La Perla CEO on Brand’s Restructuring, Public Listing
MILAN — “There is something magical about La Perla.”
Despite this abstract quality, group chief executive officer Pascal Perrier expressed a razor-sharp focus on the steps that need to be taken to restructure the brand. “We have to go back to the fundamentals,” he told WWD on Wednesday, following the revelation earlier in the day that La Perla Fashion Holding N.V. planned to list its shares on the Euronext Growth Market, operated by Euronext Paris. Trading is expected to begin on or around Sept. 6.
No capital will be raised in connection with the listing, either through a public offering or a private placement of the shares, which will be priced at 4.50 euros.
The listing is a way of increasing the company’s visibility “and enhancing access to capital,” said Perrier of the Italian luxury lingerie, nightwear and beachwear specialist.
La Perla’s market capitalization will be 473 million euros once it’s listed.
“The main reason for the listing is that the Dutch holding [N.V.] is planning to grow its investments in the luxury sector through the acquisition of companies in that sector,” said Perrier, although he clarified there are no specific projects at the moment. “The first step is to prepare the holding to further invest having access to capital; this has nothing to do with La Perla which is fully funded.”
The second reason, he said, is that “some investors are interested in La
Perla’s strategies as a brand and are looking to invest in it. The Paris stock market is the best way” to achieve that, according to the executive.
Perrier, who joined La Perla in August last year, relies on almost 30 years of experience in luxury firms ranging from Celine to Yves Saint Laurent, Balenciaga and Burberry, “always during these brands’ transformation, integration and growth,” he said.
Perrier said he could “not resist” the appeal of La Perla, “an incredible brand with an incredible awareness, a leader in the luxury lingerie area and with strong Italian heritage.” He said the label had been impacted by three different ownerships throughout 20 years and, despite its “financial distress” had “something magical and an incredible resilience.” Previous owners, he believes, neglected two fundamentals: structure and customer evolution, as well as what the brand stood for. “Simplifying and investing in the backbone” of the company are his priorities, adding that on Wednesday morning he had hired a chief financial officer and a chief commercial officer, “with more talent to come.”
Investments are also being channeled into operations and La Perla’s supply chain to “deliver quickly, be agile and engage customers.”
Perrier did not agree with the diversification into different categories and labels under the previous owners, citing La Perla Studio or the Jeans line and the efforts to build La Perla into a fashion luxury brand that ranged from ready-towear and handbags to shoes. The company has also shuttered its men’s wear division. “These operations were costly and did not resonate with the brand’s luxury positioning, delivering very little results at the top-line level to the detriment of what the brand is,” he contended. That said, Perrier did not wave away potential future developments, but his efforts now are aimed at consolidating the fundamentals of the brand, structurally and commercially.
Although La Perla has not adapted to the evolution of luxury, Perrier opined, the brand’s equity is “incredibly strong, disproportionate with the size of the company.” Listening to customers has been key and they say that style and fabrics “have not evolved much,” he noted, despite women’s different and more active lifestyles. “We hired an anthropologist to understand women in detail,” he revealed. “Of course, we won’t walk away from our classic offer and customer, but at the same time we want to make classic and occasional more usable, occupying smaller moments of women’s lives, to make La Perla more affordable in terms of usability, not price.”
Quality is a given, “with no compromises,” leveraging Italian craftsmanship — “the reason we are so famous,” he said. But at the same time, the company is working on comfort and fit, for more practical, everyday use in luxury. As an example, he said La Perla had not been employing washable silk. “Why not? It exists,” he emphasized.
Although the operational headquarters are now in London, La Perla’s design, research, development and production facilities continue to be located mainly in Bologna, Italy. The company plans to streamline its logistics to reduce its time-to-market and increase the capacity of La Perla’s production in the Italian city. As reported, the company said in June that it was rationalizing its structure to focus on its core business. While pledging to keep production at its headquarters in Bologna, the company had planned to let go of 126 employees out of a total of 400. A month later the company said it was working on presenting a new industrial plan to unions, and job cuts were suspended for the time being. At the end of July, Italy’s Ministry of Economic Development asked La Perla’s management to submit a new plan to help safeguard the brand and its ties to Bologna.
Perrier was open to discuss the future of La Perla’s Bologna factory. “This was not a cost exercise,” he said of the planned job cuts. On the contrary, it reflected the evolution of the company’s business model, he said. Dismissing categories deemed no longer relevant inevitably led to redundancy plans, he explained. Referring to the suspension of this plan in July, he clarified that local unions asked management for more time to work on it, in light of the summer break.
“We are committed to working very closely with the unions and find the best way to handle a difficult situation. We remain a large employer in Italy.
Yes, the restructuring will impact 126 employees, but for the remaining it’s a matter of survival. Our ambitious plans will allow us to deliver profits and continue to employ. I am convinced that our approach is the right one and that it will allow us to grow. The luxury lingerie sector is unexplored and underserved and La Perla has great legitimacy.”
While mainly a retail company, management has started to “remove stores that are not relevant, in wrong locations or far too big and expensive, out of proportion and not justified,” set up to display a range of products that no longer exists. Perrier is looking at expanding the brand’s retail network, particularly in high growth and high margin markets, and “reinstating and modernizing” its marketing program, increasing investments in digital communication to enhance its e-commerce capabilities.
As of June 30, the company had 70 boutiques around the world, 44 of which are directly operated. There are 36 shopin-shops as well as 24 directly operated outlet stores. The brand is also available via e-commerce channels, including an online shop at laperla.com.
The luxury customer “has access to everything,” and Perrier sees La Perla as “the ultimate step to indulge in more intimate luxury.”
The Amsterdam-based private equity firm Sapinda Holding B.V. took over La Perla in February 2018. Last year, La Perla also promoted Alessandra Bertuzzi to head creative designer after the departure of Julia Haart.
Sapinda Holding bought 100 percent of the company from the Italian entrepreneur Silvio Scaglia, who had controlled La Perla since 2013.
As part of its new course, La Perla revealed plans in May to increase its capital by 23 million euros, offering 5.1 million newly issued shares to external investors. The board approved the issuance of the shares based on an equity valuation of 450 million euros.
La Perla was founded in 1954 by corsetry maker Ada Masotti. Her son, Alberto Masotti, headed the business until it was sold to San Francisco-based private equity player JH Partners in 2007, which later passed the firm on to Scaglia’s Pacific Global Management.
In July, British couture house Ralph & Russo welcomed a new partner in La Perla Fashion Investment BV, which has taken a $50 million, non-controlling minority share. Perrier is joining the board of that company in a non-executive advisory capacity.
La Perla describes itself as a wholly owned subsidiary of Tennor Holding B.V., a global investment holding company that takes majority and minority stakes in public and private firms, as well as in public and private debt instruments. It is also an indirect majority shareholder of La Perla Global Management U.K. Ltd., the head office of the La Perla operating entity.
The listing will help increase the company’s visibility as ceo Pascal Perrier develops business focusing on the brand’s core innerwear category. “…We won’t walk away from our classic offer and customer, but at the same time we want to make classic and occasional more usable…”