Della Valle family fails to reach 90% threshold for Tod’s takeover

It all started at the beginning of August 2022, when the Della Valle family, founder of Tod’s, decided to buy back  a 25.5% stake from minority shareholders, for a total of 338 million euros, with the aim of owning 90% of its shares and taking it off the stock market. A deal that would have repositioned the brand at the top end of the luxury market and relaunched Tod's by managing its various brands (Tod's, Fay, Hogan and Roger Vivier) separately, to focus on the most profitable ones, namely Tod's and Roger Vivier. This move would also have valued the company at 1.3 billion euros. The 10% stake held by the LVMH group would have remained unchanged.

However, last week, a Borsa Italiana filing showed that the founding family failed to reach the 90% ownership threshold needed to proceed with a proposed delisting. According to Reuters information, the family who owned 64.5% of the luxury shoemaker needed to gain the acceptance of 5’144’373 shares in order for the deal to go through. But on the last day of the offer, investors tendered Tod's shares accounting for a total of 4’134’358, thus not enabling the family to takeover. Consequently, the offered shares would be returned to their owners, according to a statement made by the Della Valle family.

Following this failed attempt, Tod’s shares fell by 21% to return to its pre-launch level at the beginning of August at 31 euros. The chairman and founder Diego Della Valle and his brother Andrea had initially offered to buy Tod’shares at 40 euros a share, through the vehicle DeVa Finance, further stating that they could delist Tod’s by merging it into DeVa Finance within six months of the closing of the takeover.

This option is however seen as less market friendly, as it could result in shareholders who did not tender their shares and are against holding shares in a no-longer-listed company, to exercise their right of withdrawal at a price below that offered in the buyout. Indeed, brokers state these legal actions may delay the whole process.

Even though the family did not specify in their latest statement whether merging Tod’s into DeVa Finance was still their intention, they announced that the final goal has not changed. “From tomorrow we will all work to achieve in the necessary timeframe the realisation of a project that we hope will be very successful,” the family stated. Today Tod's shares remain at a low level, at around 31 euros.