EXCLUSIVE – Fosun International wins auction for Lanvin
China’s Fosun International has beat Qatar’s Mayhoola and won the bidding contest for French fashion brand Lanvin against the odds in a deal that should lead to an investment of more than 100 million euros, two sources close to the matter have said.
An announcement is expected to be made to Lanvin’s staff this week, they added. The sale agreement signed late on Friday comes weeks before France’s oldest fashion brand was expected to run out of cash. As of December 15, Lanvin disposed of a little over 15 million euros to pay salaries and suppliers until the end of February-early March, several financial and industrial sources had said.
The deal will see Fosun International invest more than 100 million euros in Lanvin with the company issuing new shares to its new controlling shareholder, one of the sources said. Chinese media magnate Shaw-Lan Wang based in Taiwan will lose control and remain a minority shareholder alongside Swiss German entrepreneur Ralph Bartel who put in new money as he wished to retain a stake, it said. It remains unclear how much of the cash injection would eventually go to Wang.
The news is disappointing for Mayhoola which has been actively courting Lanvin on and off for more than a decade and was ready for another revival after having successfully invested in Valentino and Balmain.
“It is a surprising decision,” one of the sources said. “This is a complex affair, many will be watching how Fosun handles it.”
Sales at Lanvin have dwindled in recent years as the brand struggled to find a convincing creative voice and hire high-calibre executives after ousting celebrity designer Alber Elbaz in 2015.
Fosun International is a group controlled by Shanghai billionaire Guo Guangchang with interests in insurance, trading and many other businesses including French holiday operator Club Med and knitwear band St. John in the United States.
“Fosun has won Lanvin and an announcement should be made this week,” one of the sources said.
No-one at Lanvin, Fosun International and Mayhoola was immediately available for comment late on Sunday.
To save money, Lanvin has cancelled its show at Paris Fashion Week scheduled for February 28 and replaced it by a presentation, the Fédération de la Haute Couture et de la Mode said.
Just before Christmas Elbaz won his claim against Lanvin’s parent company, Jeanne Lanvin SA for having ousted him before his contract was due to end. Following a settlement through arbitration (an out-of-court procedure), Elbaz was awarded more than 10 million euros in compensation, several sources have said, which will put added pressure on Lanvin’s finances.
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