MILAN--Committed to the restructuring of troubled sportswear maker Simint SpA, the company that manufactures the Armani jeans line, Giorgio Armani has agreed to guarantee the lion's share of a $33 million (50 billion lire) capital increase approved Friday by the board of directors. According to a Simint statement issued late Friday, Armani, who controls 22 percent of the Modena-based company, notified the board of directors in a letter that he would guarantee "up to 80 percent of the total" capital increase not underwritten by other shareholders, or up to $26 million (40 billion lire). The Armani offer is contingent upon approval by Simint's creditor banks of the firm's financial rescue plan. It is likely that Armani will have to provide the full amount he has offered to guarantee, since one of Simint's other controlling shareholders, Milan merchant bank Sige SpA, last month indicated it no longer wants to participate in the shareholders' group that controls Simint. The outstanding 20 percent of the capital increase will probably be underwritten by Finar SpA, a holding company controlled by Ong Beng Seng, the Singapore-based financial group that recently acquired Simint USA, and is also a member of the controlling shareholders pact. As reported, Armani has already contributed $46 million (70 billion lire) in deferred credits to Simint's restructuring, bringing his total financial commitment to Simint to $78 million (120 billion lire). Although this will significantly boost Armani's stake in the company, the Simint statement indicated that wasn't the goal of the capital increase, which is primarily designed to put the company back on healthy financial footing. Once the company is in good financial shape, a portion of the Armani shares will be offered to small shareholders of Simint, which is quoted on the Milan stock market. The Simint board also decided to seek legal action against former Simint management in connection with heavy losses--roughly $145 million (222 billion lire)--for the year ended April 30, 1994, that emerged after the departure of former chairman Francesco Micheli.
A Stella McCartney sketch of a custom dress made from protein-based silk in partnership with biotech lab Bolt Threads. The dress will be displayed at The Museum of Modern Art's upcoming design exhibition, "Items: Is Fashion Modern?"