The Italian chain
OVS prepares IPO
Despite the global financial crisis and the recession in Italy, OVS continues to expand at an accelerated pace as it pursues bold ambitions. In recent years, the fast-fashion brand owned by the Italian Gruppo Coin has emerged as a full-fledged fashion brand, bolstering its position as the undisputed apparel retail leader on the Peninsula.
While celebrating the inauguration of its new Milan concept store dedicated exclusively to its adult collections, OVS confirmed its intention for its IPO by the end of the year.
The company enlisted advice from the firm Lazard for the deal, which will also see the retailer Upim absorbed by OVS.
The transaction’s first phase will see the separation of OVS-Upim’s business from that of Gruppo Coin, which is currently held by the British investment fund BC Partners. At least 30% of OVS will then be listed in a public offer. According to estimations, OVS could be valued at 1.5 billion euros.
The retail chain, in fact, serves as an anchor for the department store company, Gruppo Coin. It represents 70% of total revenues (953 million euros out of approximately 1.6 billion) and 95% of the group’s earnings with an EBITDA of 136 million euros. In ten years, its market share has grown from 2.5% to 4.8 %, leaving Benetton, Zara, H&M, and others far behind.
"In the childrenswear sector, our market share has reached 13%. OVS Kids is a big hit and because of that, we would like to accelerate expansion abroad. We are currently the most fashionable, modern, broadly appealing and democratic retailer on the Italian market, where we would like to attain a 7-8% share of the fashion market,” declares CEO Francesco Sama.
In 2011, the group opened an OVS store in Le Millénaire mall in Aubervilliers, on the outskirts of Paris. It was closed, however, owing to a lack of positive results. Nonetheless, it hopes to return to France with its childrenswear.
Founded in 1970 as a means to sell Coin’s department store surplus, the company, originally called Oviesse, underwent its first facelift in 2007, metamorphosing from a discount store aimed primarily at families, to a fashion retailer: "OVS Industry", offering very competitive prices.
Today, it has undergone a third revolution with its new concept store dedicated to adult collections, transforming OVS into a true fashion brand thanks to a design department that has been beefed up under the leadership of fashion coordinator Caterina Salvador, now supported by Marco Mazzoran, fashion director for menswear and childrenswear.
"It has not been easy considering how difficult the domestic market has been, but we’ve managed to stand up against major competitors like Zara and others thanks to our extensive retail network. Over the past ten years, we’ve increased the number of our stores from 200 to over 700, and for the first time in years we have recorded growth on a comparable basis. Over the past 10 months, we’re at +6%," said Stefano Beraldo, CEO of Gruppo Coin.
The focus has not only been on products, but also on the entire supply chain, becoming more efficient while reducing costs. Today, OVS has 725 stores worldwide, including 592 in Italy and 133 abroad (Spain, Eastern and Central Europe and Saudi Arabia), ranging from corners to flagships, from stores stocking all lines to stores OVS Kids, dedicated solely to childrenswear (156, including 100 in Italy, a number that should be raised to 150 by the end of the year). In 2014, 80 new openings are planned in Italy and 30-40 abroad.
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