PHILO GETS CHLOE
STELLA, GUCCI CEMENT DEAL FOR INTERNATIONAL FASHION LABEL, STORES
Byline: Miles Socha / Samantha Conti
MILAN — Stella McCartney and Gucci Group finally completed their deal and Gucci plans to waste no time in building the designer’s label.
McCartney ended weeks of speculation by confirming Monday that she is leaving Paris-based Chloe to launch her own fashion house in partnership with Gucci Group. McCartney will be creative director of the new company, which is a 50-50 joint venture between the designer and Gucci. The possibility of a deal between the two parties was first reported in WWD on Feb. 28.
Also on Monday, Chloe, which had been discreetly girding for McCartney’s exit, named Phoebe Philo, McCartney’s longtime design assistant, as its new creative director. (See story, page 13.)
Meanwhile, Gucci said it would move swiftly to build McCartney into a “global luxury brand” focused on women’s ready-to-wear and accessories. “Stella McCartney is a very strong creative talent with great name recognition, and we are very excited about building her business,” said Gucci Group chairman Domenico De Sole in an interview.
De Sole said that while negotiations had been long — they began several months ago — Gucci planned to get to work immediately on the new company, which will be an independent entity under the group umbrella.
“We’ll start looking at store locations very quickly. We’re not wasting any time,” he told WWD. Gucci and McCartney said in a joint statement that they planned to open directly operated stores in key fashion capitals around the world over the next few years, and distribute through luxury wholesale channels.
De Sole declined to comment on the terms of the deal and on any details regarding McCartney’s fashion house. He did not say when McCartney’s collection would bow.
“We are revising our business plan, and no final decisions have been made. They should come over the next few days,” he said.
Industry sources said it was likely that the designer would base her business in London and show in Paris.
McCartney was not immediately available for comment. However, in a statement, she said that she was “incredibly excited about the decision to launch my own label. In Gucci Group, I have found a partner with the skills necessary to make this business a success…I feel ready for the challenge.”
It was Gucci Group creative director Tom Ford who introduced McCartney to De Sole.
“Stella is very good friends with Tom, and he has so much respect for her.
Stella is a thoughtful person and very committed to her career. Everything she produces is done with the greatest integrity,” De Sole added.
Ford said McCartney’s clothes “have an enormous appeal to women around the world…her design talent, energy and star power will insure her continued success.”
De Sole said that McCartney would not be working on other collections within the group, which controls the Gucci, Yves Saint Laurent, Sergio Rossi, Roger & Gallet, Boucheron, Bottega Veneta, Alexander McQueen and Bedat & Co. brands.
“The deal is very clear. Stella was very interested in launching her own brand,” De Sole said.
Industry sources said that while Gucci and McCartney jointly own the new company, Gucci is in the driver’s seat.
“Gucci has control. In the unlikely event there is a dispute, Gucci has the casting vote on the board,” said one source.
Gucci said that the joint venture would be consolidated in its financial statements, but that the impact on its financial condition and near-term earnings per share “were not expected to be material.”
Analysts and retailers largely welcomed the news.
“It’s obviously a brilliant opportunity for Stella,” said Kal Ruttenstein, senior vice president of fashion direction for Bloomingdale’s. “We know she knows how to reach young women who want to look sexy and chic, and I’m sure she’ll continue to do that.”
Meanwhile, Ruttenstein added that “Chloe is fortunate to have Phoebe in the wings and I’m sure she’ll carry on in Stella’s tradition.”
Anne Catherine Galetic, a luxury goods analyst at Schroder Salomon Smith Barney in London, said the recruitment of McCartney “suggests that Gucci is currently a place where some talented designers want to be. Whether or not the Stella McCartney brand ever succeeds, one positive aspect is that Gucci is bringing a talented designer into the group.”
Jacques-Franck Dossin, an analyst at Goldman Sachs in London, said investors would greet McCartney’s arrival with relief, given their concerns that the company might be too dependent on Ford’s talents. “Stella McCartney is a good designer and I think there’s potential behind the name,” he said.
While characterizing McCartney as one of the industry’s hottest designers, one Milan-based luxury goods analyst said: “I do think this is a gamble for Gucci — taking a small brand and trying to build it — but I’m positive. I think it would have been a bigger risk had Gucci bought an established brand at a crazy price — 6 or 7 times sales — and invested a lot of money in trying to relaunch it.”
Antoine Colonna, an analyst at Merrill Lynch in Paris, said he expected Monday’s transaction to have no material impact on either Gucci Group or Compagnie Financiere Richemont, Chloe’s parent.
“We expect the McCartney label to be successful going forward, even if in absolute terms it is unlikely to weigh significantly on Gucci Group results,” he said. “On Richemont’s side, whilst this announcement was widely expected, we believe it should step up its focus on ‘hard luxury goods’ as the management has always considered the fashion business as non-core.”
The daughter of billionaire rock legend Paul McCartney and his late wife, Linda, the photographer, Stella McCartney rocketed to fashion stardom quickly after graduating from Central St. Martins in 1995. She started out small, showing a signature collection modeled by pals including Kate Moss, Yasmin Le Bon and Naomi Campbell. But she quickly caught retailers’ attention with such designs as slip dresses trimmed in antique lace, long silk coats, Fair Isle knits and mannish pinstriped jackets and pants.
She was tapped by Chloe to succeed Karl Lagerfeld by then-president Mounir Moufarrige, who was taken by her pretty and feminine designs. Told of Monday’s Gucci announcement, Moufarrige, who is now backing Delhi fashion designer Ritu Beri, said: “I am delighted. It was in the cards for a long time. She deserves it. I’m glad that she found a partner who equally shares her vision.”
Sources said Gucci, which is on an aggressive acquisitions drive, was never interested in buying Chloe. “That was never in the cards. They only ever talked about launching a signature line for Stella,” one source said.
Gucci rival LVMH Moet Hennessy Louis Vuitton had also expressed interest in McCartney for Givenchy, however, the two could not come to terms with a contract. Givenchy ultimately hired the British designer Julien Macdonald.
McCartney is the latest among hot young designers expected to join the Gucci st1able. As reported first in these columns Jan. 19, Gucci is in pursuit of the French house Balenciaga and its designer, Nicolas Ghesquiere.