Dec 1, 2009
French court backs crisis plan for Lacroix
Dec 1, 2009
PARIS, Dec 1, 2009 (AFP) - A French court on Tuesday 1 December approved drastic cutbacks for the fashion house Christian Lacroix, which will lose nearly all its staff and shut its main clothes designing activities.
Photo: AFP/Pierre Verdy
The Paris bankruptcy court approved the plan, which will end production of the classic label's haute couture and ready-to-wear lines after potential buyers passed up a deadline to take over the company.
The prestigious label was in notable absence at Paris fashion shows in October after it was forced to file for bankruptcy, hit hard by a widespread economic slump.
The plan passed on Tuesday 1 December will see 100 staff cut with just 11 remaining to manage the company's licences for other products, including men's clothes, wedding dresses and perfumes.
"The court rejected all the plans that were proposed by the different buyers and retained the plan to continue the company that was proposed by the current shareholders," the company's lawyer Simon Tahar said.
It "rejected the idea of a liquidation that would have closed the company for good."
The fashion designer Christian Lacroix who founded the company declined to comment to AFP on the decision. Speaking last week, he had expressed concern for the "hands of gold" of his designers who would lose their jobs.
"It's unreal," said one employee of the company, Monika Soszynska, on the sidelines of the hearing. "We can't believe we're going to stop."
Another employee who declined to be named said the ruling marked the end of Lacroix as a house of high fashion. "All kinds of products will now be able to get made under Mr Lacroix's name," she said.
The fashion house was founded in 1987 with the backing of the world's leading luxury giant LVMH Moet Hennessey Louis Vuitton, which sold it in 2005 to the US duty-free giant Falic.
It ran up losses of 10 million euros (about 15 million dollars) in 2008 for sales of 30 million euros and later filed for bankruptcy, hit by the sharp downturn of the luxury market.
Sheikh Hassan Ben Ali al-Naimi, who is close to the ruling family of the Ajman emirate, stepped in with an offer of 100 million euros in September when another potential buyer pulled out, but was unable to come up with the financial guarantees to back his proposal.
The chief executive of the Christian Lacroix company, Nicolas Topiol, said Tuesday 1 December's ruling would give the company "a chance to re-launch" with a focus on ready-to-wear garments.
He said he hoped to "find a solution" to rescue the company and that the Sheikh may yet play a role.
Makers of high-end products were not spared by the economic crisis that has caused factory shut-downs and massive job-cuts worldwide over the past year.
French luxury giant LVMH was hit by falling sales of champagne, jewellery and cosmetics in recent quarters compared with last year, but has said business began picking up in the second half of 2009.by Gersende Rambourg
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