Sunday, September 12, 2010

The Choo is on the other foot...

Jimmy Choo: The world's most valuable shoemaker

Jimmy Choo's owners stand to make hundreds of millions from the latest sale of the company. James Thompson reports
Saturday, 11 September 2010

The sound of Carrie Bradshaw shrieking over a new pair of Jimmy Choos in the hit series Sex and the City may have long since faded from mainstream TV screens, but the shoe company appears to be going from strength to strength.
TowerBrook Capital Partners, the private equity firm that currently owns it, yesterday said it had appointed the investment banks Morgan Stanley and Goldman Sachs to consider "long-term strategic" options for Jimmy Choo, the maker of luxury shoes for stars including the singer Beyoncé, who has sung about "kicking it in my Jimmys".
By hiring the banks, TowerBrook has effectively put Jimmy Choo, which has 110 branded stores around the world, up for sale with a price tag of about £500m, but it will also consider an initial public offering.
Either outcome would represent a meteoric rise for the luxury brand, which was founded by Tamara Mellon, the former It-girl, in 1996, after she received a £150,000 loan from her father, Tommy Yeardye (he had himself co-founded the hair products specialist Vidal Sassoon). A sale by TowerBrook, whose purchase of a majority stake in Jimmy Choo from London-based Lion Capital in 2007 implied a value of £185m, would be the fourth such deal inside a decade.
Ms Mellon, who remains the brand's chief creative officer and is understood to retain a 17 per cent stake, could not have envisaged such as journey when she first met Jimmy Choo, a Malaysian cobbler, in Hackney, east London, and formed a partnership when working as accessories editor at Vogue magazine in the 1990s. Mr Choo sold his 50 per cent stake in the company for £10m in 2001 but he has continued to deliver exclusive ranges for the brand. While Jimmy Choo has continued to sell boots to women for as much as £1,800, it has also extended its product offer into bags, small leather goods, scarves and trainers.
But the real growth story of Jimmy Choo over the past 14 years has been the riding of a tidal wave of celebrity endorsements, as well as those gushing recommendations in Sex and the City. The series ran on the US channel HBO from 1998 to 2004, but since then two films have emerged and it is still being shown on UK cable channels. Maureen Hinton, the lead analyst at the retail consultancy Verdict, said: "It is a very good brand name that has global appeal – it is perhaps a residue from Sex and the City."

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