The battle to gobble up luxury’s biggest players doesn’t seem like it’ll slow down any time soon. According to a new report from Bloomberg, Kering is in exploratory talks to purchase the beloved outerwear brand Moncler. Adding the booming label to its already considerable portfolio (which includes Gucci, Saint Laurent and Brioni) would be a boon that would double as a means of keeping competitors at bay.
Kering and its CEO Francois-Henri Pinault are hoping to persuade Moncler’s Remo Ruffini to make the sale––a necessary step as Ruffini’s investment company owns 22.5 percent of the company. Many see as Pinault’s attempt to remain competitive against archrival Bernard Arnault and his powerful LVMH group, especially after Arnault’s record-breaking purchase of Tiffany & Co.
Gucci now represents more than three-quarters of Kering’s operating profit even though it is among more than a dozen labels owned by the company. Acquiring Moncler would diversify its offerings and most likely add a healthy dose of revenue. The outerwear brand’s stock has risen 48 percent this year alone and has a valuation of around $12 billion.
Moncler has built its reputation on puffy coats, but contrary to logic, the narrow scope of its collection has been the key to its massive success. Its Genius collaborations are considered some of the industry’s most innovative, never ceasing to draw renewed attention to the brand just when things seem to go quiet. (It also recently signed Will Smith as a face of the brand, and partnered with Poldo on a line of coats for dogs.) Ruffini was instrumental in its recent prosperity and the one who made the decision to move toward an up-market model with exclusive shops from Los Angeles to Xi’an. Forty-nine of its more than 200 shops are in China, a nation whose consumers are helping to drive growth.
To ensure that Moncler doesn’t get stuck, the brand has added swimsuits, sneakers and other categories to its collection, but the heart of the business will remain its staple outerwear for the foreseeable future. Still, a purchase by Kering could yield even more surprises.