Dive Brief:
- Chanel is now a partial owner of Cariaggi Lanifico SpA, one of its cashmere and natural fibers suppliers, following a deal with the Cariaggi and Italian luxury house Brunello Cucinelli SpA, the companies announced Tuesday.
- Brunello Cucinelli, which last year initially bought a 43% stake in Cariaggi, now retains a 24.5% stake after selling the remaining 18.5% to Chanel. The Cariaggi family sold an additional 6% to Chanel, so both Chanel and Cucinelli have a 24.5% stake in the company.
- The deal strengthens supply chain value for both Chanel and Cucinelli, particularly in the Italian market.
Dive Insight:
By taking a stake in Cariaggi, Chanel gains more control over some of its own supply chain, helping alleviate sourcing issues exacerbated by the pandemic.
Under the long-term agreement signed by the three entities, the Cariaggi family maintains a majority of shares of the company at 51%, according to a joint news release sent to Fashion Dive.
The agreement also states that Cariaggi will set corporate governance for the entity as long as the Cariaggi family maintains control and management.
Cucinelli’s initial purchase of the 43% stake in 2022 cost $16.21 million (15.05 million euros). Financial details of the sale to Chanel were not disclosed.
Chanel has previously invested in some of its suppliers. In 2012, it bought Barrie Knitwear, a Scotland-based cashmere manufacturer; and in 2021, the Business of Fashion reported that Chanel bought a majority stake in knitwear manufacturer Paima, among other similar deals. The Cariaggi deal is unique for the French luxury fashion house, however, because in these previous deals it hadn’t partnered with a fashion company as well.
These types of investments also help as Chanel and other fashion houses boost sustainability efforts. Having ownership in a supplier allows them to have more control over how and where materials are sourced and made. Recently, the European Union Council backed a regulation that would set more parameters on fashion companies’ sustainability, which would establish rules regarding transparency so businesses and consumers know more about the lifecycle of a product.
Brunello Cucinelli, executive chairman and creative director of the house with the same name, said in the release that the transaction enhances the value of the Italian supply chain.
“[I am] enormously pleased by the fact that a Maison of absolute excellence in global fashion like Chanel has chosen to invest in Made in Italy by sharing with us the beautiful Cariaggi wool mill project,” Cucinelli said in the release.
Piergiorgio Cariaggi, president and CEO of Cariaggi, said its partnerships with both Chanel and Cucinelli are a step up for the company.
“We are honored to be partnering with Chanel and Brunello Cucinelli to strengthen an industrial plan focused on innovation and sustainability, including the construction of new facilities and the use of sophisticated technologies to ensure ever higher quality cashmere, innovation, and service to our valued customers, without disregarding our profound respect for our territory, environment, sustainability,” Cariaggi said in the release.
Cariaggi is based in Cagli, Italy, and has been operating for more than 60 years. The company makes cashmere, yarn, wool, silk and linen.
