MILAN — Ittierre SpA may have secured the Just Cavalli license for another five years and perhaps its future as well, WWD has learned.
This story first appeared in the April 3, 2009 issue of WWD. Subscribe Today.
According to sources, Roberto Cavalli could sign a new contract in the next 24 hours, after being won over by Ittierre’s special administrators and their plans for his younger line. The current deal expires in 2010.
If Cavalli does so, it would mark a turning point for Ittierre, which filed for the Italian equivalent of Chapter 11 bankruptcy protection in February after running out of cash. Just Cavalli is Isernia, Molise, Italy-based Ittierre’s biggest license, generating revenues in 2007 of around 240 million euros, or $329 million, and is highly profitable. Ittierre’s other licenses include C’N’C Costume National, Galliano, VJC Versace and Versace Sport.
Dollar figures were converted at average exchange rates for the periods to which they refer.
A spokeswoman for Cavalli could not be reached for comment at press time.
A new deal would be the second major achievement for administrators Andrea Ciccoli, Stanislao Chimenti and Roberto Spada, who secured a 30 million euro, or $39.7 million, line of credit from five Italian banks at the end of February, allowing Ittierre to restart its engines and continue day-to-day operations.
“The company would be on track financially and strategically,” sources said Thursday. “This changes the perspective for everyone and signals the company will make it.”
A renewal would also signal a U-turn for Cavalli, who blamed Ittierre for having to cancel Just Cavalli’s fall-winter runway show in February, citing delays and substandard production. At the time, Cavalli said he tried to terminate the contract “some months ago” for not having been paid 20 million euros, or $26.5 million, in royalties and questioned the administrators’ abilities to turn Ittierre around. He also said he was in discussions with other potential partners, including Renzo Rosso’s Staff International, and could even take Just Cavalli’s production in-house. Cavalli’s remarks led Ittierre to threaten legal action.
Cavalli gave the first indications that relations had thawed on Wednesday, telling WWD he was committed to Ittierre.
“I will personally call between 200 and 300 of the best stores [that carry Just Cavalli] to tell them that I’m involved and I will speak to the 400 [Ittierre] workers [at the factory] in Isernia,” Cavalli said at the time.
Ittierre employs 772 people.
Sources also said a new contract with Ittierre would strengthen Cavalli’s position in negotiations with Clessidra SGR SpA. Cavalli is in talks with the private equity firm to sell a 20 percent stake in his eponymous fashion company. He last met representatives from the fund on Tuesday, when they laid out what he described as an “interesting plan.”
With Cavalli on board, the administrators will step up efforts to renew contracts with other licensors before addressing Ittierre’s parent company, IT Holding SpA, sources said.
IT Holding, which owns the Gianfranco Ferré, Malo and Extè brands, followed its production and licensing unit into administration at the end of February.