MILAN — Corneliani may by headed to greener pastures by way of a fresh investment.
Although no formal offer has been submitted, Italian fashion marketplace BasicNet — which controls a range of labels including Kappa, K-Way and Superga, and which is known for targeting ailing brands in its merger and acquisition activities — is considered a front-runner to make the investment.
Suggesting the interest of BasicNet’s president Marco Boglione in the Mantua, Italy-based luxury men’s wear brand was his presence at the virtual roundtable organized by the Italian Ministry for Economic Development to discuss the future of the Corneliani brand.
As part of the company’s composition with creditors procedure submitted in June amid declining sales exacerbated by the COVID-19 pandemic, the Court in Mantua, Italy has allowed Corneliani to continue operating until April 15, when a resolution is to be found.
Corneliani is waiting to receive a 10 million euro investment from the Italian government through the Ministry for Economic Development, which will safeguard Corneliani’s continuing operations, but the state intervention, which falls under the “Re-Launch” Decree developed by the Italian government to support the restart of the country after the global pandemic, will be effectively unlocked when Corneliani finds a third investor.
Bahrain-based investment fund Investcorp acquired a majority stake in the company in mid-2016 in a deal estimated at around $100 million, while the Corneliani family holds a 20 percent minority interest.
Italian unions Filctem Cgil, Femca Cisl, Uiltec Uil jointly said Wednesday after the meeting that “time is running out” and urged the company’s board and investors to secure the funds necessary for the company to continue operating until a new investor is found and a deal closed. This would entail also postponing the Jan. 29 board meeting to a later date.
In their statement, the unions praised the commitment of minority shareholders and institutions toward the brand, while reiterating they would challenge any board decision that could force the company to file for liquidation, thus putting jobs at risk. The company has about 1,200 employees worldwide.
Earlier this year, Giorgio Brandazza, who joined the brand in December 2019 as chief executive officer, told WWD that Investcorp had invested around 50 million euros in the company and was ready to support its relaunch. But he underscored the fund was looking to be joined by another investor.