Tod’s Founding Family to Take Luxury-Loafer Maker Private
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The family behind luxury Italian shoemaker Tod’s SpA said it plans to take the company private as part of an effort to boost growth at the maker of high-end loafers. Chief Executive Diego Della Valle and his family on Wednesday said they were offering to pay 40 euros a share, equivalent to $40.67, to acquire 25.55% of the company’s stock and increase their holding to 90%. The acquisition would cost the family €338 million and value the company at €1.32 billion. Luxury giant LVMH Moët Hennessy Louis Vuitton SE currently holds 10% of Tod’s shares, and would continue to own a 10th of the company after a proposed delisting from the Milan Stock Exchange. “The Della Valle family has decided to make a big investment in the Tod’s Group in order to accelerate its development,” the family said in a statement. It added that delisting would free the company of “limitations” imposed by its 22-year status as a publicly traded firm. The family said the move would also allow it to give other brands within the group, which include Hogan and Roger Vivier, more visibility and autonomy. At a time of booming spending on luxury goods, sales at Tod’s—best known for its Gommino loafers—have failed to keep pace with industry leaders like LVMH, analysts say. Tod’s increased its sales last year relative to a Covid-19-hit 2020, but revenue of €883 million was down 2.7% compared with 2019. By contrast, LVMH’s 2021 sales rose 20% relative to 2019.
The Swiss stock market turned positive on Wednesday afternoon in the wake of surprisingly positive US data. The SMI climbed 0.5 per cent to 11,179 points. Among the 20 SMI stocks, there were 17 price gainers and three price losers. 26.91 (previously: 38.66) million shares were traded. Roche gained 0.7 per cent; the pharmaceutical group has concluded a licensing agreement with the US biotechnology company Poseida Therapeutics. Financial stocks were supported by positive business figures from competitors Societe Generale and Commerzbank, and insurer AXA also presented convincing business figures. In Switzerland, UBS and Partners Group rose 1.0 and 2.3 per cent respectively, while Swiss Life gained 1.5 per cent. Credit Suisse (+0.1%) lagged with negative analyst commentary. Strong data from China fuelled prices in the luxury goods sector, with Richemont and Swatch up 1.4 and 2.1 per cent respectively. The business figures of the conglomerate Oerlikon were significantly better than expected, the share price gained 4.2 per cent. Both profit and turnover as well as incoming orders were better than expected.
European stock markets closed higher on Wednesday as fears of a US recession eased slightly after a better-than-expected services sector report. However, geopolitical concerns remain after House Speaker Nancy Pelosi visited Taiwan. The Stoxx Europe 600 index gained 0.5% on Wednesday to 438.3 points. The CAC 40 and the SBF 120 rebounded by 1% each. In Frankfurt, the DAX 40 gained 1% and in London, the FTSE 100 rose 0.5%. Most car makers have stuck with their existing travel schedules this earnings season, reassuring investors worried about weakening demand. Not BMW. Bayerische Motoren Werke, as the Munich-based company is formally known, broke its habit of not surprising the market Wednesday by downgrading its outlook for full-year free cash flows to “at least €10 billion,” equivalent to $10.2 billion, from a previous estimate of at least €12 billion. It blamed two factors: weak production due to the continuing shortage of semiconductors and higher spending on electric vehicles. Société Générale SA said Wednesday that it swung to a second-quarter net loss as it booked losses from its disposal of Russian assets. The French lender reported a net loss of 1.48 billion euros ($1.50 billion) compared with €1.44 billion net profit a year earlier. Net banking income, its top-line figure, came in at €7.07 billion for the quarter, up 13% from the year prior, the Paris-based bank said. Its operating profit rose to €2.39 billion from €2.01 billion.
U.S. stocks rose Wednesday, the major indexes' first winning session in August, on the strength of fresh earnings reports and a key reading on the services sector. The S&P 500 rose 63.98 points, or 1.6%, to 4155.17, recouping some losses after falling Monday and Tuesday. The Dow Jones Industrial Average added 416.33 points, or 1.3%, to 32812.50. The technology-heavy Nasdaq Composite gained 319.40 points, or 2.6%, to 12668.16. A key economic report also helped spur the market's gains. The U.S. services sector continued to expand in July, according to a report from the Institute for Supply Management. The ISM's index of conditions for businesses such as restaurants, hotels and retailers hit a three-month high in July. After opening August with two straight losing sessions, stocks gained on "generally upbeat risk sentiment," said StoneX Financial analyst Matt Weller. The earnings and ISM report have mitigated fears of an imminent recession, he said. corporate news, PayPal shares jumped $8.29, or 9.3%, to $97.92 after hedge fund Elliott Management confirmed it has a $2 billion stake in the payments company. Starbucks rose $3.56, or 4.3%, to $87.27 after it said demand is still strong and raising prices partially offset higher labor costs. Vaccine maker Moderna rose $25.68, or 16%, to $186.49 after it posted earnings above analysts' estimates and said it would begin a new $3 billion share-repurchase program. Airbnb declined $1.32, or 1.1%, $115.02 after it said it swung back to profit but its outlook disappointed investors. Online dating group Match tumbled $13.47, or 18%, to $63.24 after posting results that missed estimates and said the CEO of its Tinder platform is leaving the firm. Chip maker Advanced Micro Devices fell $1.20, or 1.2%, to $98.09 after it reported a drop in profit and issued guidance for the current period that was below Wall Street's expectations.
Most stock markets in East Asia and Australia are also moving higher on Thursday thanks to very firm support from the US stock markets. However, in many places the indices come back from their highs after it became known that Chinese missiles - presumably drones - had penetrated the security zone of the Kinmen Islands, which belong to Taiwan. On the Taipei stock exchange, prices fall by an average of 1.4 per cent. In Shanghai, the composite index gave up most of its gains and is still up 0.1 per cent.
The yield on the benchmark 10-year Treasury note inched up to 2.747% from 2.740% Tuesday. Weak economic data have weighed on yields in recent days, said an analyst. There are "raised concerns that the U.S. economy could well be slowing sharply".
UBS raises DWS target to EUR 27 (25) – Neutral
JPM raises HSBC target to 570 (550) p – Neutral
JPM raises IAG target to GBP 1.30 (1.25) – Neutral
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