COSTA GETS CLOSE: After lengthy — and sometimes public — negotiations, Francisco Costa, creative director of Calvin Klein Collection for women, is finally close to having a new contract. “It’s being finalized at the moment,” said a CKI spokesman.

Costa went public last February, saying he was in the midst of renegotiating his contract and was frustrated with CKI and Phillips-Van Heusen, as well as what some perceived to be a lack of commitment to the women’s collection. But in June, Costa received the Womenswear Designer of the Year award from the Council of Fashion Designers of America and a week later said, “My life has changed. I have a greater responsibility to push the brand even further.”

Meanwhile, the New York Post reported Wednesday that Calvin Klein decided not to renew a consulting agreement with the firm, but a CKI spokesman told WWD that Klein’s three-year contract with the house had ended back in February. “Mr. Klein had a three-year consulting contract with PVH in order to ensure a smooth transition,” the spokesman said. “As planned, the contract ended in February 2006. While PVH has a cordial relationship with Mr. Klein, Mr. Klein no longer has any formal relationship with the company.” However, Klein continues to gain financially from the company’s success. As part of his deal, he is guaranteed an annual payment of 1.15 percent of worldwide wholesale sales of all merchandise bearing his label until 2018. Products bearing the Calvin Klein label generate global sales at retail of $4 billion annually.

Aside from those lucrative payments, what’s up next for Klein? The designer isn’t giving any interviews these days, but he’s said to be contemplating two new genres: writing a book on style or opening an art gallery.

AEFFE IN PLAY: Merchant bank San Paolo IMI Private Equity is preparing to sell its 20 percent stake in Aeffe SpA back to the Ferretti family, according to a banking source here. Aeffe’s spokeswoman could not be reached for comment at press time. San Paolo bought the stake in 2000, but it’s been looking for an exit strategy for more than a year. Aeffe’s original plan was to do an IPO, an idea that has since been scrapped. Over the years, Aeffe embarked on an acquisitions binge to buy Moschino in 1999 and Pollini in 2001. The company also has licensing deals with Narciso Rodriguez and Jean Paul Gaultier. Aeffe posts annual sales of about 250 million euros, or $313 million at current exchange.

This story first appeared in the July 21, 2006 issue of WWD. Subscribe Today.

SMITH TAKES PARIS: Paul Smith is set to make a bigger splash in Paris this November when he opens his second store, a 3,700-square-foot flagship on the city’s Right Bank shopping thoroughfare, Rue du Faubourg Saint-Honoré. The space will carry the entire Paul Smith line, including women’s and men’s collections, and will boast Smith’s signature eccentric touches, such as a library and select pieces of furniture on sale. Smith’s existing Paris store, which opened in 1993, is on the Left Bank’s Boulevard Raspail.

DE SOUZA’S NEW BEAT: Victor de Souza is joining the number of designers who moonlight. He’s just been tapped to head the design at Rushkin, the label founded by Godfrey Sowah and Chris Chea last season. While Rushkin’s first season didn’t take off at retail, the co-founders are hoping to make more of a mark with de Souza, whose first collection for the label will be for spring 2007. The line opens to the trade in mid-August, and the company targets upscale department and specialty stores with it. De Souza will continue to produce his namesake label, which he launched in 2002 and shows during New York Fashion Week.

TARGET ON THE RUN: Target turned to Bart Yasso, race and event director of Runner’s World magazine, who has finished 150 marathons, to help whip 150 of its employees into shape in time for Wednesday night’s Life Time Fitness Torchlight 5K in Minneapolis. As one of the magazine’s advertisers, the mega-chain wanted to boost staffers’ health, and the mag delivered by shipping out Yasso for an on-site pep talk at Target’s Minneapolis headquarters. In May, Yasso and RW’s lead nutritionist Liz Applegate tag-teamed the Target troops with running tips and a training run.

There are no financial criteria for advertisers to score such personalized treatment, and the pub hopes to offer similar programs soon, an RW spokesman said.

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