MILAN — IT Holding SpA may be one step closer to securing a white knight.
The Italian fashion group, which owns the Gianfranco Ferré, Malo and Exte brands and operates under license the Just Cavalli, Costume National C’N’C and Galliano labels, said Friday its board had given company chairman Tonino Perna “a wide mandate” to continue talks with Mensun Ltd., a company represented by Chinese businessman Billy Ngok. The discussions are on an exclusive basis until Dec. 31.
IT Holding did not explain the extent of the mandate, and a company spokesman declined to give details, although Italian newspapers speculated any deal could involve the sale of a majority stake in Ittierre, the fashion group’s clothing-making unit.
In September, IT Holding said it was in negotiations with an investor fronted by Ngok regarding the possible sale of a minority stake in PA Investments SA, IT Holding’s parent company, and possible commercial and production agreements in the Asian market.
Also Friday, IT Holding said its board had approved the resignation of company director Antonio Di Pasquale in order to appoint an executive director, who also will serve as chief executive officer.
IT Holding is under intense pressure due to the size of its debt and a string of poor results.
In November, the group forecast an 8 percent drop in full-year revenues and a lower profit margin, after a net loss of 10.1 million euros, or $15.4 million, in the first nine months of the year, compared with earnings of 6.6 million euros, or $8.9 million, in the same period in 2007.
Revenues through Sept. 30 fell 7 percent to 468 million euros, or $712.5 million, while earnings before interest, taxes and depreciation dropped 16 percent to 83.2 million euros, or $126.7 million.
Dollar figures were converted at average exchange rates for the periods to which they refer.
As of Sept. 30, following a reduction in working capital, IT Holding’s debt was 295.4 million euros, or $428 million, including a 185 million euro, or $233.4 million, bond, which expires in 2012.
In 2007, EBITDA reached 115.6 million euros, or $158.5 million, although Intesa Sanpaolo has estimated IT Holding’s net debt will exceed EBITDA by 4.7 times next year, well over the normal limit for luxury groups of 3 to 3.5 times. PA is laden with around 140 million euros, or $175.6 million, in debt.
Moody’s Investors Service and Standard & Poor’s downgraded IT Holding’s credit rating after the company failed to pay a 9.4 million euro, or $11.9 million, principal installment on its unrated bank loan due Oct. 20, which lender Intesa Sanpaolo SpA agreed to postpone until Dec. 22. The ratings agencies noted that the weakening market conditions could further undermine the Italian firm’s ability to service its debt and make interest payments.
Perna controls nearly 61 percent of IT Holding via PA and a further 1 percent via GTP Holding SpA, a separate holding company for PA.
IT Holding has lost more than three-quarters of its market value in the last 12 months, although its stock closed up 2 percent to 0.28 euros, or 35 cents, Friday.
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye