MILAN — At least Patrizio Bertelli and Miuccia Prada can relax.
While some of their luxury peers sweat on negotiations with bankers that could determine the survival of their businesses, the lenders to Bertelli and his wife’s investment vehicle Prada Holding BV have agreed to postpone until 2012 the term payment of 450 million euros, or $641.8 million, of the group’s debt, WWD has learned.
The extension — which banks Intesa Sanpaolo, Unicredit, Calyon, Banca Leonardo, Banco Popolare and Centrobanca agreed to last week following months of talks — alleviates any pressure on the couple to sell a stake in Prada SpA to generate funds and possibly sets a deadline for the firm’s eventual flotation, sources said Monday. Prior to the new accord, 100 million euros, or $142.6 million, of the sum was due to be repaid in July, while 350 million euros, or $499.2 million, matured in July 2010.
The news confirms a report in WWD in June. Representatives of the holding company could not be reached for comment on the new debt deal on Monday.
Amsterdam-based Prada Holding, through which Bertelli and Miuccia Prada control 95 percent of Prada SpA, has debts totaling 650 million euros, or $927.1 million. Separately, Prada SpA, which operates the Prada, Miu Miu, Car Shoe and Church’s brands, closed fiscal 2008 with net debts of 537.4 million euros, or $784.6 million. Earnings before interest, taxes, depreciation and amortization for the period reached 282.2 million euros, or $412 million.
Dollar figures were converted at average exchange rates for the periods to which they refer.
Prada Holding’s new loan terms effectively buy Bertelli a few years to focus investments on ongoing expansion plans for his fashion empire. These aim to generate more than 70 percent of consolidated turnover from directly operated stores by 2011, which would be a significant increase from around 53 percent currently. The new loan terms also bolster the Prada chief executive’s resolve not to sell a minority stake to third party investors ahead of an eventual listing on the Milan Bourse, which, if it does ever happen, will now likely do so before 2012. As reported in June, private equity firms including Carlyle, TPG, Investindustrial and Clessidra have been circling since Prada called off plans for an initial public offering last year for the fourth time this decade, citing market conditions.
However, some of Prada’s peers have not been afforded the luxury of such breathing room. In Italy alone, eyewear maker Safilo Group SpA is in dire straits after recapitalization talks with private equity funds Bain Capital and PAI Partners fell through last week, despite securing an extension to the end of the year on a loan payment due in June and a waiver on the respective debt covenants; Mariella Burani Fashion Group SpA has asked creditor banks for a standstill agreement on its debt and confirmed Monday it is seeking to raise up to 50 million euros, or $71.3 million, via a capital increase as part of a debt restructuring program. IT Holding SpA, which owns the Gianfranco Ferré, Malo and Extè brands, and production and licensing subsidiary Ittierre SpA, which operates under the license the Just Cavalli, VJC Versace, Versace Sport, C’N’C Costume National and Galliano labels, filed for the Italian equivalent of Chapter 11 bankruptcy protection in February after running out of cash.
Meanwhile, a Prada spokesman on Monday denied a report in Saturday’s edition of Italian daily La Repubblica that claimed Prada’s lenders had contacted Swiss luxury group Compagnie Financière Richemont SA about taking a 30 percent stake.
Harrods plans to remove the famous statue of Princess Diana and Dodi Al Fayed from the bottom of the Egyptian escalators and hand it back to Mohamed Al-Fayed. “We are very proud to have played our role in celebrating the lives of Diana, Princess of Wales and Dodi Al Fayed at Harrods and to have welcomed people from around the world to visit the memorial for the past 20 years,” said Michael Ward, Harrods managing director. “With the announcement of the new official memorial statue to Diana, Princess of Wales at Kensington Palace, we feel that the time is right to return this memorial to Mr. Al Fayed and for the public to be invited to pay their respects at the palace.” More on the news, with reporting by @loreleimarfil, at WWD.com. #wwdnews
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The fashion world mourns for celebrated street style photographer, Nabile Quenum, who died at age 32 in Paris.
Quenum, creator of the fashion blog “J’ai Perdu Ma Veste,” was a fashion week fixture, and regularly shot for New York magazine’s The Cut, among other outlets, and brands such as Louis Vuitton, Moncler and Adidas. He was also actively involved in the #NoFreePhotos initiative, which kicked off in the fall. Read more about Quenum in @kbsmoke's story on WWD.com. #wwdnews
@verwanggang and @maisonladuree have teamed up on a dessert collab called Vera Wang Pour Ladurée. The collection, which launched this week, features a specialty macaroon, as well as a wedding cake inspired by one of the designer’s gowns. “I could not imagine a more delicate or sophisticated creation to grace any couple’s celebration,” said Wang. #wwdfashion