AMSTERDAM — Pinault-Printemps-Redoute is playing for keeps.

PPR, the white knight that saved Gucci from LVMH Moët Hennessy Louis Vuitton’s hostile takeover bid back in 1999, is set to become the sole shareholder of Gucci next year and intends to keep it that way. PPR doesn’t have plans to sell off any of its shares in the Italian company because the French retailer is aiming to transform itself into a luxury goods heavyweight, said PPR chief executive Serge Weinberg.

“We think it’s coherent to have the full stake in Gucci,” Weinberg said on the sidelines of what appeared to be Gucci’s last stockholder meeting as a publicly traded company. “It’s our strategy to really become a major player in this industry.”

Weinberg noted that PPR has sold off a variety of its businesses to focus on brand-oriented enterprises, whether they be “retail or luxury.” PPR’s other brand-related holdings include department store chainPrintemps and book and music retailer FNAC.

PPR, which releases second-quarter revenue numbers Thursday, is obliged to make an offer for all outstanding shares of Gucci in March of next year, a move expected to give PPR 100 percent of Gucci and likely delist it from the Amsterdam and New York stock exchanges.

At various points in time, there has been speculation that PPR might refloat Gucci with an initial public offering. PPR also has a history of entering and exiting different sectors through acquisitions and disposals. Over the years, PPR has been involved in a number of industries, ranging from office furniture and stationery to timber wood and financial services.

Weinberg said that when PPR bought about 40 percent of Gucci for nearly $3 billion in 1999 to help thwart the LVMH bid, the investment was more than a “purely financial move.” He also announced Wednesday that PPR has since increased its stake in Gucci to 64.5 percent from the previously disclosed holding of 63.7 percent. PPR had said it plans to increase its stake to about 70 percent of Gucci by the end of this year. PPR had authorized Credit Agricole Indosuez Cheuvreux to buy up to 1 million Gucci shares between June 11 and July 6.

Elsewhere, Gucci’s chief executive Domenico De Sole reiterated statements he’s made over the past few weeks that trading conditions have improved “remarkably” since the conclusion of Gucci’s first quarter on April 30. As reported, Gucci saw its first-quarter net income plunge 96.6 percent to $1.3 million, or 1.2 million euros, as sales dropped 6.7 percent for the period to $634 million, or 567.1 million euros.“The first quarter was the most difficult that we have ever experienced,” De Sole told shareholders, attributing the weak results to a whirlwind of negative factors from SARS and the war in Iraq to a strong euro. But he was quick to add that better trends in May, June and the beginning of July have given him hope that Gucci will post “very strong profitability” in 2003.

“We are very positive about the performance of the company in the second half,” he said.

Weinberg was similarly unfazed, saying the economic turmoil won’t derail the group’s strategy.

“You don’t determine a strategy on tumults,” he said.

François-Henri Pinault, a Gucci and PPR board member as well as the son of PPR founder François Pinault, voiced a similar enthusiasm about the luxury goods industry in an exclusive interview with WWD last month. His father handed him the reins of the family holding company Artemis in May, making him the emerging power behind the family fortune.

“There will be another boom in the luxury sector,” said Pinault. “At present, the market is Japan, Western Europe and the United States. Tomorrow it will include China and the rest of Asia, which will be more important in terms of volume than Japan. Add to that all of the countries in Eastern Europe. As the population gets richer, they will aspire to luxury brands.”

While industry watchers may be pondering when that next boom could happen, they are also questioning whether De Sole and creative director Tom Ford will still be at Gucci to witness it. Both have contracts that expire next year and there is speculation that one or both of them could bolt over tensions with PPR. De Sole and Ford have said they will stay only if PPR grants them managerial autonomy.

Weinberg said the world will have to wait. Reiterating comments made recently by both De Sole and PPR officials, he said talks are ongoing.

“We’ve got time. We’re working on it,” he said.

Gucci shareholders voted in favor of a variety of proposals at the meeting. Chief among these measures, they approved Gucci’s 2002 accounts showing a 27.4 percent decline in net profit to $253.6 million, or 226.8 million euros, with revenues virtually flat at $2.84 billion, or 2.54 billion euros. Dollar figures have been converted from the euro at current exchange.They also renewed the mandate for the eight-member supervisory board and the three-member management board, the latter of which includes Ford, who was named to the board last year in a move to recognize his strong role in the corporate side of Gucci.

Shareholders also accepted Gucci’s plans to use part of its cash pile for an exceptional pay out of 13.50 euros per share, or about $15.09 at current exchange rates. Doing so will leave Gucci with cash and cash equivalents “well above” $1.12 billion, or 1 billion euros, and should result in net debt “approaching zero” by the end of this year.

Gucci said it decided to give the cash back to shareholders because it is busy turning around its newly acquired brands and it doesn’t foresee making any additional significant acquisitions. Gucci also noted that it had surplus cash invested in low-risk, low-return financial instruments.

The 13.50 euros, converted into dollars at exchange rates set Oct. 2, will be subtracted from the $101.50 per share price PPR must offer for all Gucci shares in March of next year.

Elsewhere, shareholders approved plans allowing Gucci to allocate another 1.25 million shares to its stock option plan for employees. As of June 1, Gucci only had the means to grant further options for 300,237 shares. These options can produce windfalls. Most recently, Ford made $38 million by buying and selling his Gucci shares over the months of April and May.

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