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| Mittal daughter-in-law snaps up ailing Escada |
| Press Trust Of India / London Nov 07, 2009, 00:35 IST |
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Her father-in-law built a global steel empire relying solely on this strength and now Megha Mittal displayed the same predatory skills with her bid for insolvent European fashion house Escada.
Mittal today confirmed winning Escada, which filed for bankruptcy, in an auction in Munich.
"Our first priority is to ensure that the great heritage of this iconic company is translated into a strong and successful future," she said in a statement.
Megha's father-in-law Lakshmi Mittal built his steel business by taking over run-down steel mills and reviving them. His first such acquisition was a plant in Indonesia.
"Despite recent difficulties, Escada has the potential to re-define its place in the world of luxury brands and become synonymous with fine quality and elegance," said Megha, 33, who married Aditya Mittal, her classmate at Wharton Business School.
Escada is a favourite among Hollywood celebrities including Katie Holmes and Hillary Swank, but had fallen on bad times after years of poor sales.
"The insolvency administrator of Escada AG has signed a sale and transfer agreement with one of the Mittal Family Trusts," Escada said, adding that the preliminary creditors' committee has approved the transaction.
Megha Mittal supported the current CEO of Escada and said, "I am confident that under the leadership of Bruno Salzer, we have the right team to achieve this."
Under the agreement, Escada AG's business operations, including employees as well as worldwide brand rights, production facilities and the sales and distribution structure to the Mittal Family Trusts.
The statement added that "with the execution of the agreement all key assets of Escada AG's operative business as well as shares in Escada AG's subsidiaries will be transferred to the Trust." However, subsidiaries, which serve as guarantor for the Escada bond would be excluded from the said agreement.
"I am relieved. Uncertainty for our staff, clients and suppliers is ended. With the Mittal family we have found an excellent partner. Now we can focus on the future," board President Bruno Saelzer said.
According to reports, Megha Mittal plans to turn Escada into an affordable fashion brand, offering more day-wear rather than the glamorous evening gowns it was once known for.
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