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LVMH's Berluti to hire designer Haider Ackermann-sources
July 29, 2016 / 11:36 AM / a year ago

LVMH's Berluti to hire designer Haider Ackermann-sources

PARIS, July 29 (Reuters) - Berluti, LVMH’s lossmaking luxury shoe maker, is in talks to hire Paris-based designer Haider Ackermann to replace Alessandro Sartori who returned to previous employer Ermenegildo Zegna in February, two sources close to the matter told Reuters.

Ackermann, a respected figure in the fashion industry known for his super-imposed layers, draping and dark style, will be expected to give Berluti a sharper, more modern fashion edge.

“The talks are ongoing, therefore the timing of an announcement is not clear yet,” one of the sources said.

Ackermann created his eponymous brand in 2003, which is only distributed through wholesalers and online retailers.

LVMH declined to comment, as did a spokeswoman for Haider Ackermann.

Created in 1895 and specialising in 1,500-euro ($1,667) luxury shoes with a peculiar two-tone shine and finish, Berluti has been trying to re-invent itself as an upmarket ready-to-wear brand.

Analysts estimate Berluti burned 100-150 million euros since LVMH stepped up investments five years ago and LVMH boss and controlling shareholder Bernard Arnault placed his son Antoine at its helm.

Back in 2011, LVMH had grand ambitions for Berluti which it aimed to use it as a platform to gain more exposure to what was then a vigorous luxury menswear market, driven by strong Chinese demand.

In the past two years, however, the luxury sector has slowed sharply and Chinese men’s appetite for luxury shoes and clothes has become much more subdued.

Berluti opened flagships in every major city and invested in its website. Today, it has more than 50 stand-alone stores and is estimated to incur around 50 million euros of losses on a turnover of around 150 million euros ($166.68 million).

Back in 2013, Bernard Arnault said he expected Berluti to become profitable in 2016.

Berluti is regarded by the financial community as one of LVMH’s problem children together with Marc Jacobs but for different reasons. Last year, LVMH announced it would discontinue the Marc by Marc Jacobs line which was more affordable than the Marc Jacobs line and the restructuring dug holes in the company’s accounts.

LVMH said this week it did not plan to sell the lossmaking Marc Jacobs company after agreeing to sell Donna Karan International, the parent of New York label DKNY, to U.S. clothing firm G-III Apparel Group for $650 million.

LVMH said Berluti’s losses had narrowed in the first half but it did not say when it expected it to become profitable. ($1 = 0.8999 euros) (Reporting by Astrid Wendlandt; Editing by Adrian Croft)

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