Media is abuzz with reports of a rift between Genesis Luxury and LVMH’s private equity firm L Capital Asia. Reportedly, a week ago Genesis Luxury had denied the reports of a rift, but the winds are blowing the other way. The falling out between the two parties will result in the LVMH owned beauty product retailer Sephora seeking a new franchise partner. Reportedly, inside sources have indicated that talks are already on between Sephora and DLF Brands. The first Sephora store was opened in Delhi’s Select Citywalk Mall last year by Genesis Luxury.
While the reasons for the fallout are under speculation, L Capital Asia, which is a major investor in Genesis Luxury, had asked the founders of Genesis Luxury to either buy out its 40% stake or sell the luxury brands marketing firm. Further, Genesis Luxury was allegedly asked by L Capital Asia to hire one of the Big Four firms to audit its accounts. The latter also has complained about non-compliance of its suggestions by Genesis Luxury.
Genesis Colors is the parent body of Genesis Luxury and owns 60% of its shares. The company has three major PE investors, Sequoia Capital, Henderson and Mayfield. The company has reported a 35% annual growth rate despite economic downturn. Unverified claims state that plans are afoot to launch an IPO within 2-3 years.
In July this year, Genesis Luxury launched two new brands in the country, Michael Kors at DLF Emporio, New Delhi and Villeroy & Boch at the Palladium, Mumbai.