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Spanish equity fund eyes luxury

Iame Capital Riesgo, the Spanish private equity firm, has set up a new 500 million (£396.7m) fund to help it build a luxury goods group.

The firm’s investment vehicle, called Brand Capital Made in Spain (BCS), plans to replicate the structure of key luxury goods groups LVMH and PPR with Spanish fashion, jewellery, leather and retail brands.

BCS said it planned to integrate 24 fashion brands with mid- to top-end positioning.

It said this would enable the company to generate cost savings as well as boost its bargaining power with distributors of the labels.

The group would also consider expanding the resulting portfolio of labels into Latin America and the US as well as other international markets.

BCS said it had already assessed more than 180 companies and that it had identified 50 brands with potential to integrate into the new group.

It added that negotiations had begun with some of those brands and that it expected to complete its first acquisitions this year.

BCS is understood to have already begun the due diligence process on 15 deals. Iame Capital Riesgo revealed that its target was to achieve sales of 600 million (£476m) from BCS in 2009.

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