Material World

One love affair ends and another begins: after three (count ‘em) relationships with private equity firms, Tamara Mellon, chief creative officer and founder of Jimmy Choo has hooked up with a long-term partner in the form of Labelux. Or at least that’s how she sees it.

“It feels like we have finally come home,” she said, when I called her hours after the commitment ceremony that was the private group’s acquisition of the luxury accessory brand. “They are in this for the long-term,” she continued happily. “Ten years is a short horizon for them.”
According to Ms Mellon, this is a huge relief after the upheaval that was her brand’s various private equity pairings, each of which lasted the usual three to five years.

“Look,” she said. “Private equity is about financial engineering, and that model is very difficult to apply to fashion and luxury, when it can take 30 years to really build a brand.” She sighed. “It’s very stressful on a company to keep going through” the break-ups and new make-ups that are involved with continual changes of ownership.

Hence, she said, she had pushed former owner Towerbrook to let Choo marry itself to a private group instead of selling to another private equity firm or going public, the two alternative proposals on the table. When the deal was made, she said, her heart skipped a beat.
“A private owner like Labelux is about brand building,” she noted. They have never gone through a corporate divorce and “sold a company” and even better: “we really want the same things,” she noted.

Which are?

“We think with patience and strategic care, this can be a multi-billion dollar lifestyle company,” she said. Next up – though there is no specific timeline for its birth – will be ready-to-wear, followed by housewares, watches, swim and children’s wear.

As for the mutual seduction that occurred between luxury and private equity during the noughties, culminating in Permira’s record-setting purchase of Valentino, Ms Mellon thinks it’s over. “I expect any activity will be more with existing luxury groups or private owners or going public,” she says. Really?

“I do.”