Photo/VCG

Dec. 22 (NBD) -- Pacific Global Management Group, owner of Italian luxury company La Perla, has agreed one-month exclusive discussions with China’s Fosun International Limited over the sale of a majority stake in the luxury lingerie company, according to Reuters.

Known as one of few historical fashion houses with a woman founder, the brand La Perla was founded by Ada Masotti in Bologna in 1954.

American private equity fund JH Partners LLC acquired a 70 percent stake in the luxury company in July 2007 and then gained full control of La Perla through the acquisition of the remaining a 30 percent stake in October 2008.

In June 2013, Italian entrepreneur Silvio Scaglia and Pacific Global Management purchased La Perla for 69 million euros (81.8 million U.S. dollars) at a court-led auction.

La Perla, which has 30 boutiques, reported sales of 140 million euros (165.9 million U.S. dollars) this year and is expected to break even by the end of 2018, Silvio Scaglia said in a recent interview with Forbes.

The conclusion of the deal is subject to Fosun’s approval, said Reuters.

It is noted that La Perla is not the first Italian luxury brand that Fosun eyes. In November, the Shanghai-based investment company has taken over a majority stake in Italian menswear brand Raffaele Caruso SpA, after buying 35 percent stake in 2003.

Moreover, Fosun also raised its holdings of German fashion brand Tom Tailor Holding AG, to up to 29.9 percent.

In July this year, Fosun and Beijing Sanyuan Foods Co., Ltd. announced to jointly buy all stakes in French cheese and yoghurt maker St Hubert for 625 million euros (740.6 million U.S. dollars).

With a market size of over 60 billion yuan (9.1 billion U.S. dollars), Chinese underwear market sees the annual sales of over 100 billion yuan (15.2 billion U.S. dollars), approximately 60 percent of which are contributed by lingerie sales, according to statistics from the website of China Textile Economic Information.

In recent year, due to the consumption upgrade in domestic market, more luxury brands are favored by Chinese capitals. On the other hand, companies with foreign luxury brands also seek for reliable Chinese investors in the purpose of making foray into Chinese market through applying resources of those financiers.

Cheng Weixiong, general manager of Shanghai Liangqi Brand Management Co., told NBD that though China has a large underwear market, yet the market share has been divided by small brands and no giant has emerged.

The middle and high-end markets are still at the early stage, he added.

Cheng further pointed out that changes in Chinese consumers' incomes and consumption concepts have lead to the increasingly personalized demands in the styles, fabrics and shapes of underwear. This creates not only chances for the development of domestic underwear brands, but also opportunities for international brands to enter Chinese underwear market, noted Cheng.

Email: zhanglingxiao@nbd.com.cn