Ermenegildo Zegna’s landing on Wall Street is upon us. The initial public offering has already attracted attention – and funds – from investors including Patrizio Bertelli, CEO of Prada. The clothing company was founded in 1910 in Triverso in the province of Biella and the Spac which belongs to the fund Investindustrial by Andrea Bonomi, a special purpose acquisition company sponsored by investment firms of Investindustrial VII LP, announced in a statement that it had agreed “with some large institutional investors and others” on an additional private investment in a public equity (PIPE) facility until to $ 125 million “to meet most of the demand”. This step was agreed following “private requests from various investors” who expressed interest in the business combination between IIAC and Zegna. For privacy reasons, the names of the investors were not disclosed.
The listing on the stock exchange
IIAC raised a total of $ 402.5 million gross in its IPO. To avoid diluting the existing pool of shares and reducing their value, investments in the new PIPE structure would be limited to the amount of redemptions by IIAC’s public shareholders. “If the redemptions exceed a certain threshold, the underwriters of the new PIPE structure will purchase Zegna shares at the close, in variable quantities and proportional to the maximum commitment of each investor depending on the level of the redemptions”, explains the press release. As reported, the extraordinary general meeting of IIAC has been set for December 15th to approve the business combination. Its closing, the Zegna listing and the first day of trading on the New York Stock Exchange with the symbol “ZGN” are expected by the end of the year, after the shareholders’ meeting.
It landing at Nyse, which was originally supposed to materialize by the end of November through the merger by incorporation of Ermenegildo Zegna from Investindustrial Acquisition Corporation, is delayed by about a month but with a greater endowment of resources. The operation, worth a total of 3.2 billion dollars (2.83 billion euros), in fact included new financial endowments for 880 million dollars (768.69 million euros), leaving the Zegna family control with 62%, flanked by Investindustrial at 11%. Of the planned new resources, 403 million dollars (356.6 million euros) come from the SPAC founded by Andrea Bonomi and chaired by the former UBS number one Sergio Ermotti. Another 225 million (199.1 million) were made available directly by the Investindustrial fund and another 250 million dollars (221.22 million euros) were raised with a Pipe (Private investment in public equity) between institutional investors and luxury industrialists, including the CEO of Prada Patrizio Bertelli.
The IPO should allow Zegna to further expand globally and continue building its manufacturing pipeline through acquisitions. The Zegna family will continue to control the company with a stake of approximately 62 percent. Investindustrial will have an 11% stake and 27% will be floating. Based on the transaction value, the merged entity will have an initial projected enterprise value of $ 3.2 billion.
Ahead of the listing, the menswear group has kicked off a major rebranding project which will lead the brand to be known simply as Zegna. Last week, when asked what he expected from the IPO, CEO Gildo Zegna said the family business is “a true industrial reality, with factories and an integrated supply chain. Our goal is to continue to strengthen our industrial roots and at the same time stay focused on building our brand equity ”.