1. Antichi Pellettieri SpA
Advanced Corporate Finance
November 17, 2017
Antichi Pellettieri SpA
Case Study
Francesco Baldi

2. Antichi Pellettieri SpA: 2 Business Units
AP is one of the main players in the accessible luxury segment within the luxury market
The company is organized into 2 main business units:
the leather handbags, accessories and footwear division (89.2% of revenues generated in 2005);
the apparel division (10.8% of revenues generated in 2005)

3. Antichi Pellettieri SpA: Geographic Markets
Increasing presence in the fast growing markets:

4. Antichi Pellettieri SpA: Corporate Strategies
The key drivers of the 3-year corporate strategy are the following:

5. Antichi Pellettieri SpA: Business Plan (2006-2008)
Profit and Loss Statement (2005 ProForma-2008E) is the following:

6. Antichi Pellettieri SpA: Valuation (May 2006)
2 valuation methods are used:
Relative multiples analysis – comparable companies operating in the luxury segment with a focus on leather goods and footwear;
DCF analysis – control method
AP has not a pure competitor as it operates in the “accessible luxury” market segment. Comparable companies are selected on the basis of the business model (product categories) and profitability/growth profile
Mean EBITDA CAGR = 16.5%

7. Antichi Pellettieri SpA: Valuation (May 2006)
Over the 3-year business plan, AP growth rate is estimated to be higher than the average growth of comparables ( EBITDA CAGR 21% vs. 15%)
Geox sets the top end of the range of multiples given its higher growth profile (>30%)

8. Antichi Pellettieri SpA: Valuation (May 2006)
Among others EV/EBITDA multiples as of 2006E for Burberry, Coach and Tod’s are calculated:

9. Antichi Pellettieri SpA: Valuation (May 2006)
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10. Antichi Pellettieri SpA: Valuation Range (May 2006)
Equity Value: €
€ 7.50 per share
DCF next...

11. Antichi Pellettieri SpA: DCF Analysis
DCF analysis used as a control method
ASSUMPTIONS:

12. Antichi Pellettieri SpA: DCF Analysis (2)
β = 1.3 for AP

13. EV ranges from € 307 million to € 401 million
Antichi Pellettieri SpA: DCF Analysis (3)
WACC-growth rate sensitivity analysis:
EV ranges from € 307 million to € 401 million

14. Antichi Pellettieri SpA: Final Listing Price
Listing: Milan Stock Exchange – Expandi Segment
# of Shares Offered: shares (33% of post-IPO share capital)
Mariella Burani FG ownership of AP will decrease from 88% to 53%
Offer Price Range: € 7.15 – € 8.50
FINAL LISTING PRICE (on June 7, 2006) = € 7.77 per share
EQUITY VALUE = € 350 million
Equity Capital Raised: €