Italian men’s luxury group Ermenegildo Zegna has agreed to buy 85 per cent of US luxury label Thom Browne from Sandbridge Capital for an enterprise value of about $500m, the Milan-based company said in a statement.

The deal comes as social media and millennial consumers are rewriting luxury business strategy and what is fashionable.

By acquiring Thom Browne, family-owned Zegna, a €1.2bn business built on traditional menswear, brings into its fold a US luxury label credited with updating the men’s suit for a younger generation.

The acquisition is also the latest example of a trendsetting independent fashion brand being bought by a larger luxury group. Antwerp-based Dries Van Noten was bought by Puig and Italy’s Missoni sold a 41 per cent stake to Italian state-backed, private equity company F2i this year.

In a statement, Gildo Zegna, chief executive of Ermenegildo Zegna, said Thom Browne fitted with the Italian group’s ethos of “excellence, and impeccable, modern tailoring”.

He added: “On this strong footing and thanks to a thriving women’s business and strong appeal with millennials, we believe that we can build long-term value for all of our stakeholders.”

Mr Zegna, who last year introduced wash and go merino wool suits to attract a younger consumer, said he was also excited about acquiring a US brand and expanding the world’s largest market for luxury goods.

Thom Browne, the 53-year old American designer, launched a new silhouette in menswear in 2001 making trousers and jackets slim and shrunken, while remaining smart. He later introduced womenswear.

The designer who has spoken of his ambition to grow the brand internationally said in a statement the deal gave Thom Browne a partner that “brings the knowledge and skills of a global leader”.

Zegna is one of the largest independently owned luxury groups. Its revenues rose 4.5 per cent at constant exchange rates to €1.2bn in 2017. It posted a net profit of €32.8m, up 64 per cent year on year.

The companies declined to provide any further figures about Thom Browne’s financial performance, but in a Financial Times article last year annual revenues were put at “around $100m”.

Mr Browne will remain the only other shareholder besides the Zegna family, and will continue as chief creative officer. Rodrigo Bazan, chief executive officer of Thom Browne who previously worked at Alexander Wang, will also remain in his role.

Ken Suslow, founding managing partner of Sandbridge Capital, said he believed Zegna was the “ideal partner for the Thom Browne brand”.

“It is for this reason that we did not engage with other interested parties, and that instead, Gildo, Thom and I agreed upon this deal in a privately negotiated manner.”

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