MILAN — What will the Roberto Cavalli company look like in 2020? Will chief executive officer Gian Giacomo Ferraris stay on, following the sale to Dubai-based Damac Properties? Will the brand return to the catwalk after a hiatus of a few seasons? Will it hire a creative director or rely on its in-house team? What is the fate of the 200 employees in Florence? How will it find its place in the international fashion system? These are only some of the questions circling around the brand, which is not holding a presentation of its men’s fall 2020 collection at Pitti Uomo or during Milan Men’s Fashion Week.
The acquisition of the company was finalized at the end of November, as the founder and chairman of Damac Properties, Hussain Sajwani, confirmed the purchase of 100 percent of the Italian fashion house through his private investment company Vision Investments. Vision Investments, part of the Dico Group, is an evolution of a partnership that was signed in 2017 between Cavalli and the Dico Group for the development of Cavalli interiors for luxury hotels under the Aykon moniker.
Sajwani said at the time that Damac was planning to carry forward “the incredible legacy” of the Roberto Cavalli brand, which he believes “resonates with our idea of luxury.” He also said he wanted to ensure “stability in management throughout the transition period.” Ferraris is said to have been instrumental in sealing the deal.
Dico, which is Sajwani’s multibillion-dollar investment arm established in 1992, is working on a five-star hotel tower in Dubai that is expected to comprise 220 rooms and be completed in 2023. When the deal was revealed, Ferraris said this was the first of at least five Aykon hotels to open in 10 years and to be decorated by Cavalli. Damac, which is one of the top 10 companies publicly listed on the Dubai Financial Market with a market capitalization of $4 billion, is funding the project with an investment of $500 million. Damac is also building Just Cavalli villas in Dubai.
The acquisition put an end to a long series of twists and turns for Cavalli. In October, the Court of Milan approved the buyer’s restructuring plan for Cavalli after Vision Investment last summer signed a binding contract with the Florence-based fashion company and its shareholder Varenne 3. Italian private equity fund Clessidra Sgr took control of Cavalli in 2015 through its Varenne vehicle, which at the time included L-GAM and Chow Tai Fook Enterprises Ltd.
The binding agreement was in compliance with Cavalli’s “composition with creditors” with the Court of Milan and it allowed the business to continue while it held discussions with creditors and implemented a debt restructuring plan. Financial details and the amount of the debt were not disclosed, although sources peg the transaction at around 160 million euros and believe the agreement includes a capital increase of around 65 million euros and the payment of all creditors. The company’s American subsidiary Art Fashion Corp. filed for Chapter 7 and ceased all operations in April. In March, the brand’s creative director Paul Surridge exited the fashion house.