Italian label Ermenegildo Zegna has announced plans to go public, working with a New York-based special purpose acquisition company (SPAC) on the deal. The deal values Zegna at $3.2 billion USD, and will see the label raise $880 million USD in funding while the founding Zegna family hold a 62% share in the company.

The new funding will allow Zegna to rebound from the pandemic, after its revenues dropped by almost a quarter to $1.24 billion USD in 2020. Additionally, the label will look into the possibility of acquiring other labels, building on the strategy that saw it acquire a majority stake in Thom Browne in 2018 at a valuation of $500 million USD. Earlier this year, Zegna also partnered with Prada to take majority control of Filati Biagioli Modesto SpA, an Italian cashmere producer.

The SPAC that Zegna is merging with was created by a private equity group named Investindustrial and is chaired by Sergio Ermotti, who was previously chief executive at UBS. This deal structure allows fund managers or experts to create a shell company that can then raise investment from public markets. This shell company (the SPAC) is then merged with another company (in this instance Zegna) to take the company public.

In other business news, Burberry is “very confident” that creative director Riccardo Tisci will remain at the helm of the London-based label.