Floating down the catwalk

Italy's top fashion designers are putting the finishing flourishes on their most important creations to date - their balance sheets - in anticipation of going public.

After years of running their couture and ready-to-wear houses like family firms, Giorgio Armani, Gianni Versace, Valentino, Cerutti 1881, and Gianfranco Ferre are considering floating.

The success of Gucci Group, whose shares have risen 323 per cent, and Rome jeweller Bulgari, whose shares are up 372 per cent in the past two years, has made it clear to designers that investors are as willing to snap up their stocks as movie stars are to don their gowns on Oscars night.

"The boom in financial assets worldwide has created a lot of wealth, and when that happens, people buy more Porsches and fancy clothes than they buy caramels," said Pio Benetti, at Ducato Gestioni in Milan.

The most widely anticipated sale is Gianni Versace's company, which said in April that it plans a stock sale in New York, and possibly Milan, by June 1998.

Versace's flashy and flamboyant creations last year raked in sales worth 845 billion lire (pounds 324m), 80 per cent of which was exported. The company expects 1997 sales to rise 20 per cent. Pre-tax profits were 175bn lire.

Investment bankers have been lining up outside Versace's elegant palazzo headquarters on Milan's Via Gesu to underwrite the offering, including Credit Suisse First Boston, BZW Securities, Morgan Stanley and Goldman Sachs. The company says it has not decided on who will lead the offering.

The King of Italian fashion, Giorgio Armani, is "considering the stock market as one option for the future", says a spokesman, though no decision has yet been taken. Armani, whose clothes are sold through more than 2,000 stores worldwide, had sales of 1.87 trillion lire last year.

Gianfranco Ferre, the designer who formerly headed up the Paris-based Christian Dior, has also spoken with bankers at Morgan Stanley about an offering. Clothes and other products made using the designer's name pulled in 1.25 trillion lire in sales last year.

One of the hottest Italian designers, Miuccia Prada, has been silent on whether she plans to sell a stake in her company. Because of the company's strong growth rates, a Prada sale would likely be the most successful of all the main Italian fashion houses.

"Investors would fight to the death to buy Prada shares," said Alberto Rolla, an analyst at Pasfin Securities. Prada, which sells leather bags, shoes and clothing under the Prada, Miu Miu and Granello brand names, expects retail sales to rise to 1.391 trillion lire this year.

Yet the path to public ownership is a long catwalk for many Italian designers - especially those that farmed out important aspects of their businesses, including retail stores, to licensees and other companies.

Last week designer Romeo Gigli said his company is in talks to be acquired. While the designer's clothes and jeans grace many a fashionable figure on the streets of Paris and New York, years of mismanagement left Gigli in poor financial shape, with only two of its own stores.

"Designers have to clean up their acts," said Bruce Belfiore, an investment banker at Gallo Advisories in Milan. "That means they have to open up to auditors and think in terms of minority shareholders - not an easy task."

Valentino Garavani and his partner Giancarlo Giammetti have been working with Goldman Sachs for the past year to revamp the company's licensing agreements, the ownership of its retail stores and to plot a succession strategy.

While Valentino and his advisers stay mum, industry observers say the company may warm more to a merger with a fellow designer rather than a public offering because of the company's poor financial situation. It does not own all of the stores selling its goods.

Speculation surfaced two months ago that Valentino might be the target of a planned merger between two clothing holding companies, Marzotto e Figli and Holding di Partecipazioni Industriali, but talks collapsed three weeks ago.

Start your day with The Independent, sign up for daily news emails
Voices
There will be a chance to bid for a rare example of the SAS Diary, collated by a former member of the regiment in the aftermath of World War II but only published – in a limited run of just 5,000 – in 2011
charity appealTime is running out to secure your favourite lot as our auction closes at 2pm tomorrow
Arts and Entertainment
James May, Jeremy Clarkson and Richard Hammond in the Top Gear Patagonia Special
tv
News
Claudia Winkleman and co-host Tess Daly at the Strictly Come Dancing final
people
Arts and Entertainment
Caroline Flack became the tenth winner of Strictly Come Dancing
tvReview: 'Absolutely phenomenal' Xtra Factor presenter wins Strictly Come Dancing final
PROMOTED VIDEO
Arts and Entertainment
The Apprentice finalists Mark Wright and Bianca Miller
tvBut who should win The Apprentice?
News
news
Extras
indybest
News
Elton John and David Furnish will marry on 21 December 2014
peopleSinger posts pictures of nuptials throughout the day
Sport
Brendan Rodgers looks on from the touchline
SPORT
Life and Style
A still from the 1939 film version of Margaret Mitchell's 'Gone with the Wind'
life
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Carlton Senior Appointments: Private Banking Manager - Intl Bank - Los Angeles

$200 - $350 per annum: Carlton Senior Appointments: Managing Producer – Office...

Carlton Senior Appointments: San Fran - Investment Advisor – Ind Advisory Firm

$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...

Sheridan Maine: Commercial Finance Manager

Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Sheridan Maine: Regulatory Reporting Accountant

Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Day In a Page

The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

The 12 ways of Christmas

We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
Birdwatching men have a lot in common with their feathered friends, new study shows

The male exhibits strange behaviour

A new study shows that birdwatching men have a lot in common with their feathered friends...
Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

Famous diaries: Christmas week in history

Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
From noble to narky, the fall of the open letter

From noble to narky, the fall of the open letter

The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

A Christmas ghost story by Alison Moore

The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'
Marian Keyes: The author on her pre-approved Christmas, true love's parking implications and living in the moment

Marian Keyes

The author on her pre-approved Christmas, true love's parking implications and living in the moment
Bill Granger recipes: Our chef creates an Italian-inspired fish feast for Christmas Eve

Bill Granger's Christmas Eve fish feast

Bill's Italian friends introduced him to the Roman Catholic custom of a lavish fish supper on Christmas Eve. Here, he gives the tradition his own spin…
Liverpool vs Arsenal: Brendan Rodgers is fighting for his reputation

Rodgers fights for his reputation

Liverpool manager tries to stay on his feet despite waves of criticism
Amir Khan: 'The Taliban can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'

Amir Khan attacks the Taliban

'They can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'
Michael Calvin: Sepp Blatter is my man of the year in sport. Bring on 2015, quick

Michael Calvin's Last Word

Sepp Blatter is my man of the year in sport. Bring on 2015, quick