By  on December 23, 2008

MILAN — Two credit ratings services downgraded IT Holding SpA on Tuesday after the Italian fashion group asked lender Intesa Sanpaolo SpA to postpone for a second time a 9.4 million euro, or $11.9 million, payment on a loan that was due Monday.

The company, which owns the Gianfranco Ferré, Malo and Extè brands and operates under license the Just Cavalli, Costume National C’N’C and Galliano labels, is seeking to delay the payment until April 18. It was initially due on Oct. 20. Moody’s Investors Service lowered IT Holding’s Corporate Family Rating and Probability of Default Rating to Ca from Caa1. Paolo Leschiutta, vice president at Moody’s and lead analyst for IT Holding, said the “rating downgrade follows the operating difficulties the company is facing due to adverse market conditions and soft consumer spending and Moody’s view that ongoing uncertainties on future operating performances might challenge the company to obtain further support from key banks.”

Standard & Poor’s Ratings Services lowered its long-term corporate credit rating on IT Holding to SD (selective default) from CC (very speculative).

IT Holding said this month that it had reached a nonbinding agreement with China’s Mensun for “a possible disposal of assets” belonging to the Italian fashion group. It did not disclose what assets it could sell to Mensun, although there has been speculation that the deal involved a majority stake in Ittierre SpA, the fashion group’s apparel manufacturing unit.

IT Holding said Tuesday that Maurizio Negro, chief executive officer of Ittierre, has resigned for personal reasons, and that no successor was appointed. The post will remain vacant until the next board meeting.

Standard & Poor’s said IT Holding’s “uncertainty over the timing and structure of the transaction” with Mensun, a company represented by Chinese businessman Billy Ngok, “makes it difficult to quantify the benefits to ITH’s business and financial profiles.

” IT Holding this month appointed turnaround specialist Pierantonio Nebuloni as chief executive officer, replacing Tonino Perna, who remains chairman. The company previously said the board had given Perna “a wide mandate” to continue talks with Mensun. The discussions are on an exclusive basis until Dec. 31.

The Italian fashion group has lost more than 80 percent of its market value in the last 12 months. The stock was down 16.7 percent Tuesday to close at 0.18 euros, or 25 cents.

IT Holding is weighed down by the size of its debt, which, as of Sept. 30, following a reduction in working capital, was 295.4 million euros, or $428 million, including a 185 million euro, or $233.4 million, bond, which expires in 2012.

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, and 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

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