In a year shrouded by uncertainty, many brands have gone under or been sold off for a hefty profit. Most notably, VF Corporation acquired Supreme in a $2.1 billion deal this November. Now, Moncler follows suit, unexpectedly buying Stone Island in a transaction valued at €1.15 billion — about $1.4 billion — to grow the company as the pandemic erodes the demand for luxury.
Both Moncler and Stone Island have floated along in quarantine, profiting off the growing demand for sportswear and comfortable clothing. The deal comes as a surprise, however, considering the two companies had widely been perceived as rivals. Arguably, Moncler and Stone Island are the most dominant outerwear brands to ever emerge from Italy. The transaction, however, may be a move to rule as one.
What’s the deal? — Moncler has acquired 100 percent of Stone Island’s shares. 70 percent came from Stone Island’s parent company SPW, while the remaining 30 percent was bought from Singapore’s state investor Temasek. Moncler shares rose as much as 6.5 percent after the cash deal was announced.
For now, the two Italian brands will remain separate entities, though the acquisition will help the companies share information on how to best capture the American and Asian markets and amplify their direct-to-consumer channels. Moncler may also be able to help Stone Island improve its distribution, as it gets 77 percent of its revenue through its own network of 218 stores. Stone Island, on the other hand, only has 24 shops and gets three-quarters of sales from wholesale partners, according to Bloomberg.
There’s no "i" in Moncler — This expansion couldn't come at a better time, especially seeing as Moncler’s skiwear won’t be worn on the slopes this year. The brand, however, will use this time to work with Stone Island on sustainability, of which Moncler has been awarded the title of Industry Leader of the Textile, Apparel and Luxury Goods sector in the Dow Jones Sustainability Indices World and Europe for two years in a row.
Remo Ruffini, Chairman and CEO of Moncler, told Hypebeast, “I want to share [Stone Island’s] vision. We are just here to help with anything they need.” Moncler will focus more on expanding the two separate brands rather than molding one to fit the other. Its purchase of Stone Island will give the skiwear company a bigger presence in its home territory and a better look at what younger consumers want.
Carlo Rivetti, Chairman and CEO of Stone Island said in a statement, "Remo and I have decided to combine forces and visions to meet together and with greater strength than ever the challenges we all face. We share the same roots, similar entrepreneurial journeys, and the utmost respect for the profound values of our brands and our people. And we are Italians."
Blood runs thicker than water, and apparently, through the veins of these two companies. Now family, Moncler and Stone Island will redefine their separate ideas of luxury, and create a new vision together. We wonder what that will look like… probably expensive.