Temasek & The Italian Connection

1 August 2016

Temasek, the Singapore investment company, has announced its first equity acquisition in an Italian company. 

Along with Juan Carlos Torres, investor and chairman of the travel retail group, Dufry, the investment agreement aims to support the development of Italian firm Moncler SpA into potentially one of the world’s leading luxury groups.

The two long-term orientated investors acquired their stake in the Italian/French luxury company – seller of high-end outerwear and apparel - via the newly incorporated investment company from Ruffini Partecipazioni called Newco.

Following the exit of Clubsette, Newco will hold a 26.8 per cent stake in Moncler.

Clubsette S.r.l. (an investment vehicle controlled by Tamburi Investment Partners) currently owns 14 per cent of the corporate capital of Ruffini Partecipazioni. Once Clubsette exits Ruffini Partecipazioni it will receive a 5.1 per cent direct equity holding in Moncler, as reimbursement and liquidation of its original.

Chairman and CEO of Moncler, Remo Ruffini, will remain the single largest and controlling quota holder of Newco - through Ruffini Partecipazioni - and will continue to define and drive Moncler’s plans for future development, the investment company said.

The investment agreement is expected to be effective from 3 August 2016 and includes a shareholders’ agreement to be executed on that closing date by Ruffini Partecipazioni and the Investors as quota holders of Newco.

Speaking on the acquisition, Head of Europe for Temasek, Tan Chong Lee, said:

“This investment represents Temasek’s largest commitment to an Italian company to date. Italy is home to leading consumer and industrial businesses that [have] considerable export and international growth potential.”

While having been established in Grenoble, France, in 1952, Moncler operates in over 70 countries including EMEA, Asia and the Americas; through a network of mono-brand stores and major exclusive luxury department and multi-brand stores.

Senior Managing Director for Europe and Joint Head of Consumer at Temasek, Luigi Feola said:

“We are pleased to gain exposure to Moncler... we welcome the opportunity to work alongside our partner Remo Ruffini and to support Moncler in the long term as it continues its global expansion.”

Temasek added that it sees opportunities in leading European companies looking to expand and diversify their export markets to growth economies in Asia, Africa and Latin America – unsurprisingly, including those consumer companies where there’s strong appeal around their brands in markets such as China.

Commenting on the new partnership Remo Ruffini said:

"In Temasek and Juan Carlos I have found what I have been seeking as I look toward the future phases of Moncler’s development: committed, supportive, knowledgeable and ambitious strategic partners… they also have strong economic alignment of interest with all of Moncler’s institutional and individual shareholders."

The company invests over the long term around the following four key investment themes: growing middle income populations, transforming economies, deepening comparative advantages and emerging champions.

"Our commitment to the group’s successful growth and development reflects our admiration for what Remo and his team have achieved... and our faith in the group’s outstanding prospects for the future", Dufry chairman, Juan Carlos Torres said.

Temasek argues that, by investing in companies that cater to one or more of these themes, it has become a provider of capital that can help companies, at various inflection points of growth, to meet the challenges aligned with its investment themes. It added that the themes also reflect its perspectives on long term trends.

Temasek was incorporated in 1974 and has a S$242 bln (Sd) (180 bln usd; 158 bln eur; HK$1.40 trillion (HKd); 125 bln gbp) portfolio at 31 March 2016.

The investment firm’s portfolio covers telecommunications: media & technology; financial services, transportation & industrials, consumer & real estate; life sciences & agriculture and energy & resources.

Temasek’s compounded annualised Total Shareholder Return (TSR) since inception in 1974 is 15 per cent in Singapore dollar terms, or 17 per cent in US dollar terms. It has had a corporate credit rating of AAA/Aaa since its inaugural credit rating in 2004, by rating agencies S&P Global Ratings and Moody’s Investors Service respectively.

Temasek has offices in Singapore and nine other cities around the world, including London, covering Europe: New York, São Paulo and Mexico City in the Americas. Beijing and Shanghai in China, Mumbai and Chennai in India and Hanoi in Vietnam.

Ingrid Smith is a senior content strategist, storyteller & mentor