By  on December 30, 2008

MILAN — IT Holding SpA said Monday it has not extended its sale negotiating period with Mensun Ltd. beyond the end of the year, despite noises to the contrary.

“At the moment, no decision has been taken regarding the possibility of extending the exclusive terms beyond the Dec. 31 deadline,” IT Holding said, responding to market speculation that discussions could continue into next year.

Earlier this month, IT Holding, which owns the Gianfranco Ferré, Malo and Extè brands and operates under license the Just Cavalli, Costume National C’N’C and Galliano labels, said it had reached a nonbinding agreement with Mensun regarding “a possible disposal of assets,” and reportedly both parties since have signed a letter of intent.

At the time, IT Holding did not disclose what assets it could sell to Mensun, which is represented by Chinese businessman Billy Ngok, although they are thought to include Ittierre SpA, the Italian fashion group’s apparel manufacturing unit.

In September, IT Holding said negotiations concerned the possible sale of a minority stake in PA Investments SA, its parent company, and possible commercial and production agreements in the Asian market.

Last week, credit ratings agencies Moody’s Investors Service and Standard & Poor’s downgraded IT Holding for the second time in as many months after the fashion company asked lender Intesa Sanpaolo SpA to postpone for a second time, to April 18 from Dec. 22, a 9.4 million euro, or $13.2 million at current exchange, payment on a loan. The original due date was Oct. 20.

S&P said IT Holding’s “uncertainty over the timing and structure of the transaction” with Mensun “makes it difficult to quantify the benefits to ITH’s business and financial profiles.”

Also Monday, IT Holding said company director Umberto Paolucci had resigned due to a conflict of interest.

The group’s share price gained 40 percent to 0.25 euros, or 34 cents, at the close of trading on the Milan Bourse, wiping out a 17 percent decline on Dec. 23, the final session before Christmas. However, the company’s stock is still down by more than 75 percent in the last 12 months.

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