What: Puig, the parent company of luxury brands like Paco Rabanne and Jean Paul Gaultier, has launched its IPO on the Madrid stock market.

Why it is important: This IPO is crucial as it reflects the growth potential within the luxury sector and highlights the strategic moves by traditional family-owned businesses to strengthen their competitive edge globally.

On Friday, the Spanish luxury group Puig, parent to renowned brands such as Nina Ricci, Paco Rabanne, and Jean Paul Gaultier, marked its entry into the financial markets with an IPO in Madrid. This move, coming 110 years after its founding in Barcelona, is aimed at giving Puig the financial leverage to compete with major sector players like Estée Lauder, Hermès, Kering, and LVMH.

Priced at 24.50 euros per share, the IPO values Puig at nearly 14 billion euros, integrating it directly into the Ibex 35, Spain's flagship index. The IPO comprises a new share issue expected to raise 1.25 billion euros and a sale of existing shares by the Puig family holding, Exea, generating an additional 1.36 billion euros.

Despite the sale, the Puig family will retain majority control with 71.7% of shares and 92.5% of voting rights. This strategic financial maneuver is designed to inject "financial muscle" into Puig, allowing it to capitalize on favorable market conditions and continue its trajectory of strong growth and revenue diversification, notably achieving significant success in essential markets like China. Last year alone, Puig reported a turnover of 4.3 billion euros and a net profit increase of 16% to 465 million euros.

Puig, parent company of Paco Rabanne and Jean Paul Gaultier, launches on the stock market