PARIS — Designer sportswear firm Plein Sud is the latest company to succumb to a tough operating climate for independent fashion houses.
The commercial court here appointed an administrator to sell assets of the French brand’s holding company, Amor SA. Taoufik El Amrani, Amor SA’s general manager, said that it would lay off 275 people and that the future of Plein Sud’s nine boutiques was uncertain, including locations in New York, London, Paris, Taiwan and Madrid, most of which are franchised.
El Amrani said discussions were under way with an unidentified “Italian industrialist” to acquire the Plein Sud brand, which Amor SA has operated through license. It would take a transaction within the next few weeks to assure production of Plein Sud’s spring-summer 2005 collection, he said.
Plein Sud was in expansion mode as recently as 2002, opening a 2,500-square-foot boutique on Avenue Montaigne, Paris’s ritziest retail strip. The brand, prized for its buttery leathers and sexy jersey, also enjoyed a celebrity following, with fans such as Madonna and Jade Jagger.
Still, “over the last few years we’ve suffered dramatically,” said El Amrani, blaming the post-Sept. 11 economy, the war in Iraq and the escalating value of the euro.
Plein Sud is the most recent fashion firm here to hit hard times. Money-losing Jean Paul Gaultier is restructuring in a bid to save its couture operations. Martine Sitbon, Balmain and Georges Rech are all in the French equivalent of Chapter 11 bankruptcy protection. Sitbon faces a deadline of the end of this month to find a solution.
Plein Sud, founded by designer Faycal Amor in 1986, reported that sales for the 12 months ended Sept. 30 fell 25 percent to $35.1 million, or 27 million euros, from $48.1 million, or 37 million euros, a year earlier. Figures were converted at current exchange rates.
Earlier this year one of Plein Sud’s largest franchise operators, French retailer Alain Adjadj, applied for court protection from his creditors.
El Amrani said Amor SA’s debt is $13 million, or 10 million euros. The factory in France that Amor SA owned and which produced Plein Sud’s collections is being closed, he said.
The company’s financial struggles began in 1996, when it was granted protection from creditors for debt of $13 million, or 10 million euros. In 1997, the commercial court here ordered Amor SA to pay $1.3 million a year to creditors for 11 years.
“The recent downturn made it impossible to keep that obligation,” El Amrani said.
— Robert Murphy