DELUXE SHOPPING SPREE
MILAN — On the runways, Gucci and Prada are showing their fall wares, and behind the scenes, they’re fortifying their industrial machinery. On Thursday, both companies announced the purchase of factories: Gucci for watches and Prada for leather apparel.
Gucci said it would acquire 100 percent of two Swiss companies: Di Modolo Associates SA, a design studio and Di Modolo SA, a factory that makes timepiece components, bracelets and jewelry watches. Di Modolo’s volume last year was estimated at about $18 million.
Meanwhile, Prada said that it took a 70 percent stake in Florence-based Santacroce SRL, which has made leather clothing for the group for 12 years. Santacroce also produces a signature line and manufactures for other labels, among them, Neil Barrett. A Prada spokeswoman said that Santacroce would continue to produce its signature line and possibly other brands. The remaining 30 percent of the company will remain in the hands of its original owners. Last year, the firm reported sales of about $10 million. (Dollar figures are based on current exchange rates.)
Neither company disclosed the terms of the deals.
As for the Gucci deal du jour, the Di Modolo studio, run by designer Dino Modolo and previously owned by him, has been designing high-end watches for more than 20 years. It manufactures for Bedat & Co. — which Gucci purchased last December — as well as for Cartier and Vacheron Constantin.
Modolo will collaborate with Gucci Group creative director Tom Ford to create a new line of Yves Saint Laurent timepieces, but a launch date for the collection has not been finalized.
In a statement, Gucci Group president and chief executive officer Domenico De Sole said that the acquisitions will help the firm develop its existing Swiss watch business, which also includes the Gucci watch operation and Boucheron. He has said earlier that the watch and jewelry sector, prized for its high margins and its resilience to the ups and downs of fashion, was a high priority for Gucci.
Thursday’s announcements also underline that fashion’s biggest luxury groups are not only keen to control distribution, but their means of production as well.