Chris Burch, the former husband of fashion designer Tory Burch, sold about half of his 28.3 percent stake in New York-based retailer Tory Burch LLC Dec. 31, settling a year-old legal dispute between the couple, according to two people familiar with the transaction.

The sale values the closely held operation at about $3.3 billion, according to New York-based research firm PrivCo Media LLC, and makes Tory Burch, 46, a billionaire. The two people said Chris Burch, 59, will retain about a 15 percent stake in the New York-based operation, which sells high-end women’s clothing and accessories, including popular ballet flats adorned with the company’s double-T logo.

The sale comes amid a bull market for fashion companies, including Italy’s Prada SpA, whose shares more than doubled in 2012. New York-based Michael Kors Holdings Ltd. shares were up 87.3 percent during the year, and Germany’s Hugo Boss AG rose 44.5 percent.

“The performance of IPOs from Prada and Michael Kors are a setup for an offering from Tory Burch this year,” said Sam Hamadeh, CEO of PrivCo, in a telephone interview. “Right now, hers is mostly a U.S. brand. The upper class, preppy American look she sells -- and lives -- puts her in a good position to do very well overseas.”

Handbags, Shoes

Tory Burch LLC sells handbags, shoes, dresses and eyeglasses through more than 80 Tory Burch retail stores and other outlets, such as Neiman Marcus, Nordstrom and Bloomingdale’s. In fiscal year 2012, the company generated more than $760 million in revenue and about $230 million in earnings before interests, taxes, depreciation and amortization, PrivCo said.

Based on the average enterprise value-to-sales and enterprise value-to-Ebitda multiples of five publicly traded peers -- Prada, Boss, Michael Kors, Ralph Lauren Corp. and Hermes International -- the company could be worth more than $3.4 billion, according to data compiled by Bloomberg. Enterprise value is defined as market capitalization plus total debt minus cash.

Chris Burch sold the stake, which he held through investment company JCB Investments LLC, to General Atlantic LLC, a Greenwich, Connecticut-based private equity firm, and BDT Capital Partners LLC, the Chicago-based investment company run by Byron Trott, a former Goldman Sachs Group Inc. vice chairman. Because the deal was completed in 2012, it will save Burch millions of dollars in capital gains taxes, which were raised by Congress to 20 percent from 15 percent on Jan 1.

Tory Burch, whose mother dated Marlon Brando and father once courted Grace Kelly, owns 28.3 percent of the company. Her stake is worth about $935 million, based on the transaction. Her net worth exceeds $1 billion after accounting for more than $70 million she received from equity sales and dividends in the past decade, according to PrivCo.

Blavatnik Investment

“We are thrilled to have BDT Capital Partners and General Atlantic join us as partners,” Tory Burch, the company’s CEO, said in a statement Jan. 1. “They are completely aligned with our long-term approach to building our brand and share our vision for growth globally.”

Annie Ehrmann, a spokeswoman for Chris Burch at H+K Strategies, said he declined to comment on the sale. Frances Pennington, a spokeswoman for Tory Burch LLC, said Tory Burch declined to elaborate on her statement. Jennifer Dunne, a spokeswoman for BDT, and Patricia Hedley, a spokeswoman for General Atlantic, both said the firms had no comment on the transaction.

The Burches, who opened the first Tory Burch retail store in New York in February 2004 and divorced in 2006, have sold at least two stakes in the company in the past eight years. Access Industries, the investment vehicle owned by Russian-born U.S. billionaire Len Blavatnik, became the company’s first and largest outside investor in 2004, when it bought about 20 percent of the retailer.

Ballet Flats

Today, Access controls about 10 percent of the company, having sold about half of its original holding. Part of that stake was sold in a 2009 investment round that PrivCo said generated $200 million. In that deal, Mexico City-Based private equity firm Tresalia Capital SA acquired an estimated 18 percent stake in Tory Burch.

A representative for Tresalia could not be reached for comment. Stan Neve, a spokesman for Access, declined to comment.

Chris Burch founded his own fashion firm, C. Wonder, in 2011, selling women’s apparel and accessories at lower prices than Tory Burch. The product line -- which includes ballet flats that sell for less than half the price of a similar pair of Tory Burch shoes -- was criticized in a December 2012 Vanity Fair magazine article as a “down-market version” of Burch’s “signature uptown-downtown boho blend.”

Tory Burch was born and raised in Valley Forge, Pennsylvania, a suburb outside of Philadelphia. Her father was an investor, having inherited and sold a paper-cup company and a seat on the New York Stock Exchange. A self-described tomboy, her interest in fashion wasn’t sparked until she bought a prom dress during her senior year in high school.