Translated by
Nicola Mira
Mar 31, 2017
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Naf Naf now profitable and keen to expand internationally, as talks for its sale are ongoing

Translated by
Nicola Mira
Mar 31, 2017

French fashion group Vivarte is about to sell Naf Naf, whose CEO Luc Mory has talked to FashionNetwork about the sale's progress, about the fashion retailer's rather fine financial form and about how it plans to meet future challenges. The full interview is available exclusively on FashionNetwork Premium

Luc Mory - DR

FashionNetwork: It is hard to talk about Naf Naf today without mentioning the Vivarte group, and the fact the fashion retailer is up for sale. As Naf Naf's CEO, what can you tell us about the situation?

Luc Mory: The group has recently negotiated a deal, a very good one I think, which brings its indebtedness level with its performance. The fact that the Vivarte group's EBITDA has always been positive is one that is seldom mentioned. Besides reducing the debt, the deal pushed back its term by two years, to 2021. This gives the group an entirely new perspective. However, since its was announced last January that the brand is up for sale, Naf Naf will not have the opportunity of living through this new phase for the Vivarte group.

FNW: What stage has the selling process reached now?

LM: It began recently, and it is expected to last through most of 2017. We are holding initial negotiations, and for us the challenge is to find a buyer willing to finance Naf Naf’s growth, now that we have put the brand back on the right track. The buyer could be French, but there is a lot of interest from Asia too, this is all I can say for the time being.
FNW: What shape is Naf Naf currently in ?

LM: It is an attractive SME with an international outlook, as 30% of its revenue comes from abroad. There is potential both in France and across the border. Initially it will probably be best to concentrate on Europe, but China and South America are promising markets for the longer term. We already have a foothold in South America, thanks to a partner in Colombia which has opened nearly 80 Naf Naf stores. You can feel a real interest in Latin countries for a brand with such a feminine style. In Spain too, our largest foreign subsidiary, with a double-digit growth and 90 retail outlets (15 franchised stores, three directly owned ones and 70 retail corners). Holding our own in Inditex country is not so bad.
FNW: It is clearly the right time to make the brand’s voice heard, given the impending sale.

LM: Of course. Now is the time to make a statement. But the decision to sell was not a random one. It stemmed from the fact that we completed a turnaround, and our results are positive! The message we want to broadcast is that we are keen to grow, and we are ready for it. Let me make it clear that Vivarte's CEO Patrick Puy did not ask me to embellish reality. I was simply tasked with reaching the objectives I set myself.
FNW: Do you think you will be able to avoid job-saving measures as part of the sale?

LM: Yes, I do. Totally so. There is only one service company we share with Chevignon which we will need to eliminate, but it will be easy, since 85% of its business is dedicated to Naf Naf. I would like to mention that in the last few years, even in the midst of reshuffles, Naf Naf has never had to resort to job-saving measures. Simply put, if I was an investor, I would be interested in Naf Naf. Our price tag is reasonable, I cannot say what it is, but it is actually very reasonable, considering we are a profitable company, and that our EBITDA has improved dramatically. I don't want to appear too optimistic, but there is no reason why this sale should prove difficult.  

The rest of the interview, specifically about Naf Naf's turnaround strategy and its expansion projects, is published on Fashion Network Premium.

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