revamping the brand’s collections. Tod’s Group revenues were up 11.9 percent in the first nine months to 1.13 billion euros.
Tod’s has been working to modernize its manufacturing operations and reduce overhead costs to compete with bigger luxury rivals. The family hopes to continue growing its businesses, including Roger Vivier and Fay. But Della Valle acknowledges the challenge ahead in a market where big finance groups are taking over many luxury companies.
Despite the challenges, Della Valle remains committed to his family’s vision of “making the world a better place” by producing quality products. That’s why his father started the company 67 years ago. He wanted to make shoes that were as beautiful on the inside and outside.
The family’s last attempt to take Tod’s private was a joint venture with investment firm L Catterton, an investor effectively allied to the Arnault family. Under the terms of the deal, Crown Bidco, an affiliate of L Catterton, plans to buy 36 percent of Tod’s share capital, or almost 13 million shares, at 43 euros per share. This is a 17.6 percent premium to the share price as of Feb. 9 (the day before the deal was announced), according to data compiled by research group Stifel.
Under the delisting plan, the Della Valle family will maintain a 54 percent company share. In comparison, L Catterton would indirectly own 36%, and LVMH subsidiary Delphine SAS would hold 10%. If the bid is accepted, Della Valle will also be granted governance and exit rights in the company.
Tod’s has a devoted following of consumers willing to pay a premium for a well-made product. The brand, however, has yet to prove that it can compete with global giants in China and the United States. It will be interesting to see whether the delisting operation will help the company become a more competitive force. Tod’s is already a coveted name for luxury goods, but it needs to show that it can compete with the big players in the fast-changing market.
