A string of fashion disasters sent private equity groups into retreat. Now, some buyout groups have dusted down their cheque books and are back chasing luxury brands.

This month, Beverly Hills-based private equity investor Regent bought the German luxury fashion house Escada from Megha Mittal, the daughter-in-law of Indian steel tycoon Laskshmi Mittal. Just weeks earlier, Mandarin Capital Partners, a China-based buyout firm, snapped up a 70% stake in Italian bags and leather specialist Eurmoda Group. Both companies changed hands for undisclosed sums.