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Braccialini approves €10 million capital increase to grow abroad and invest in new stores

by Silvia Pieraccini

Braccialini is focusing on growth with determination and new investments. The Board of Directors of this Florentine brand of leather goods, founded in 1954, has recently approved the recapitalization of the company, which will be underwritten pro quota by the current shareholders: the founding family for 22% and by the private equity fund Sici for 33% and Hat e Nem for 22% each, in addition to the business plan until 2018.

A listing on the stock exchange has been set aside, as has the hypothesis of an exit shortly from the investment fund which opened the door to some takeover bids that came, above all, from abroad (Asia, in particular).

“There were some very important offers among these, but in the end we chose a different plan,” explains CEO Riccardo Braccialini, son of the founders of the company made famous by the ironic style of its creations, and that has just celebrated its 60th anniversary. “This different plan includes also the postponement of the listing on the stock exchange, because we still want to grow. We will continue with the same corporate organization, focusing on raising our position and improving our margins,” he says.

The resources available from this capital increase - €5 million before the end of the year, another €5 million next year - will be used for the development of Braccialini and Gherardini, the Braccialini group’s most important brands, and “represent a positive sign to the market,” underscores the CEO.

This restart in investment is necessary to give the group a new direction, after Braccialini’s involvement in the collapse of the Mariella Burani group, to which it belonged. After concluding the recovery plan, the group has renewed its management and credit lines were reopened. Now, with the arrival of capital, a decisive change is expected.

The forecast of the business plan is to resume double-digit growth already this year, after 2014 closed with revenues near €60 million (70% from exports), a decline of 10% due to “cutting off dead branches,” that is, of multi-brand retailers in Europe and in the Mediterranean area, and because of the impact of the Russian crisis, an area in which Braccialini is strong. From 2017 then the EBITDA should once again rise, helping growth even more.

“Our reference markets remain the United States, Japan and China,” explains Riccardo Braccialini, who is working on the acquisition of a new license for the production of a line of men’s leather goods.

To aid growth, the company is looking abroad and at retail.

“The investments that we are making,” adds Braccialini, “point to a higher repositioning of the brand. The way to shop has changed in all of the Western world, and the business plan must consider these new trends.”

The strengthening of the dollar could give a push to exports, according to the CEO, even if, “the advantage in the exchange rate won’t be noticeable before six to twelve months. In reality, the sales are slowing down in all of the foreign markets, including China,” concludes Braccialini, “and the Russian tourists that were buying Italian fashion brands have almost disappeared.”

In 2015, meanwhile, the celebrations continue for the 130th anniversary of Gherardini, another important brand for the group, that has presented the “nuova Piattina” bag, a contemporary version of one of the bags that made the brand famous in the 1980s, and that will be put on show in the boutique in via Spiga in Milan, so as to be appreciated by the global shoppers expected in the city for Expo Milano 2015.