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Versace’s Latest Vision: Seeks Minority Investor On Road to Eventual IPO

Seven years after his death, Gianni Versace’s brother and sister are planning to make his dream of taking the company public a reality.

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MILAN — It was Gianni Versace’s goal to list his fashion company on the stock market, and now, seven years after his death, his brother and sister are planning to make that a reality.

In an exclusive interview, Daniele Ballestrazzi, Versace’s interim chief executive, said the company has appointed Lazard and Credit Suisse First Boston to find a minority investor with the eventual plan to take Versace public. The minority investment could come as early as this year. Although he said an initial public offering is at least three years away, Ballestrazzi sought to quell growing fears that Versace is spiraling into financial difficulty.

Ballestrazzi said it was only logical for the company to once again look at a stock market listing, a plan the family was pursuing until Gianni’s tragic death in 1997.

“This is one of the few legendary brands around,” Ballestrazzi said during an interview at the group’s headquarters here. “The time has come to resume the project.”

Ballestrazzi declined to specify how large a stake the Versace family is willing to sell, but earlier this month Santo Versace told the Italian newspaper Corriere della Sera that the company would be willing to sell as much as 25 percent to a fund.

Versace has declined to name potential investors, but has claimed that multiple parties have expressed an interest. U.S. Cerberus Capital Management L.P., one of whose funds bought Fila, is considered a possible candidate, but observers said it’s unlikely Cerberus would take a minority position in a company.

Such a move would radically alter the shareholding structure of the company and alter the balance of power among family members. Currently Santo, Gianni’s brother, owns 30 percent, while his sister, Donatella, owns 20 percent. Allegra Beck, Donatella’s daughter, inherited 50 percent of the company from her late uncle and will obtain full control over her stake when she turns 18 this summer.

Offering up a minority stake without full managerial control could be a tough sell, some in the market have said. But Ballestrazzi stressed that the minority shareholder will have a hand in selecting the company’s permanent ceo, as well as some strategic input to boot.
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