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Schottenstein Buys 50% of Shiro

Schottenstein Stores Corp. is venturing in the luxury goods market with a newly formed unit and has taken a 50 percent stake in the Italian brand Shir?.

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MILAN — Schottenstein Stores Corp. is venturing in the luxury goods market with a newly formed unit, Schottenstein Luxury Group, and has taken a 50 percent stake in the Italian brand Shirò.

This story first appeared in the July 16, 2008 issue of WWD.  Subscribe Today.

Financial terms were not disclosed.

“We are very bullish about the global luxury marketplace, and we see a real opportunity even in this marketplace,” said Lee Applbaum, chief marketing officer of SLG.

SLG, which is based in Columbus, Ohio, includes the Judith Leiber brand. Pegasus Capital Advisors sold a majority stake in Leiber to Schottenstein Stores in May.

“We will be able to announce another acquisition in a few weeks,” Applbaum said. “There are several other fashion brands we are looking at and/or in the process of acquiring. We plan to pull together a family of iconic and emerging brands that bring unique and diversified exciting points of view in fashion and Shirò is the epicenter of what we are doing, the perfect fit.”

Although there is an affiliation with Schottenstein Stores Corp. through its chairman Jay Schottenstein, Applbaum said SLG’s management team “is a combination of tenured members and new members with specific experience in the luxury goods arena.”

A “strategic but aggressive push” will be made to open Schirò stores, with merchandise that includes bags, apparel, shoes and small leather goods, in fashion destinations, he said.

A Shirò unit is to open next year on Madison Avenue in Manhattan, followed by boutiques in Las Vegas, Los Angeles, Monte Carlo and Dubai. A store in Moscow is planned to launch by early 2009, and a store opened in Tokyo in March. There are 30 wholesale points of sale, including Saks Fifth Avenue and Neiman Marcus.

Shirò’s boutique in Milan’s central Via Gesù, opposite the city’s Four Seasons Hotel, will reopen in October after extensive renovations, Applbaum said.

Designer Massimo Calestrini, the founder of Shirò, said: “I have a deep respect and admiration for Americans, because they are educated and prepared and able to understand the value of products such as ours, and this helps balance the difficult economy.”

The designer said he was the first to pleat ostrich and crocodile hides and lists cashmere cardigans lined with sheared mink and with crocodile toggle closures among the brand’s top products.

Calestrini launched his own line at the end of 2003, with production in Bologna, Modena and Florence.

“We are extreme and exclusive luxury, but not only in terms of price, but because of the special hides, put together by skilled hands,” he said “Shirò is about Italian craftsmanship.”

Retail prices range from 150 euros, or $219 at current exchange, for small leather goods to 6,000 euros, or $8,768, for a crocodile bag, while jackets retail at around 4,500 euros, or $6,576, and upwards depending on the hide.

Calestrini said he expects to expand Shirò’s range of products. Giacomo Santucci, luxury goods consultant at Value Partners here, who has been tapped to help on the industrial plan, forecast entering the jewelry and home arenas.

“The key is to be special, there are so many new brands on the fashion scene, but not many truly special,” Applbaum said. “We will expand Shirò’s products, but not trade down, nor compromise on quality.”

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