After Leo France, Chanel Buys Out Its Italian Partner Grey Mer

The excellence of Italian craftsmanship is increasingly attracting major luxury brands, which seek to integrate small businesses directly into their production chain, in order to better control the process and ensure the stability of their supplies.

Romagna, in Italy (located to the west of Bologna, between Ravenna and Ferrara), is a nerve centre for the production of leather goods and shoes, forming a western counterpart to the manufacturing hub of Prato, in Tuscany. In this region, Chanel relies on several companies to supply its luxury goods.

One of these manufacturers, Grey Mer in San Mauro Pascoli, in the Rubicone district and specialising in luxury shoes, has just been bought by the company from rue Cambon. This Wednesday, Chanel confirmed to the press the acquisition of a majority stake in the company, stating that ‘the two companies have been collaborating for 13 years and produce shoes for the collections created by Studio Chanel. Faced with the need to guarantee its production capacity, Chanel naturally wished to invest more actively alongside this trusted partner to write a new page in its history.

Founded 45 years ago by Italian entrepreneur Luciano Alessandri, Grey Mer will remain partly in the hands of his family. According to the Italian media Milano Finanza, the family will retain a 30% stake, while the French giant will acquire 70%. The amount of the transaction has not been disclosed.
The group had already bought Roveda, near Milan, in 2000, then Gensi Group, a craft company based in Teramo, in 2015. Five years later, the company acquired Ballin in the Venice region. More recently, Chanel took a 20% stake in Leo France, a Tuscan manufacturer specialising in metal accessories for leather goods.

For several years, the vertical integration of its branches has been one of Chanel's strategic challenges, a trend that has become even more pronounced in recent financial years. Control of leather supplies is becoming a crucial issue for luxury brands. On the one hand, the luxury market's growth is primarily based on sales of accessories, leather goods and shoes. In addition, the leading players in the sector (Louis Vuitton, Hermès, Chanel) are adopting an upmarket strategy by developing increasingly extensive collections. This dynamic is leading to fiercer competition for the supply of quality skins and reinforces the need to secure artisanal businesses – particularly in Italy – which perpetuate exceptional expertise.