Come this fall, eyes will be on the potential development of the Roberto Cavalli brand, once a Milan judge will have ruled on the industrial plan and agreement with creditors presented by the company’s management that was due to be submitted by Aug. 3. The judge’s ruling is expected in mid-September or the following month.
Cavalli did not officially present a spring men’s wear collection in June at Pitti Uomo or in Milan and does not appear on the first draft of the Milan Fashion Week calendar issued by the Camera della Moda at the end of July. The label is still without a creative designer, following the exit of Paul Surridge in March. The design lead, however, may not be an immediate priority for the brand and its chief executive officer Gian Giacomo Ferraris, who was rumored to stay on following the acquisition by Vision Investment Co. LLC last month. The vehicle is controlled by Hussain Sajwani, the founder and chairman of the Damac Properties Group. Vision Investment has signed a binding contract with the Florence-based fashion company and its shareholder Varenne 3 to acquire 100 percent of the firm. That said, the transfer of shares to the new owner will be completed only after the judge’s decision. Sources speculate that founder Roberto Cavalli could also return to his namesake company in some capacity. This was a rumor that first arose when American fund Bluestar Alliance, which has investments in Tahari, Bebe and Catherine Malandrino, was also eyeing the acquisition of the brand.
Vision Investment’s binding agreement is in compliance with Cavalli’s so-called process of “composition with creditors” with the Court of Milan and it allows the business to continue while it holds discussions with creditors and implements a debt restructuring plan. Financial details and the amount of the debt have not been disclosed, although sources pegged the transaction at around 160 million euros, with the addition of a capital increase of around 65 million euros and the payment of all creditors. Unions have been vocal about maintaining the employment force in Tuscany, asking for guarantees that the brand will continue to be headquartered and produced in Sesto Fiorentino.
A property developer, Damac is based in Dubai and is especially keen to secure a future for the Cavalli brand because its strategic investment arm Dico International is working on a five-star hotel tower in Dubai that is expected to comprise 220 rooms and to be completed in 2023. When the deal was revealed, Ferraris said this was the first of at least five hotels, called Aykon, to open in 10 years and to be decorated by Cavalli. Damac is also building Just Cavalli villas in Dubai.
At the end of March, the Roberto Cavalli SpA board revealed that it had decided to file a restructuring plan with the Court of Milan. In the filing, Roberto Cavalli SpA requested 120 days to prepare the restructuring plan and to allow the company to continue to evaluate potential new expressions of interest to buy the brand. That was followed by Cavalli’s American subsidiary Art Fashion Corp. filing for Chapter 7, ceasing all operations.
Italian private equity fund Clessidra Sgr took control of Cavalli in 2015 through its Varenne vehicle and, in May 2016, Italmobiliare SpA, the publicly listed investment group owned by the Pesenti family, took control of Clessidra for roughly 20 million euros.