Why did Richemont just buy Delvaux? The luxury leather handbag brand will join fashion labels Cartier and Dunhill in an estimated US$300 million deal
- Formerly owned by Hong Kong billionaires Victor and William Fung, and Singapore’s Temasek Holdings, the Belgian brand is known for its US$4,800 Brilliant bag
- Citigroup analysts state that the group has a problem with soft luxury over jewellery, so could acquiring the brand – worn by Belgian royals – give it a boost?
Richemont has acquired Belgian leather-goods label Delvaux, adding a niche handbag maker to a line-up of luxury brands that includes Cartier and Dunhill.
Delvaux was controlled by Hong Kong billionaire brothers Victor and William Fung as well as Singapore’s Temasek Holdings. The brand is known for bags like the US$4,800-and-up Brilliant, which features a top handle and a buckle lock.
Richemont didn’t disclose terms of the transaction but said the deal will have “no material financial impact” on the Swiss firm’s assets or operating results. Shares in Richemont rose 0.8 per cent in early trade-in Zurich on Thursday, July 1.
The move is “consistent with Richemont’s desire to grow in the leather accessories segment”, according to Thomas Chauvet, an analyst at Citigroup, adding that the estimated cost of the deal could be as much as 250 million euros (US$296 million).
“A problem for Richemont remains soft luxury, where the company has underperformed for over a decade,” Chauvet said, referring to the segment that includes fashion and leather goods as opposed to jewellery.