Cavalli to sell stake to private equity fund

Roberto Cavalli SpA is ready to sell a stake to a private equity fund in a move to finance its development, mainly abroad.

Cavalli said advisors Merrill Lynch (NYSE:MER) (OOTC:MERIZ) and law firm Erede will launch a competitive auction in the coming days and choose a financial partner.

In 2007, Roberto Cavalli reported sales of 238 millions euros with margins of 39 pct on sales and has a positive net financial position, it said.

Potential buyers for the stake include US and UK funds Permira, Cinven, Carlyle and perhaps also Blackstone, which would also be ready to acquire a majority stake.

Cavalli was quoted as saying he would not accept offers that value the company below 1.4 billion Euros.