By  on July 26, 2007

MILAN — Diesel has secured one of Milan's premiere locations for a megastore planned to open in the first half of 2008, the first of five new concept stores around the world.

Diesel founder and chief executive officer Renzo Rosso said the company is eyeing prime locations in Hong Kong and Tokyo, underscoring the strong performance in the Japanese market for the brand.

"The importance of the Diesel brand in the world today warrants such spaces, which offer increased visibility," said Rosso, who will invest 8 million euros, or about $11 million at current exchange, in the new Milan location.

The megastore will overlook Milan's central Piazza San Babila, on the corner of shopping street Corso Vittorio Emanuele and a few steps away from the city's imposing cathedral. With 13 windows and covering a total of 16,200 square feet, the store is strategically positioned on a busy retail thoroughfare and on a square that's considered a meeting point for young people.

Although Rosso is still mulling details about design, he said the store will be "fresh and innovative, modern for the year 2010, and reflect Diesel's DNA — futuristic, irreverent, crazy and full of humor." Music, video, fashion and art events at the store are also in the pipeline.

There are 20 Diesel stores in Italy, all directly owned by the company, and 300 stores and 5,000 points of sale around the world. In Milan, there are three other Diesel stores. Rosso said he plans to refurbish the city's Corso Venezia flagship, which will eventually only carry premium pieces. A decision about the other two stores has not been made.

Rosso also disclosed 2006 net profits and revenues for Only the Brave Srl, which controls Diesel, Maison Martin Margiela, Sophia Kokosalaki and manufacturing arm Staff International. Staff produces and distributes Dsquared. Net profits for 2006 reached 120 million euros, or about $150 million at average exchange in 2006, and sales rose 7.2 percent to 1.18 billion euros, or $1.47 billion.

Diesel is also partnering with Vittorio Radice, ceo of La Rinascente, who is revamping the historical department store. In addition to the recent addition of Diesel's women's apparel collections, La Rinascente plans to open corners for the brand's handbags, underwear, children's and men's clothing at the Milan store."We worked very well with Radice when he was at Selfridges [where he was ceo] and we had a very positive experience with him," said Rosso. "He's turning La Rinascente into Italy's first high-end department store."

The move underscores the growth of other categories for Diesel.

"Accessories grew six percentage points in 2006 versus 2005," he said.

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