For over a decade, Caravel has supplied Gucci with precious leathers, such as crocodile, used in the manufacture of leather goods, shoes, clothing and watch bands. The company has developed very rapidly thanks to its consistently high quality products, and currently supplies a growing number of prestigious luxury brands. In the year 2000, Gucci Group brands represented approximately 20% of Caravel’s total revenues with the balance coming from other labels.
This acquisition is part of Gucci’s strategy of enhancing operational control over its supply chain and will provide increased flexibility and quality control across the entire product range.
Together with Caravel, Gucci plans to build a new state-of-the art tannery that, once completed, is expected to be the biggest precious skins tannery in the world, ensuring continued supplies of strategic components for Gucci Group brands leather goods production.
In fiscal year 2000 leather goods revenues for the group were approximately $680 million, or 30% of the Group’s total revenues.
Details of the financial terms of the acquisition are not disclosed. However, Gucci Group notes that the impact on its financial condition and near-term earnings per share is not expected to be material.
