June 6, 2011 / 7:54 AM / 8 years ago

UPDATE 3-Moncler drops IPO plans after Eurazeo buys stake

* Eurazeo to buy 45 pct of Moncler for 418 mln euros

* IPO still on the cards but not in coming months

(Adds more Eurazeo comments, source comment, background)

By Helen Massy-Beresford and Kylie MacLellan

PARIS/LONDON, June 6 (Reuters) - Moncler sold a stake to investment company Eurazeo (EURA.PA), allowing the upscale clothing maker to sidestep a rocky market for European listings which would have likely demanded it be sold at a big discount.

The French company, which had been due to begin roadshows for its Milan listing this week, agreed to sell a 45 percent stake to Eurazeo for 418 million euros ($612 million), giving it the funds it needs without submitting to a risky flotation.

The European IPO market has had a difficult year, with many deals being pulled and most of those that have been completed trading below their offer price — making investors increasingly unwilling to buy new offerings unless they are cheaply priced.

“Moncler received what we understand was an unsolicited bid for a stake, at a valuation that was at a significant premium to what was likely to be able to be achieved in the IPO market,” said a source close to the deal on Monday. “The discount that the public market is demanding is relatively high.”

The announcement comes a few days after Moncler got the go-ahead for its IPO and as Italian fashion house Prada prepares for a listing in Hong Kong that could raise up to $2.6 billion. [ID:nLDE74T130] [ID:nL3E7H600K]

Eurazeo, which has a portfolio of over 4 billion euros including shareholdings in companies such as hotels group Accor (ACCP.PA) and wholesaler Rexel (RXL.PA), said the deal gave Moncler an enterprise value of 1.2 billion euros ($1.8 billion).

Moncler said: “The company and its shareholders believe that the entry of Eurazeo constitutes the best way to pursue the Moncler group’s growth strategy and development of its brands to come to the market in the near future.”

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Eurazeo executive board member Virginie Morgon told a conference call an IPO remained “extremely attractive” for the company and was a medium-term objective.

Despite suggestions the sale had been a last-minute decision, Morgon said the project had been in the works for some time.

“We have been working on this investment project for several months in parallel with an IPO plan which was known about and had been announced by the company. We have taken advantage of a market environment that was much more complicated for the IPO. We were able to benefit from that opportunity.” Remo Ruffini, Moncler chairman and creative director, will retain a 32 percent stake in the company and U.S. private equity group Carlyle [CYL.UL] a 17.8 percent stake, Eurazeo said.

Ruffini, who will remain chairman of the board of directors, previously held 38 percent and Carlyle 48 percent.

Eurazeo will appoint five out of 10 board members including the vice-chairman, Ruffini will appoint three and Carlyle and Brands Partners 2 one each.

Moncler, which was founded in Grenoble, France in 1952, reported 2010 revenue of 429 million euros, net income of 52 million euros and EBITDA of 102 million. [ID:nLDE73426H]

Its jackets, first sold in Alpine ski resorts such as Cortina and Chamonix, are now found in the hip shopping streets of cities such as Paris, London and Tokyo. (Additional reporting by Cyril Altmeyer and Valentina Za; Editing by Jane Merriman and David Holmes) ($1=.6829 Euro)

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