Investindustrial and The Carlyle Group (NASDAQ: CG) today announce their intention to create a global high-end interior design group that brings together a collection of powerful and complementary brands. Financial details of the transaction remain confidential however the group will be the largest global high-end design group with a European heritage, with combined sales exceeding €500 million.
Investment funds controlled by Carlyle and Investindustrial will own equal stakes in the new group and will invest alongside the founders of B&B Italia, the Busnelli family, and Flos founder, Piero Gandini, who both retain minority stakes. Upon completion of the transaction, Piero Gandini, CEO of Flos, will be appointed Chairman of the new Group while Giorgio Busnelli, B&B Italia’s Chairman, will become Vice Chairman.
The transaction is expected to close before the end of the year subject to customary anti-trust and regulatory approvals. The new group will be one of the first of its kind, focusing on the high-end design market. Initially, it will consist of three complementary companies, currently owned by Investindustrial – B&B Italia Group in furniture and Flos and Louis Poulsen in lighting - all of which will be transferred to the new group.
All three companies are established and well regarded for their unique, iconic products, notably including B&B Italia’s Up chair by Gaetano Pesce, the Arco lamp designed for Flos by the Castiglioni brothers, and Louis Poulsen’s PH 5 lamp, designed by Poul Henningsen.
With the strong financial backing of Carlyle and Investindustrial, the group will pursue further acquisitions in adjacent niches of the high-end interior design market, which despite its global appeal is a market which remains highly fragmented. During Investindustrial’s ownership, in the last four years, Flos has made three acquisitions including outdoor lighting specialist Ares, and B&B Italia has acquired high-end kitchen manufacturer Arclinea as well as the archives of the renowned designer Luigi Caccia Dominioni and his co-founded brand, Azucena.
Piero Gandini, Chairman of the new group and CEO of Flos, said: “This project stems from the idea to bring Italian design, historically characterized by family entrepreneurship, to a new stage in the international arena. I am sure that the great cultural legacy of our design history will be successfully projected globally, demonstrating its development and heritage as has already happened in other “Made in Italy” sectors such as food and fashion. I am so pleased that a project of such importance arises from the partnership of two investment firms like Investindustrial and Carlyle, which have always stood out for their strong entrepreneurial culture and global approach to growing businesses.”
Andrea C. Bonomi, Chairman of the Investindustrial Advisory Board, said: “Design is a key sector for Italy but one where most companies are still sub-scale. We are therefore delighted with our work over the past four years alongside highly experienced entrepreneurs such as Piero Gandini and Giorgio Busnelli for the growth, organic and through acquisitions, of Flos and B&B Italia. Today, thanks also to the recent acquisition of Louis Poulsen, the design group has reached a critical size that we believe represents a good starting point for the launch of a new important phase of further significant international development and growth. Looking ahead, we will work to combine the expertise of these entrepreneurs alongside our industrial approach and now also through the global presence of our new partner Carlyle. Our shared goal will be to establish a leader in high-end design globally.”
Marco De Benedetti, Managing Director and Co-Head, Carlyle Europe Partners, said: “The high-end design market is very attractive with compelling long-term growth prospects. We are pleased to team up with Investindustrial to continue to build on their investments and create a new high-end design group. The brands will now have the potential for greater geographical reach, access to enhanced sourcing and distribution networks and they will also have the ability to better adapt to market evolution and the changing expectations of international customers.”
Giorgio Busnelli, Vice Chairman of the new group and Chairman of B&B Italia, said: “Sharing an important entrepreneurial project and approach to growing businesses was key to the partnership signed with Investindustrial three years ago. Since then, B&B Italia has successfully achieved a growth path also through acquisitions. With today's agreement we are entering a new phase of the development plan that we had envisaged. From today we are part of a group that, with the joint support of Investindustrial and Carlyle, wants to establish itself on a global scale, allowing us to become more relevant in high-end design at an international level.”
Advisors on the transaction were JPMorgan and Lazard (financial), Latham Watkins (legal advisor to The Carlyle Group) and Chiomenti (legal advisor to Investindustrial).
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