By  on November 14, 2006

MILAN — Benetton Group SpA bid farewell to both its chief executive and chief financial officers on Monday and said it could take months before the company hires replacements.

Chief executive Silvano Cassano and chief financial officer Pier Francesco Facchini resigned, effective immediately, Benetton said Monday. In a sign of just how sudden their departures were, neither executive participated in a conference call on the company's third-quarter numbers. Investor relations and public relations personnel fielded queries from puzzled analysts and journalists. Meanwhile, investors sent Benetton shares down 8.5 percent to close at 14.05 euros, or $17.98, on the Milan Stock Exchange.

Net profits for the three months ended Sept. 30 rose 17.2 percent to 30 million euros, or $38.4 million, boosted by one-time gains. Sales advanced 6.1 percent to 474 million euros, or $606.7 million, as the company cited "significant" growth in Mediterranean countries, Eastern Europe, China and India.

(Dollar figures have been converted from the euro at average rates for the period to which they refer.)

Cassano and the Benetton board clashed over international strategy, especially in emerging markets such as Asia, Mara Di Giorgio, head of Benetton's investor relations, admitted during the conference call. However, a Benetton spokesman said Cassano chose to leave the company, while Facchini stepped down for personal reasons.

The company is just beginning its ceo search and hopes to have the new executive, probably an outsider, in place by May, the spokesman said, adding a cfo appointment could come earlier. Senior and middle-level executives will oversee daily management of the company, while chairman Luciano Benetton and his son, vice chairman Alessandro Benetton, will continue to administer overall strategy, Di Giorgio said during the call. Cassano will remain a board member until his mandate expires next May.

"There was a different vision about the future growth of the company," the spokesman said of Cassano's departure.

Benetton said in its statement that one of the new ceo's responsibilities will be developing Benetton, especially in the Far East.

Clearly the company is in a transitional phase in more ways than one. Alessandro Benetton, the 42-year-old scion of the family empire, will take the reins sometime next year when his father retires. Still, the timing of this handover hasn't been specified. Alessandro will oversee strategy in his new, enlarged role but he won't become ceo or oversee day-to-day management, the spokesman said.

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