LVMH-backed Private Equity Firm on Buyout Mission?

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Gant's flagship store in London. Gant is one of L Capital's investments.

Paris—Analysts were buzzing today across Europe and Asia on speculation about which brands or retailers L Capital Management, a private equity firm backed by LVMH, may buy or invest in.

Last Friday, L Capital Management announced it had raised it raised 400 million euros (about $527 million) for its latest fund L Capital 3, exceeding its target for 350 million euros.  The company said it would use the funds to invest in “mid-market European lifestyle brands and retail” particularly those in Asia and South America that were “aspirational, affordable and alternative.”

“Changing demographics, consumer behavior and emerging new market segments in mature economies in Europe and the U.S., an increasing wealthy middle-class and emergence of important, powerful economies in China, India, South-East Asia and South America create significant demand for lifestyle brands,” said Philippe Franchet, a senior partner at L Capital.

Looking for ‘World Calls Brands and Retail Businesses’

One of the rumored first targets according to reports today would be Raymond Ltd., an Indian apparel and fabric company, which reportedly might receive some $150 million stake from L Capital. But the company said it had no such proposal before its board of directors.

According to Daniel Piette, chairman of L Capital, it would be working in concert with and drawing upon resources and expertise of LVMH, Groupe Arnault and L Capital Asia, a sister fund focused on Asia with offices in Singapore, Mumbai and Shanghai. No disclosure was made on what portion of L Capital’s funds came from LVMH and Groupe Arnault.

“L Capital Management’s goal is to develop world-class brands and retail businesses benefiting from growing global consumption trends,” said Piette.

L Capital 3 intends to invest in a portfolio of 10 to 15 companies with either majority or minority stakes.  Its previous investments include Gant, Nutrition & Sante, Pepe Jeans and Princess Yachts.

According to L Captial, we “drive fresh momentum for our companies by repositioning and broadening their offer, expanding the distribution network and pursuing international development opportunities, enabling them to enter a new phase of dynamic growth.”

Capstone Partners acted as placement agent for the fund, marketing in North America, Europe, the Middle East and Asia.