Lacroix fashion house declares insolvency *Update* Inks Deal with Ajman Sheikh

[CandiDandiStylin]

nooooo .. i love lacroix!!! how can this be..

 

[papa_levante]

White Knight
July 21, 2009

A Christian Lacroix spokeswoman declined comment Monday on reports that turnaround firm Bernard Krief Consultants plans to bid for the troubled couture house, which is in administration. Hailing Lacroix as part of France’s cultural heritage, Krief said it was the sole contender and would table its offer July 27. Lacroix’s owner, Florida’s Falic Group, plans to seek a buyer until the end of July, or activate a restructuring plan that could see the workforce cut to 12 from 124, effectively reducing the 22-year-old fashion house to a licensing operation. Recently, Krief was among bidders for bankrupt fast-fashion chain Morgan, and it bought the troubled textile firm DMC out of administration.

WWD

 

[VogueParisLover]

Hopefully this is good news. I really hope so...

 

[ponytrot]

fingers crossed for Lacroix!

 

[eternitygoddess]

I was just about to post fingers crossed before coming into the thread!

Great minds think alike!

Fingers crossed.

 

[Leeroi]

one thing overlooked remains the cash cow that must have shoes and bags have played for houses like balenciaga. i mean, you sell ten thousand units at a thousand dollars a pop and you have ten million dollars in cash flow. also, givenchy and mcqueen both have fragrance and mcqueen has gone down market to sustain himself a little longer.

also, akris, like balenciaga, and to a lesser degree mcqueen, have clientels that will follow them no matter what they may produce. also, these brands in varying degrees dress a working woman -- albeit a very wealthy working woman.

honestly, they did fail him by not forcing the house to diversify its revenue streams when they agreed to invest. i mean if we can brainstorm any number of profitable ventures, why couldn't they?

I believe that was one of the fall outs of Lacroix, the lack of accessible accessories (handbags, shoes, etc etc) to the everyday woman.

Still though, Lacroix have done the same concept of fashion since he started. And there should not be a doubt whether or not he has clients. Furthermore, I believe he has more clients than McQueen or Balenciaga. He is a couture house afterall. And if not that, you when people talk of McQueen, they often just acknowledge his talent for design, and not for wearability, unlike Lacroix where many women actually his clothes. However, they're very "rich" women.

Perhaps it was the designer's (Lacroix himself) fault? But that would be blasphemous to say at this point.

 

[stateofbliss]

I really hope things work out for him. Do you think he'll branch out and come out with a line of shoes, bags, and/or accessories to appease his potential investors and bring in much needed revenue?

 

[mikeijames]

Furthermore, I believe he has more clients than McQueen or Balenciaga....

believe me he doesn't. balenciaga and mcqueen have very ardent cult followings that lacroix hasn't had since the nineties. also, there are legions of department store shoppers who shop for a balenciaga bag or a mcqueen shoe fairly regularly.

if this new deal goes through, they need to work on making lacroix into a brand that has appeal across all ages, economic statuses, and geographies.

 

[j'adore_couture]

Does anyone know what's likely to happen with this? Such bad news...

 

[Miss Mod]

The president of the company, Louis Petiet, didn't provide details on terms, but said if the deal happens, he plans to increase Lacroix's sales fivefold over the next five years. (The house hasn't been profitable in its 22-year history.) Petiet promised that the company would invest in a proper worldwide marketing and branding effort to ensure that happens.

the cut

I know this is mostly about re-working the brand, but I definitly think that expanding into accessories would make Lacroix more accessible. Perhaps the buyers see that as well? I suppose that takes away from couture house aspect of the company though. I hope the deal goes through, regardless of how the company is re-branded, because losing Lacroix couture would really be a shame.

 

[gius]

Next week decisive for future of Lacroix
By Dominique Schroeder (AFP) – 11 hours ago

PARIS — Next week will be decisive for the future of the Christian Lacroix fashion house, in administration since early June, as the deadline for potential buyers to submit their offers expires on Monday.
The court-appointed administrator Regis Valliot has received several expressions of interest in the label, including one from the consultancy group Bernard Krief Consulting (BKC), his office said.
Aside from BKC, two other potential buyers have shown an interest, "one of them a supplier," Guillaume Martin from the consultants Meric et Associes appointed by the Christian Lacroix works committee told AFP.
Created in 1987 with the backing of the global luxury leader LVMH, which sold the house to the US duty free giant Falic in 2005, the house of Lacroix made a loss of 10 million euros (14 million dollars) last year on sales of 30 million euros.
Under the company restructuring plan, 112 of its 125 employees will lose their jobs.
The works committee is scheduled to meet again on Tuesday afternoon.
At its last meeting on Wednesday, it heard the conclusions of the Meric consultancy group.
The experts recommended an upmarket ready-to-wear line instead of the existing luxury one to run alongside the house's haute couture. Collections should be timeless, less identifiable with any particular season, and distribution refocused on a limited number of markets.
"Haute couture loses money, it is the brand's advertising budget," Martin explained. "Unless you have products with a sound commercial success behind it, you will never absorb the cost and turn a profit on your creative investment."
He said costs at Lacroix had "run out of control" and needed to be cut "quite drastically" to bring down losses. In this scenario it would make sense to create an upmarket line.
The house should "not go off in all directions" but recapitalise on its strengths and the position it already holds in certain markets, he said.
He said the house could also appeal to the government for help given its contribution to France's cultural legacy and expressed surprise and disappointment that no other big luxury group, like LVMH's arch rival PPR which owns Gucci, Yves Saint Laurent and Balenciaga, or Hermes, had not shown any interest in taking over Lacroix.
The designer himself lunched on Friday with Culture Minister Frederic Mitterrand but nothing has leaked on what they discussed.
Mitterrand in early July expressed willingness to help find a solution for the couture house, saying its disappearance would be "a cultural disaster."
A member of the works committee said the employees were "rather fatalistic" about the situation.
"They aren't going to mobilise, that's not the way they do things," at Lacroix, which is not unionised, he explained. He added that they had "gained a month" because the redundancy letters should have gone out at the end of July.
"Now they will wait to receive their letters when they get back from their holidays, to tell them they haven't got a job to come back to."


Copyright © 2009 AFP. All rights reserved

 

[kiddokiddo]

How unsettling!!!

 

[dior_couture1245]

From fashionologie.com

Despite early reports last week of an offer on Christian Lacroix by Bernard Krief Consulting, the label's appointed judicial administrator ruledbid of less than a few million euros "insufficient." Two other offers of a symbolic euro were received by the deadline, but judged "inconsistent," so the forerunner appears to be Italian retailer Borletti, which has stakes in the Printemps and Rinascente department stores and which the administrator says has made "a serious offer."

Borletti envisions keeping 49 of the current 124 Lacroix employees and is said to be backed by Lacroix himself. But BKC is not stepping down yet, saying it plans to submit an "improved" offer, with the number of jobs retained "around the hundred." Lacroix himself met Friday with France's Culture Minister Frederic Mitterand and is meeting tomorrow with Industry Minister Christian Estrosi, as the French government is seeking to stimulate rescue interest after no other big luxury group like PPR, LVMH, or Hermes showed interest in investing.
Meanwhile, current Lacroix owner the Falic Group, has submitted its own plan for the house, and consultant Guillaume Martin, who is advising Lacroix, has suggested moving the brand away from couture and toward upscale ready-to-wear. A final decision is expected in September, with a six-month extension of administration likely to come tomorrow.

Well...this all sounds extremely promising! I'm not going to celebrate quite yet, but the fact that several investors are all making offers is wonderful news. I'm pulling for Bernard Krief!!!

 

[eternitygoddess]

who is advising Lacroix, has suggested moving the brand away from couture and toward upscale ready-to-wear.

OH HELL NO!

There's be no Lacroix with no Lacroix couture.

 

[Trista]

You said it best. I'll take no Lacroix over "upmarket ready-to-wear" with no couture.

 

[xFashionfollower]

This almost brought tears to my eyes. If LaCroix is going down it'd be like having an arm amputated.

 

[j'adore_couture]

This is quite a conundrum, isn't it? I really hope something good will come out of this!!

 

[Leeroi]

OH HELL NO!

There's be no Lacroix with no Lacroix couture.

The problem is that almost everyone who says they love Lacroix probably cannot afford to buy their actual clothing. More over, his "ready-to-wear" collections are more "couture" in terms of marketing and prices. Basic short dresses that cost around $5,000 - $15,000 (or even more) is a bit absurd for a ready-to-wear, even luxury brands like Versace, Armani, and Chanel don't sell ready-to-wear products at those prices, especially if the dresses are not designed for actual "every-day" wear. I hardly doubt that he'd stop making couture collections also, but it sure would help if his "ready-to-wear" collections were actually competitively priced, even if it means compromising on the actual designs.

 

[D A N A]

http://perezhilton.com/2009-07-28-christian-lacroix-gets-bailed-out

 

[mikeijames]

from vogue.co.uk

one inspiring item...

Lacroix "Enlivened", 29 July 2009
http://www.vogue.co.uk/news/daily/090729-christian-lacroix-talks-about-the-b.aspx

CHRISTIAN LACROIX is feeling "positive" today, following a bid tabled to save the designer's threatened couture house from extinction (read the full story here). The 58-year-old French designer says the interest in his business has given him renewed vigour.

"We have had an extremely positive conversation," Lacroix said following a meeting with Industry Minister Christian Estrosi yesterday - adding that he has been "enlivened" by the idea of continuing his business.

The bid, by the Italian-based Borletti Group, was made in association with the designer and Lacroix hinted that a revival package would see other aspects of the couture business develop too - including fragrance.

"The brand doesn't yet have the perfume it deserves," Lacroix told WWD.

Lauren Milligan

and another...

Last Chance Lacroix, 28 July 2009
http://www.vogue.co.uk/news/daily/090728-last-chance-lacroix.aspx

THE bids are on the table for the ultimate couture purchase, Christian Lacroix - the company not a dress - and administrators hope a saviour is among them. Yesterday was the deadline for offers for the couture house and the bids will be evaluated by a court in September to decide who will assume control of the ailing label.

In the running is the Italian Borletti Group, owner of department stores La Rinascente and Printemps, whose offer - in association with the designer himself - was being treated as "serious" by the administrators when it arrived at the last moment yesterday. Last week's bid by French turnaround firm Bernard Krief Consultants was deemed "unsatisfactory" by the administrators, WWD reported - and two bids of €1 each were also rejected.

The only other option for the company comes in the form of the current owners, US-based Falic Group, activating a restructuring plan. This option is not favoured by those within the label, however, since it would mean reducing the workforce by around 90 per cent and would see the 22-year-old couture house reduced to little more than a licensing operation.

Lauren Milligan