LONDON - Prada, the Milan-based luxury goods group, is believed to have pencilled in a May flotation in a move that will inflame its power struggle with rivals LVMH, Gucci and Pinault Printemps Redoute.
A source close to Prada named May as the preferred date for the share offering, but
executives were keeping close tabs on the volatile markets.
Prada chairman Patrizio Bertelli said last year that the company would list between 25 per cent and 30 per cent of the business – which could be worth up to $14 billion – on the Milanese stock exchange.
The funds raised from the offering would be used for acquisitions and to develop new businesses, Mr Bertelli has said. Some may also go towards paying off debt accumulated after a recent buying spree.
The offering will intensify Prada's rivalry with its competitors. The company has a 9.5 per cent stake in Gucci, having initially bought 5.05 per cent in 1998.
It has also taken control of Helmut Lang, Jil Sander and shoemaker Church's. In addition, Prada has an equal stake – with LVMH – in a joint venture that controls 51 per cent of Rome-based fashion house Fendi, outmanoeuvring Gucci during a bidding war last year.
Meanwhile, rival entrepreneurs Bernard Arnault, chairman of LVMH, and François Pinault of PPR are currently waging a bitter struggle to gain control of Gucci.
On Friday, PPR, which has a 42 per cent stake in the company, said it would appeal against a decision by the Enterprise Chamber of the Amsterdam Court of Appeals to launch an inquiry into PPR's strategic alliance with Gucci.
The original Prada boutique, selling high-quality leather goods, opened in 1913. By the 1970s, competitors such as Gucci and Hermès had forced the company into near bankruptcy.
But in 1978, the founder's granddaughter, Miuccia Prada, who is married to Patrizio Bertelli, took control of the floundering business. Mr Bertelli now concentrates on management while Miuccia designs the collections.
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