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Gucci’s New Surprise: CEO Santucci Said Preparing to Resign

Sources say Gucci brand chief executive officer Giacomo Santucci may have his eye on the door.

Giacomo Santucci

Giacomo Santucci

Photo By WWD Staff

MILAN — In what would be the second-biggest Gucci defection since Tom Ford and Domenico De Sole left last spring, sources say Gucci brand chief executive officer Giacomo Santucci may have his eye on the door.

Santucci is a well-respected manager and one of the few top executives to stay at the company after the departure of

De Sole and Ford from the firm they turned around.

He and Yves Saint Laurent ceo Mark Lee are seen as a vital bridge between the old De Sole regime and the new Pinault-Printemps-Redoute era.

A PPR spokesman declined to comment Monday on relations with Santucci or the reports that he may be about to step down. Santucci could not be reached directly, but a Gucci spokeswoman said that both Santucci and Gucci Group as a whole decline to comment on rumors as company policy.

Three sources have said that tensions between PPR and Santucci have reached a boiling point. Two of those people said that Santucci is at odds with PPR’s “massified” approach to growing the brand.

Another contributing factor, according to a source, is Santucci’s contract. The source said it is well-known within Gucci that Santucci’s contract expired last fall and its renewal got lost amid the turmoil of the negotiations with De Sole and Ford. PPR is said to recently have offered to renew Santucci’s contract on the same terms as his old one, which he is said to have turned down. Talks over the contract renewal reached an impasse and now have turned into discussions over his resignation.

Santucci joined Gucci in January 2001, earning a reputation as a De Sole disciple. The industry considered him one of several potential candidates PPR could promote to the group ceo slot to replace an outgoing De Sole.

Prior to joining Gucci, Santucci spent eight years at Prada, helping to develop the cosmetics and eyewear businesses, reorganizing operations in Asia and working closely with acquired brands like Helmut Lang. The industry has considered Santucci and Lee all the more valuable to Gucci since PPR appointed Robert Polet, a former Unilever executive with no past luxury goods experience, as Gucci Group’s ceo.

One source close to Santucci said the Italian manager has come under heat recently for sales and profitability figures that PPR deemed unacceptable for a cash cow brand that needs to help compensate for money-losing acquisitions in a turnaround phase. These acquisitions include brands like Yves Saint Laurent, Bottega Veneta, Stella McCartney, Boucheron, Alexander McQueen and Sergio Rossi.
“In [PPR’s] mind it is easier to grow the profits and revenue where they already exist rather than growing revenue and reducing losses at the smaller brands,” said the source.

The most recent set of Gucci results available are second-quarter figures PPR released in September. They show a 17.5 percent jump in the Gucci division’s earnings before interest and taxes to 102.9 million euros and sales growth of 8.6 percent to 392.8 million euros. At current exchange rates, those figures are equivalent to $128.3 million and $489.8 million.

If he resigns, Santucci will join a long list of defections from Gucci. In May, Gian Giacomo Ferraris left his position as Gucci’s director of worldwide apparel operations to become the ceo of Jil Sander AG. Brian Blake, former head of Gucci’s watch division and jeweler Boucheron, left prior to De Sole’s departure and subsequently joined Burberry as president and chief operating officer. Other departing executives include Robert Singer, Gucci Group’s chief financial officer, who left in May to become president and chief operating officer of Abercrombie & Fitch; Toshiaki Tashiro, president of Gucci Japan, and communications directors Lisa Schiek and Tomaso Galli.