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The Puffy Coat Billionaire's IPO Soars

1014_remo-ruffini_416x416Remo Ruffini has transformed a sleepy Italian clothing company into a global luxury apparel powerhouse known for selling puffy $1,000 down jackets and on Monday investors sought to get a piece of another expensive Moncler offering, bidding up the shares of the company by more than 40% from their IPO price.

Shares of Moncler, which started trading on Monday on the Milan Stock Exchange, surged to 14.38 euros in their first day of trading. Ruffini, chairman and creative director of Moncler, took over the company in 2003 and did not sell a share in the initial public offering. His 32% stake in Moncler is now valued at about $1.6 billion.  It’s one of Italy’s biggest IPOs in years.

Moncler was once a small Italian company with French origins that catered to a niche market by making jackets for mountain climbers and downhill ski racers.  But Ruffini has tapped into the global luxury market, particularly in Asia, where Moncler generates a serious amount of its sales and opened big stores in countries like China.

The other big winners are Ruffini’s private equity backers, Eurazeo and the Carlyle Group. Those private equity investors raised more than $1 billion by selling shares in the IPO. Carlyle initially invested in Moncler in 2008, buying a 48% stake for some $200 million. Carlyle sold part of its Moncler shares in 2011 to Eurazeo for about $500 million. Eurazeo, a Paris-based investment firm, has made more than $1 billion from its Moncler investment in just over two years.

The luxury fashion segment has produced some successful entrepreneurial stories in recent years and been well received by investors . Michael Kors, for example, guided his Michael Kors Holdings KORS -0.47% through a successful IPO in late 2011 and shares of the luxury retailer have increased by 240% since then. Private equity firm Bain Capital this month announced it was buying a big stake in Canada Goose, which like Moncler sells luxury winter apparel. But the Italians rule over this world and Ruffini is joining seven other Italian billionaires as the richest people in the fashion business.