MILAN -- The sale of Simint USA, the company behind the troubled A/X Armani Exchange jeans and sportswear business, is imminent, according to sources familiar with the negotiations.

Sources say the buyer appears to be someone already close both to Simint and Armani: Simint shareholder and Armani distributor Ong Beng Seng of Singapore.

A Simint spokesman in Milan said he could neither confirm nor deny the reports of an imminent sale to Ong Beng Seng.

"The final contract hasn't been signed, and until it is I cannot comment," he said.

Giorgio Armani, who controls 22 percent of Simint's Modena-based parent company Simint SpA, which produces the Armani jeans and sportswear, was out of town and could not be reached for comment. Armani is Simint's largest shareholder.

Despite previous references made by Simint to "a number of interesting offers" that reportedly had been collected by merchant bank J.P. Morgan -- which was given a mandate in April to sell the company -- the sources said Ong Beng Seng appears to be the sole suitor for the A/X business.

A/X Armani Exchange consists of a network of some 35 stores across the U.S., including a flagship store in SoHo, and corner boutiques in Bloomingdale's and Saks Fifth Avenue. Observers familiar with Armani and the Ong group say an agreement between the two could make a lot of sense.

Ong Beng Seng, which controls 1 percent of Simint USA and recently boosted its stake in the parent company to 21 percent, already distributes Armani jeans and sportswear lines in the Far East and in the U.K., where it also handles Emporio Armani.

"In Ong, Armani already has a partner that is interested in distribution, not in production," one source familiar with the business said. "With this agreement they could further develop the correct distribution of Armani's products in the interests of both."

As reported, the A/X business, which was launched with fanfare in late 1991, has been floundering. With prices high for a sportswear market filled with competitors such as The Gap, The Limited and Banana Republic, sales failed to live up to expectations -- not to mention to millions of dollars of investments that were poured into the project.According to sources close to Simint, the U.S. company is carrying an accumulated loss of 60 billion lire ($38 million), although the most recent official figure was a loss of 22 billion lire ($14 million) in the first 10 months of 1993.

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