June OLLY GAN and CM-CIC Investissement. A model partnership

Transcription

1 June 2016 OLLY GAN and CM-CIC Investissement A model partnership

2 Olly Gan was created in Aix-en- Provence in 1981 and is now one of France s best-known men s ready-to-wear brands. Claude Gigou, who has been CEO since 2007, spoke to us about his development strategy in a fastmoving clothing industry. Claude Gigou

3 OLLY GAN and CM-CIC Investissement: perfectly tailored for growth. What is Olly Gan s market position? Claude Gigou: We specialise in affordable fashion in the men s ready-to-wear clothing market. In practical terms, that means that an Olly Gan suit is half the price of a suit from a luxury brand, and twice the price of a suit from a mass-market brand. In shopping centres, where 80% of our stores are located, Olly Gan is generally the premium store. The ready-to-wear sector has suffered a lot in the last 10 years. Have you been affected? C.G.: Fortunately not. Our profitability rate is currently 14%, which is at the upper end of the range in our industry. That is mainly because of the way we have developed and reorganised our branch network since We have increased store numbers from 70 to 150. We have withdrawn almost completely from the traditional franchise model, which accounted for half of our stores 10 years ago, and we now favour our own branches (three quarters of the current network) and affiliated stores. That strategic shift has enabled us to adopt an integrated management policy and optimise inventory turnover and logistics. We are aiming to have stores by 2020, covering the whole of France. As well as increasing coverage in France, what are your other growth drivers? C.G.: One of the main challenges in our sector today is covering all sales channels. That s why we are currently setting up a comprehensive «web-to-store/store-to-web» system across the company, which will also allow customers to see whether products are in stock in real time. We are also working to enhance our market position and update our image, both in stores and through external communication. After staying on the sidelines for a few years, we are now ready to reassert our presence in the media, starting in the autumn. Are acquisitions also in the pipeline? C.G.: That is one of our main sources of growth. We recently acquired Peter Polo Saint-Tropez, a company that specialises in beachwear and for which we have high hopes. It currently operates on the Mediterranean coast but we plan to expand it into towns on the Atlantic coast and elsewhere in Europe. We are also not ruling out further bolt-on acquisitions of men s ready-to-wear brands.

4 What is CM-CIC Investissement s role with respect to Olly Gan? C.G.: Since 2007, through several LBOs, the management team has increased its stake in the company to 52%. CM-CIC Investissement is our main financial partner, and has helped us achieve that by giving us the benefit of its expertise in buyout transactions. Our partnership is of strategic importance for us because, as an equity investor, CM-CIC Investissement can provide us with long-term support. For us, that longterm visibility is vital. It allows us to embark on game-changing projects in a fast-moving sector, but also to give equity stakes to the young executives who will be managing the company in future. 14% profitability rate 150 stores over 400 employees

5 OLLY GAN as seen by Laurent Sallet, CM-CIC Investissement. Laurent sallet We have known Claude Gigou for several years now, and he has clearly understood the benefits of our approach to private equity. CM-CIC Investissement worked with Claude to tailor a deal that gave the management team a majority stake in the business. Well before we bought into the company in 2014, we also put together a group of co-investors so that the Group could have a shareholder base with a common vision of the business, and could adjust its financing structure so that it would not hamper future development. Since CM-CIC Investissement acquired its stake, Olly Gan has opened another 12 stores and acquired the Peter Polo Saint-Tropez brand. As an active partner, CM-CIC Investissement increased its investment in Olly Gan as part of that deal. We have put Olly Gan s management in touch with other companies in our portfolio and network, and we have provided them with our experience in structuring deals. Olly Gan s development strategy is based on the quality of its management and expertise, and it is delivering steadily rising sales in a market that has been subdued for several years now. Olly Gan now wants to expand across all sales channels and develop the Peter Polo Saint-Tropez brand in both France and abroad. Of course, that strategy will take time to realise; as such, it ticks all our boxes as a long-term investor and fits with our desire to work with highly performing companies and people.

6 CROIRE EN VOUS, C EST CAPITAL. Exploring new territories, flying higher, travelling further... At CM-CIC Innovation, we believe in business leaders who dare to take risks. We provide long-term support and equity financing to facilitate the technology projects of over 30 high-potential companies with a range of development objectives, as part of genuine partnerships based on mutual trust. TheLINKS.fr - RCS Nantes B Mars Crédits photos : Getty Images - Olly Gan. CM-CIC Investissement - Lyon Espace Cordeliers - 2, rue Président Carnot Lyon Tél Paris - Lyon - Nantes - Lille - Strasbourg - Bordeaux - Montréal Head office 28 avenue de l Opéra PARIS