Dubai retailer to take over debt-hit Ferre fashion house

Dubai's Paris Group set to buy distressed Italian fashion house, initial deal valued at $34.13m
GIANFRANCO FERRE: One of Milans top designer names became one of the casualties of the financial crisis which sapped demand for luxury goods (Getty Images)
GIANFRANCO FERRE: One of Milans top designer names became one of the casualties of the financial crisis which sapped demand for luxury goods (Getty Images)
Reuters
s
Tue 08 Feb 2011 09:02 PM

Dubai-based high-end clothing retailer Paris Group is set to buy distressed Italian fashion house Gianfranco Ferre, a source with knowledge of the situation said on Tuesday.

Founded in 1978 by late Italian designer Gianfranco Ferre, the debt-laden maison, one of Milan's top designer names, became one of the casualties of the financial crisis in 2009 which sapped demand for luxury goods.

Known for its "architectural" style and overstated elegance, Ferre has been put on sale by special commissioners after being admitted to bankruptcy protection in 2009.

On Monday, the commissioners approved an improved offer from Paris Group, a leading distributor in the Middle East of high-end brands such as Versace, Cerruti and Hugo Boss.

Paris Group plans to invest an initial $34.13m to pay down debts and open 50 top line Ferre stores worldwide, the source said. It also agreed to raise its initial offer and keep a higher number of jobs.

US private equity fund Prodos Capital Management missed a deadline in December to buy the fashion house after failing to fulfill a commercial condition.

Parent company IT Holding, which is also under extraordinary administration, was not available to comment.

Ferre is one of the few big Italian fashion names to fall into foreign hands in a mainly family-run industry.

Past cases include French group PPR's Gucci and Italian fashion brand Valentino, which is controlled by private equity group Permira.

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