Qatari Investment Group Acquires Parisian Fashion House Balmain

On June 22, 2016, it was announced that the Parisian fashion house Balmain was acquired in whole by Mayhoola for Investments, a Doha-based investment group with ties to Qatar’s royal family. The deal is said to have valued Balmain at nearly €500 million, implying a steep valuation of ~4.1x revenues or ~14x earnings before interest, taxes, and amortization (EBITDA) based on 2015 financials. Purportedly Balmain attracted bids from several other private equity firms, including L Catterton (formerly L Capital).

The fashion house was founded by Pierre Balmain in 1945. In the period following World War II, Balmain was “a king of French fashion” and outfitted stars such Brigitte Bardot. Oscar de la Renta served as the designer of Balmain from 1993 until 2002. The fashion house saw a revival with the arrival of designer Olivier Rousteing in 2011. Rousteing, 31, collaborated with fast fashion giant H&M on a collection. Mayhoola is expected to finance growth through the opening of retail stores and the development of Balmain’s accessories line.

The Qatari investment group started to make investments in the luxury industry in 2012 with the acquisition of Italian fashion house Valentino from private equity firm Permira for about €700 million. In 2014, Mayhoola acquired a 65 percent stake in the parent company of Italian menswear brand Pal Zileri (Forall Confezioni SpA) for an estimated $145 million.

Sources: The New York Times, The Business of Fashion, Wikipedia

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