Valentino Deal Fails To Lift Kering Shares as Gucci Woes Mount

July 31, 2023

Kering’s acquisition of a 30% stake in Valentino for $1.9 billion failed to boost its shares, as the move is seen as a long-term play that won’t immediately alleviate the company’s reliance on its weakening top brand, Gucci. Gucci, which contributes half of Kering’s sales and nearly two-thirds of its operating profit, has struggled to keep pace with rivals LVMH and Hermes in the post-pandemic rebound. The purchase of a stake in Valentino, while profitable with potential for improvement, is not significant enough to reduce Kering’s dependence on Gucci in the short term.

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