Moncler - EGM 25 March 2021
In item 1, the EGM is called to approve a share capital increase reserved to the shareholders of Sportswear Company, a luxury fashion company acquired by Moncler for a total consideration of €1.15 billion. Pursuant to the acquisition agreement, the consideration will be paid in cash, but the shareholders of Sportswear (members of the Rivetti family and the Singaporean holding company Temasek) committed themselves to reinvest in Moncler 50% of the consideration, through the subscription of the share capital increase. The amount of the share capital increase is reasonable (5.9% of existing share capital) and we have not identified specific concerns over the definition of the share issue price. Therefore, we recommend shareholders to vote FOR.
In item 2, the Board proposes several amendments to the Company's Bylaws:
- To reduce the majority required to approve certain extraordinary resolutions (from 70% to 67%, which is the minimum legal requirement).
- To define a minimum (9) and maximum (15) number of Directors in place of the current fixed number of 9 or 11 Directors.
- To increase the minimum number of independent Directors, from current 3 to the majority of Board members.
We regret that the Board proposes to reduce the majority required to approve important resolutions potentially affecting shareholders' rights. However, such reduction is not significant and the proposed quorum is in line with that applied by almost all other Italian listed companies. Furthermore, the proposed change in the Board size will allow greater flexibility in defining the composition of the Board, and the introduction of a mandatory majority representation of independent Directors is in line with best practices and goes beyond the recommendations of the Italian Corporate Governance Code (at least 50% of independent Directors). Therefore, we recommend shareholders to vote FOR.
Moncler is a jacket and sportswear production group based in Italy. Co. directly produces and distributes its own clothing and accessories collections, through its direct boutiques and exclusive department and multibrand stores. Co. branded products range from the high fashion segment with the Gamme Rouge and Gamme Bleu collections (exclusive products and selected distribution to boutiques) to the Grenoble collection (sporting and technical garments). As of Dec 31 2013, Co. operated a network of 135 stores, including 107 directly operated stores (DOS) and 28 wholesale stores (27 shop-in-shop and 1 franchise store).
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