WWD

PHOTO BY SILJA MAGG; STYLED BY ALEX BADIA

By EVAN CLARK

AVON PRODUCTS INC.’S aggressive efforts to break into the Chinese direct-to-consumer market led it, on Tuesday, to plead guilty in a Manhattan criminal court and penalties of $135 million.

That’s not to mention the roughly $350 million the company has spent investigating the matter — a years-long saga that illustrates the drive of companies to push the envelope as they try to break into new markets.

Avon pleaded guilty and agreed to pay $68 million in fi nes to the Justice Department. It also will pay an-other $67 million in disgorgement and prejudgment interest, tied to the company’s record keeping and payable to the Securities and Exchange Commission and. The SEC matter is still subject to approval by the Manhattan federal court.

The SEC alleged that Avon made $8 million worth of payments in cash, gifts, travel and entertainment to “gain access to Chinese offi cials implementing and overseeing direct selling regulations in China.”

Improper payments were made to avoid fi nes or negative news articles that could have tarnished Avon’s clean corporate image, which was required to retain the license that allowed it to sell in China, the SEC said.

The payments included paid travel for Chinese of-fi cials as well as gifts of Louis Vuitton merchandise, Gucci bags, Tiffany pens and corporate box tickets to the China Open tennis tournament.

Doling out gifts to offi cials has long been a com-mon practice for Western companies working in

By LUISA ZARGANI

MILAN — The euro may have trumped the ruble in the Roberto Cavalli group sale.

In a surprising turn of events, Cavalli now is in talks to sell a signifi cant majority stake to Italian private eq-uity fi rm Clessidra SGR SpA for an undisclosed sum. The Florence-based designer had been in negotiations for months with the Russian fi rm VTB Capital, with a deal initially expected to close last fall.

Sources said Clessidra could buy up to 90 per-cent of the fashion house. Upon completion of a deal, Francesco Trapani would become president of the Cavalli company, while the designer would remain a shareholder and help the new team develop the brand. The deal is expected to be fi nalized in the fi rst quarter of 2015. Financial details were not disclosed, but the VTB deal valued Cavalli at more than $1 billion.

This is not the fi rst time Clessidra has looked at the Cavalli dossier. A deal to sell a 30 percent stake to the equity fi rm broke down in 2009 over the value of the fashion brand. Over the past year, Permira and later VTB Capital, part of Russian investment bank VTB Group, were engaged in negotiations with Cavalli, but those deals never materialized.

Trapani, executive vice chairman of Clessidra, joined the equity fi rm as a shareholder and operating partner in April with the aim of helping boost invest-ments in the fashion and jewelry industry. He left his position as chairman of LVMH Moët Hennessy Louis Vuitton’s watches and jewelry division a month earli-er. The executive assumed that role in 2011 when the French luxury conglomerate acquired Bulgari, where he had been chief executive offi cer. He remains a member of the LVMH board and adviser to chairman Bernard Arnault on the group’s activities.

Trapani is the great-grandson of Bulgari founder Sotirio Bulgari. He helped transform Bulgari, which he joined in 1981, from a small jewelry company into

SEE PAGE 6

MAY SELL A MAJORITY

Cavalli Changes Course:Talking With Clessidra

Avon to Pay $135MIn Corruption Case

SEE PAGE 8

Ath-leisure has been the overriding trend in

men’s wear for the past couple of seasons and activewear brands are

jumping on the opportunity, launching performance

pieces that work as well on the streets as they

do at the gym. Leading the way is compression

apparel, where guys mix tight-fi tting leggings and shirts, technical

outerwear and designer sweatshirts. For more

on the compression obsession, see pages

MW2 and MW3.

THURSDAY, DECEMBER 18, 2014 ■ $3.00 ■ WOMEN’S WEAR DAILY

WWD■ WOMEN’S WEAR DAILY

Squeeze PlayNeil Barrett’s

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PRE-FALL 2015

THE LATEST LOOKS FROM

ROLAND MOURET, BCBG MAX AZRIA, SHOSHANNA AND

MORE. PAGE 4

NEW MAN

HUDSON’S BAY CO. NAMES GERALD STORCH CHIEF EXECUTIVE

OFFICER. PAGE 2

MAKING HIS MARK

SHISEIDO PRESIDENT AND CHIEF EXECUTIVE

MASAHIKO UOTANI AIMS FOR SALES OF

$8.5 BILLION BY 2020. PAGE 8

May Sell a Majority

WWD.COM2 WWD THURSDAY, DECEMBER 18, 2014

By DAVID MOIN

HUDSON’S BAY CO., seeking to accelerate growth on several fronts, has brought in Gerald “Jerry” Storch as its new chief executive officer.

Richard Baker, who held the ceo job, will con-tinue as governor and executive chairman of HBC, with Storch reporting to him. Baker and Storch will comprise the offi ce of the chairman.

In another top-level shift, Don Watros, who was president of the company, has become president of the group’s new international unit to identify and launch international businesses and operate them, though no possibilities were disclosed Wednesday.

International growth could involve an acquisi-tion or furthering Saks Fifth Avenue’s overseas presence. “We are really not ready to have any dis-cussion about international,” Baker told WWD.

Starting Jan. 6, Storch will be responsible for Hudson’s Bay, Lord & Taylor, Saks Fifth Avenue, Saks Off 5th, Home Outfi tters and HBC Digital. Now the heads of HBC’s divisions, including Marigay McKee of Saks Fifth Avenue, Liz Rodbell of Lord & Taylor and Jonathan Greller at Saks Off 5th will report di-rectly to Storch instead of Baker and Watros.

With Storch on board, Baker will be freed up to concentrate more on in-ternational expansion, ac-quisitions and real estate, and less on day-to-day op-erational activities now in the hands of Storch.

“Having Jerry as the ceo gives me some addi-tional time to focus on the three core activities that I generally like to focus on — the international op-portunity, our real estate opportunities, and poten-tial mergers and acquisi-tions,” Baker said. “I still will be involved in partic-ipating and understand-ing the operations of our existing businesses and how we invest our capi-tal. Jerry and I will be partners in all endeavors of the Hudson’s Bay Co.”

With the exception of three licensed Saks Fifth Avenue stores — two in the Middle East and one in Kazakhstan — HBC’s stores operate in North America. Saks also has two licensed stores in Mexico.

“We live in a growing, dy-namic global society,” Baker added. “There are opportu-nities outside the U.S. and Canada to create value.”

The Neiman Marcus Group is already aware of that. Last fall, NMG bought mytheresa.com, an up-scale online business based in Munich, Germany which also has one store, in Munich, thrusting Neiman’s into the international arena in a big way. Baker could be considering a similar dot.com move, or a brick-and-mortar deal. He has been eye-ing Neiman’s for some time, though an acquisition couldn’t happen soon since the luxury retailer was purchased by Ares Management LLC and Canada Pension Plan Investment Board just last year.

On the home front, Baker has been pushing the expansion of the Saks Off 5th outlet chain; the dot.com businesses at Lord & Taylor and Hudson’s Bay department stores, which are relatively new com-pared to the more advanced saks.com; synergies and cost savings; investments in top-performing doors such as the Saks and Lord & Taylor fl agships in Manhattan, and unlocking value with HBC’s real estate holdings. In November, HBC completed a $1.25 billion, 20-year mortgage on the ground por-tion of the Saks fl agship on Fifth Avenue to reduce debt and strengthen the balance sheet. The company said the fl agship was appraised at $3.7 billion. HBC purchased Saks last year for $2.9 billion, including debt. Baker is also considering a spin-off of his HBC properties into a real estate investment trust.

In the third quarter, the $7 billion HBC nar-rowed its loss to 13 million Canadian dollars, or $11.4 million, in the quarter from 125 million Canadian, or $109.2 million, in the 2013 period. Earnings before interest, taxes, depreciation and amortization, on a normalized basis, rose to 116 million Canadian dollars, or $101 million, com-pared to 63 million Canadian dollars, or $55 mil-lion a year ago.

Same-store sales during the quarter at the de-partment store group increased 1.7 percent. Saks’ same-store sales rose 1 percent. Saks Off 5th saw same-store sales increase 19.2 percent. Lord & Taylor was a drag on sales at the department store group, but Storch said that at the group, “I believe that the team has done a great job. There are al-ways strong points and less strong areas. If you look at the results, they’re pretty good. There are many additional opportunities. One of the greatest is to continue to expand the digital business by building up the omnichannel paradigm.”

Storch said that the department store format, “once given up as an old-fashioned business, is

now cutting edge” due to the rise of omnichan-nel services and initia-tives. Going forward, Storch said he sees HBC “strengthening the con-nection between our store and digital busi-nesses, expanding the outlet channel and invest-ing in the store base” as key strategies.

Storch started his 30-plus-year career as a college student working in the bargain basement of a May Department Stores Co. location in Jacksonville, Fla., selling men’s and women’s shoes. “You really learn retail when you sell women’s shoes,” he said.

For the last two years, he has been chair-man and ceo of Storch Advisors. Before that, he was chairman and ceo of Toys ‘R’ Us from 2006 to 2013, which he grew into a $13 billion global retailer and ex-panded the company’s e-commerce to more than $1 billion, according to HBC. He also drove growth in China and other parts of the world and led the acquisitions of FAO Schwarz, eToys and KB Toys. However, late in his tenure there, a slumping toy sector led to aborted plans for an initial public offering.

Earlier, Storch was vice chairman of Target, where he started target.

com, Target’s grocery business and oversaw Target Financial Services credit card business. He also oversaw Marshall Field’s, which was sold to May Co. under his watch, and led Target’s corporate strategy function for more than a decade. Before Target, he was a principal at McKinsey & Co.

For the past year, Storch, on a consulting basis, has been working with Baker on growing Saks Off 5th, geographically and in terms of merchandise pre-sentation. HBC executives see much room for growth at Off 5th, which at about $500 million in sales is one quarter the size of the Nordstrom Rack outlet chain.

“Jerry brings to us tremendous capabilities on both the operating front and the digital frontier as well as being a world-class strategist and being responsible for many rollouts and developments at Toys ‘R’ Us and Target over the years,” Baker said. “The opportunity to have Jerry work with us is a big win. I have spent a tremendous amount of time over the last year working with Jerry. When we acquired Saks, we brought Jerry and his consulting team in to help us reposition Saks Off 5th over the last year. There’s been fantastic growth in the business.

“I’m particularly impressed with his ability to work with the team, coach the team and create a plan to execute,” Baker said.

’’

’’

HBC Names Storch CEO

ON WWD.COM

THE BRIEFING BOXIN TODAY’S WWD

In a surprising turn of events, Cavalli now is in talks to sell a signifi cant majority stake to Italian private equity fi rm Clessidra SGR SpA for an undisclosed sum. PAGE 1

For better or worse, several fashion and retail chief executives landed on an annual “worst ceo” and “best ceo” list developed by Sydney Finkelstein. PAGE 3

There’s the CFDA, and there’s CFDA+, the latter an initiative to help identify top fashion graduates and connect them with American fashion houses. PAGE 3

Marc Balet, Bonnie Pressman and Alex Dulac have teamed up to launch the editorially focused lingerie Web site OuiHours with e-commerce to follow Jan. 1. PAGE 5

Donna Karan is opening a 2,500-square-foot Urban Zen pop-up boutique in Aspen on Monday that will remain open through mid-April. PAGE 5

Pierre Bergé marked the 10th anniversary of the Pierre Bergé-Yves Saint Laurent Foundation with a bespoke book distributed to friends and supporters of the house. PAGE 6

Shiseido Co. Ltd. has outlined its new strategic plan to target sales of 1 trillion yen, or $8.5 billion, in 2020 as it pursues M&A opportunities and introduces new brands. PAGE 8

It’s no longer your grandfather’s remedy for edema. Compression apparel has now moved well beyond the medical arena to take the fashion scene by storm. PAGE MW1

Heisman Trophy winner and Hawaii native Marcus Mariota may be the country’s most promising quarterback, but his sartorial style is far from a touchdown. PAGE MW4

31-year-old Angeleno Spencer Nikosey talks his brand KillSpencer, 24-karat gold basketball kits, and how graffi ti inspired the curious name for his label. PAGE MW4

Jade Jagger and Kate Moss in London. For more, see WWD.com.

JADE JAGGER PARTY: Jade Jagger hosted a Christmas cocktail party in London on Tuesday night. For more, see WWD.com.

PHOT

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TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS FIRSTNAME_LASTNAME@FAIRCHILDFASHION.COM, USING THE INDIVIDUAL’S NAME. WWD IS A REGISTERED TRADEMARK OF FAIRCHILD PUBLISHING, LLC. COPYRIGHT ©2014 FAIRCHILD PUBLISHING, LLC. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A. VOLUME 208, NO. 125. THURSDAY, DECEMBER 18, 2014. WWD (ISSN 0149-5380) is published daily (except Saturdays, Sundays and holidays, with one additional issue in March, April, May, June, August, October, November and December, and two additional issues in February and September) by Fairchild Media, LLC, which is a division of Penske Business Media, LLC. PRINCIPAL OFFICE: 11175 Santa Monica Blvd., 9th Fl, Los Angeles, CA 90025. Periodicals postage paid at Los Angeles, CA, and at additional mailing offi ces. Canada Post: return undeliverable Canadian addresses to P.O. Box 503, RPO West Beaver Cre, Rich-Hill, ON L4B 4R6. POSTMASTER: SEND ADDRESS CHANGES TO WOMEN’S WEAR DAILY, P.O. Box 6356, Harlan, IA, 51593. FOR SUBSCRIPTIONS, ADDRESS CHANGES, ADJUSTMENTS, OR BACK ISSUE INQUIRIES: Please write to WWD, P.O. Box 6356, Harlan, IA, 51593, call 866-401-7801, or e-mail customer service at wwdPrint@cdsfulfi llment.com. Please include both new and old addresses as printed on most recent label. For New York Hand Delivery Service address changes or inquiries, please contact Mitchell’s NY at 1-800-662-2275, option 7. Subscribers: If the Post Offi ce alerts us that your magazine is undeliverable, we have no further obligation unless we receive a corrected address within one year. If during your subscription term or up to one year after the magazine becomes undeliverable, you are ever dissatisfi ed with your subscription, let us know. You will receive a full refund on all unmailed issues. First copy of new subscription will be mailed within four weeks after receipt of order. We reserve the right to change the number of issues contained in a subscription term and/or the way the product is delivered. Address all editorial, business, and production correspondence to WOMEN’S WEAR DAILY, 750 Third Avenue, New York, NY 10017. For permissions requests, please call 212-630-5656 or fax request to 212-630-5883. For reprints, please e-mail FFM_Reprints@pmc.com or call Wright’s Media 877-652-5295. For reuse permissions, please e-mail FFM_Contenlicensing@pmc.com or call 800-897-8666. Visit us online at www.wwd.com. To subscribe to other Fairchild Media, LLC magazines on the World Wide Web, visit www.wwd.com/subscriptions. WOMEN’S WEAR DAILY IS NOT RESPONSIBLE FOR THE RETURN OR LOSS OF, OR FOR DAMAGE OR ANY OTHER INJURY TO, UNSOLICITED MANUSCRIPTS, UNSOLICITED ART WORK (INCLUDING, BUT NOT LIMITED TO, DRAWINGS, PHOTOGRAPHS, AND TRANSPARENCIES), OR ANY OTHER UNSOLICITED MATERIALS. THOSE SUBMITTING MANUSCRIPTS, PHOTOGRAPHS, ART WORK, OR OTHER MATERIALS FOR CONSIDERATION SHOULD NOT SEND ORIGINALS, UNLESS SPECIFICALLY REQUESTED TO DO SO BY WOMEN’S WEAR DAILY IN WRITING. MANUSCRIPTS, PHOTOGRAPHS, AND OTHER MATERIALS SUBMITTED MUST BE ACCOMPANIED BY A SELF-ADDRESSED STAMPED ENVELOPE.

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Jerry and I will be partners in all

endeavors of the Hudson’s Bay Co.

— RICHARD BAKER, HUDSON’S BAY CO.

Gerald “Jerry” Storch

Jade Jagger and Kate Moss

Photo by Tim Jenkins

WWD.COM3WWD thursday, december 18, 2014

By Lisa Lockwood

EddiE and dov were among the worst, and Jack and kevin were among the best — chief executive officers, that is.

Eddie Lampert, chairman and ceo of sears Holdings, and dov charney, who was ousted on Tuesday as ceo of american apparel, were among this year’s five worst ceos on the annual list developed by sydney Finkelstein, the steven Roth Professor of Management, faculty director of the center for Leadership and associate dean for ex-ecutive education at the Tuck school of Business at dartmouth. Jack Ma, ceo of alibaba, and kevin Plank, ceo of Under armour, scored spots on the list of the best ceos. There are 10 executives in total (five best and five worst).

“when i was looking at the list, it is remarkable how many retail companies end up on this list,” said Finkelstein in an interview on wednesday. “it’s really a hard industry. Brands come and go, and staying on top is hard [and] growing is hard, and then you add in the trans-formation that’s going on to online and digital and discounting — it’s a very dy-namic, challenging industry.”

in addition, Finkelstein observed a strong entrepreneurial element to

the fashion and retail businesses. “Entrepreneurs can create some amaz-ing things, but they also can come crash-ing down to earth pretty fast,” said Finkelstein, who wrote the book “Think again: why Good Leaders Make Bad decisions and How to keep it From Happening to You.” He added, “They have a greater tendency to not listen to others because they’re the ones who built the company themselves.”

For the past five years, Finkelstein has published a list of the worst ceos. Last year, he added the best ceos to the list, recognizing leaders based on com-pany performance and the relationship between that company’s success and the ceo’s strategy and leadership. The list also takes into account ceos’ biggest gaffes and those who are running compa-nies with significant financial struggles.

Here are Finkelstein’s picks for the worst ceos of 2014:5. dick costolo, Twitter: Finkelstein said the social-media site’s shares have dropped by 42 percent, and the number of monthly active users has slowed. in Finkelstein’s opinion, Twitter is not ful-

filling its huge potential and is growing more slowly, with more question marks under costolo.4. Eddie Lampert, sears Holdings: Finkelstein noted that sears continues to log half-billion-dollar quarterly loss-es. The educator cited “Lampert’s failed strategy, arrogant leadership and sears’ rapidly falling stock price” as reasons for Lampert’s placement on the worst ceo list. This is the second year that Lampert has been named to the list.

“He’s an incredibly smart guy and a big success in the hedge-fund business but not a success as a ceo,” Finkelstein told wwd. “it’s another example of how he’s experimenting and trying a lot of things, but he’s not focusing on the core, which is a brand that’s totally broken and…seems like your grandmother’s brand....anytime he comes up with a scheme to sell off real estate, the market reacts positively.”3. Philip clarke, Tesco (with an honor-able mention for Terry Leahy, his pre-decessor as ceo): Finkelstein called it a “disastrous” year for Tesco. clarke was fired on July 21, after yet another profit warning, and the U.k.’s largest food retailer subsequently revealed ac-counting irregularities. Finkelstein said the company’s U.s. venture, Fresh & Easy, was longtime ceo Leahy’s mistake,

which cost the company $2.7 billion; the business eventually was shuttered. “However, clarke took one year to close a business that continued to hemorrhage money,” said Finkelstein.2. dov charney, american apparel: Finkelstein cited several company scandals, alleged financial misconduct and numerous lawsuits filed against american apparel and charney. He also mentioned american apparel’s stock price, which is down 80 percent in five years. in June, charney was ousted as chairman and suspended as president and ceo for alleged misconduct and vio-lations of company policy. as the board investigated, he worked as a consultant. on Tuesday, he was finally fired and re-placed as ceo by Paula schneider, who has held senior roles at warnaco, BcBG Max azria and Laundry by shelli segal.1. Ricardo Espírito santo silva salgado, Banco Espírito santo: Finkelstein se-lected him as the worst ceo of the year because he brought Portugal’s second-biggest bank into bankruptcy. Finkelstein noted that, during the first half of 2014, BEs experienced a loss of $4.5 billion.

Finkelstein cited allegations of fraud; complicated, intertwining ownership stakes among family-controlled enter-prises and the fact that Portugal was forced to bail out BEs with $6 billion.

Here are Finkelstein’s picks for the best ceos of 2014:5. andrew wilson, Electronic arts, a marketer and distributor of video games: Finkelstein noted that, in 2012 and 2013, the company was named the “worst company in america” by consumerist, a consumer publication. Today, its stock price is up 96 percent, which Finkelstein called “incredible.”4. John Martin, Gilead sciences: Martin “successfully brought sovaldi [a drug that helps to cure hepatitis c] to market and embraced a pricing strategy that de-livered significant value to investors,” said Finkelstein.3. Jack Ma, alibaba: alibaba’s initial public offering, which raised $25 billion in september, was the largest iPo in his-tory; since then, the company has grown its stock price an additional 12 percent. Finkelstein credits Ma “with alibaba’s significant growth — its total revenue grew by 53.7 percent to $2.74 million in 2014, with mobile revenue growing by more than 1,000 percent.”

“This is the first big chinese com-pany that has entered the big leagues in

america, with Facebook, amazon, eBay and Google and all the rest. and he’s big-ger than amazon and maybe bigger than eBay and amazon, together. when they write the business history books about this era, there will be a lot to say about this guy,” said Finkelstein. 2. kevin Plank, Under armour: Under armour’s stock price increased 58 percent after an 80 percent gain last year. “Under armour has now had four straight quarters of over 30 percent growth and 18 straight quarters of over 20 percent growth. nike is on alert,” said Finkelstein. “He’s killing it. He could have been number one. The stock price has been booming. He’s moved from a niche apparel company to building on that — footwear, international and a good effort toward women.” 1. Elon Musk, Tesla and spaceX: Musk led two companies on big growth trajec-tories. Finkelstein noted that, in addi-tion to Tesla’s stock price increasing 38 percent year to date after rising 344 per-cent in 2013, spaceX made several suc-cessful trips to space and won important government contracts.

CFDA+ Initiative Adds International

From the Top Down: The Head Honchos

The BesT CeO’s OF 2014 …

… AnD The WOrsT

By MaRc kaRiMZadEH

nEw YoRk — There’s the cFda, and there’s cFda+, the latter an initiative to help identify top fashion graduates and con-nect them with american fashion houses.

The program quietly launched on a domestic level last year, but this year, the council of Fashion designers of america added an international dimension by in-cluding colleges from around the globe.

The idea for cFda+ was born in 2013, when the organization worked with Boston consulting Group and identified four areas — fashion week, manufactur-ing, corporate partnerships and educa-tion — to focus on.

“Education was one that the board was particularly articulate about, wanting the cFda to help identify top talent,” cFda chief executive officer steven kolb said. “in creating cFda+, it’s a bridge to the most employable graduates.”

kolb compared this process to “pre-screen or prefilter” before the actual hir-ing process, information to which cFda members have exclusive access before the organization goes wide with it.

This year, the program began by in-cluding colleges beyond north america.

“we went international to attract tal-ent to the United states, which is not to say there isn’t great talent at american schools,” kolb noted. “But the world is global and for us, to be able to connect talent that wants to come to new York to american designers strengthens american fashion.”

The vetting process started at the cFda, which worked directly with par-ticipating schools, including Parsons The new school for design, Pratt institute and san Francisco’s academy of art University, as well as London’s Royal college of art, Manchester’s University of salford and shenkar college in israel.

This was followed by another round of industry professionals — among them ex-ecutives from houses such as diane von Furstenberg, Marc Jacobs and alexander wang — vetting the work, whittling the final list down to 71 graduates receiving cFda+ status. of those, 31 were from U.s. schools, while 40 were international.

The process is not just about the stu-dents’ portfolios. it also takes character, a fresh perspective on traditional codes and trend awareness into consideration, among other things.

The cFda partnered with arts Thread to showcase the work of cFda+ design-ers on artsthread.com. cFda members had exclusive access to this for 30 days before they were made available to other design companies earlier this month.

“The cFda+ program was born from our designers’ need to hire the top talent in order to remain leaders in this indus-try,” cFda president von Furstenberg said. “The global expansion of cFda+ allows us to recognize an even-greater group of prom-ising emerging professionals who have the diverse specializations and skill sets which are desired by the cFda members.”

douglas MacLennan, the design school director at northumbria University in newcastle upon Tyne in the U.k., noted: “in the current working climate, our graduates currently seek to work worldwide, rather than just nationally, and all interest shown in their work within increasingly competi-tive market forces is seen as a positive move for both the university and the graduates.”

Meg decubellis, apparel design de-partment head at Risd in Providence, added that undergraduates and young de-signers “benefit from mentorship, schol-arship support and networking oppor-tunities that cFda+ provides. students are challenged to think on a professional level and are critiqued by industry pro-fessionals long before they are in the fast-paced world of fashion. creating this safe environment to learn and grow enables Risd students the opportunity to explore and find their voice.”

5

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Dick Costolo, Twitter

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WWD thursday, december 18, 20144

Roland Mouret: For the second time, Roland Mouret staged a small runway show at his grand London headquarters to introduce pre-fall — and he gave his lineup an arty twist this season. “It’s a buy-now, wear-now collection that needs to be desirable in every possible kind of weather — in a cold autumn, a warm winter,” said the designer. “The pastels clash with autumn colors, the fabrics are breathable, and eveningwear is fluid.”

Colorblocking was key, as in a black-and-white dress with flat, origami-like pleating at the front and wide-legged, pea-green trousers worn with a blush-colored trench. Monochrome was another theme, seen in a fluid red jumpsuit with wide legs and a pea-green skirt suit with a cropped jacket.

Mouret also favored magnified plaids — including one in rust and bright blue

— for coats and dresses and embellished the front of pencil skirts with laser-cut dots and flowers. Shiny strips of silver fabric on liquid kimono tops and gowns added a dash of flash to this ultra-sleek collection.

— SAMANTHA CONTI

Ohne Titel: Designers Alexa Adams and Flora Gill drew inspiration for the many variations on stripes in their pre-fall lineup from Jimmy Nelson’s photography book “Before They Pass Away.” African tribal textiles were reimagined into short, A-line knit skirts, tops and dresses in unexpected color combinations such as olive green with ultramarine blue and fuchsia with orange. “The bright colors do very well for us in places like Miami and Brazil, but we also worked on a more fall palette, such as the olives and blues,” Adams said.

Non-striped pieces were

shown monochromatically, as in an all-white look of trousers paired with a buttoned-up shirt under a knit tank top, or color-blocked so that “everything pretty much goes with everything,” Gill added.

— MAYTE ALLENDE

Alexander Lewis: London-based Alexander Lewis conjured up a subversive femininity for pre-fall, drawing on the idea of a complex Middle Eastern woman. Lewis imagined her as having “spent time on a kibbutz” then traveling in Mexico and on the Inca Trail before eventually “falling in love with a wealthy man in New York or London.”

That narrative translated into silhouettes that both concealed and revealed the body: a goldenrod, velvet maxiskirt paired with a long-sleeved, black velvet top that showed a sliver of midriff; a simple shift dress in a diaphanous red tulle embroidered with sequins resembling pomegranate seeds. “She’s pushing the boundaries when she can,” the designer said.

Lewis also wove symbols from the Jewish and Islamic worlds into pieces, such as a skirt done in a blue and silver jacquard inspired by the Star of David and a black sweater with the hand of Fatima embroidered in sequins. Bold, new-age amethyst and crystal jewelry, in collaboration with Californian jewelers Alex & Lee, nodded to South American influences in this eclectic lineup.

— NINA JONES

Hervé Léger by Max Azria: Evoking African heritage by way of vibrant colorways and abstract fruit prints, Lubov and Max Azria updated their signature bandage dresses with new textural plays such as patchwork and lattice detailing, hand-woven fringe, eyelet hardware and iridescent beading. Patterned stripes on zip-up jackets, bra tops and dresses gave the looks sporty appeal.

— KRISTI GARCED

BCBG Max Azria: Inspired by the art and architecture of Barcelona — and particularly the surrealist work of Spanish Catalan artist Joan Miró —

Lubov Azria worked lingerie detailing into a series of floaty, printed bohemian dresses and pleated skirts with sheer lace insets. That romanticism was offset by more structured, men’s wear-inspired separates and belted military jackets — including a fresh take on culottes — while leather appliqués, feathers and beading in an earthy palette lent jackets and tops a rich, exotic feel.

— K.G.

Shoshanna: Shoshanna Gruss found herself in a Mediterranean state of mind for pre-fall. She captured the mood with colorful floral-print tops and dresses, geometric beading on the necklines of floaty silk styles and embroidery in varying shades of blue, which lent the lineup a bit of a Moroccan feel. Fringe details continue to be a hit for the brand, and Gruss’ looks — a matching crop top and wrap skirt in powder blue, also done in a black satin version for evening — offered a flirty take on the trend.

— K.G.

Pre-Fall 2015

For more Pre-FALL 2015, see

WWD.com/runway.

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WWD.COM5

ASPEN ADDITION: Donna Karan is opening an Urban Zen pop-up boutique in Aspen on Monday. The 2,500-square-foot store, which will be open through mid-April, is located at 501 East Dean Street, in the retail area of The Residences at The Little Nell and within walking distance to Aspen Mountain’s Silver Queen Gondola.

The ski resort is dear to Karan. “I’ve spent endless holidays there with my family and have so many friends who live there,” she said. “My new Urban Zen store is my way of dressing and addressing a community that’s given me so much love and enjoyment — in the same way as my West Village and Sag Harbor stores.”

Alongside women’s and men’s apparel and leather goods, jewelry, home decor and art, there is an exclusive collection called Silver Snow, which focuses on white, gray and silver and features cashmere sweaters, sweatpants and leggings, as well as suede, shearling and down pieces. It is priced from $995 and $5,995. —MARC KARIMZADEH

BURBERRY’S TWITTER TURN: Burberry is using Twitter to help get some last minute sales in the days leading up to Christmas. Starting this week, Burberry sales associates will respond to holiday

shopping inquiries, providing personalized gift suggestions via Twitter. The 24-hour service is available to any Twitter user who tweets a question containing the hashtag #burberrygifts. Associates will respond to tweets with direct links to purchase. Burberry was the first luxury brand to use Twitter’s Buy button in September, allowing users to purchase exclusive nail polish colors from the spring 2015 runway show. The brand began to sell fragrance on the social platform soon after.

— RACHEL STRUGATZ

SPECIAL SCREENING: Diane von Furstenberg is making a stop in Los Angeles en route to her Christmas vacation. The reason? On Sunday night, she will

be feting the “House of DVF” season finale, which crowns the E! Network reality show’s winner and next DVF brand ambassador, as well as her just-opened shop at The Grove. The night will start with a celebration at the boutique, followed by a VIP viewing of the finale at the retail complex’s Pacific Theatres and a Q&A with the designer.

The Grove unit is one of several in Southern California. Von Furstenberg also has stores on Melrose Avenue, as well as in Santa Monica, Glendale, and at South Coast Plaza in Costa Mesa.

— MARC KARIMZADEH

WWD Thursday, december 18, 2014

By ROSEMARY FEITELBERG

VISITORS TO OuiHours’ cavernous SoHo offices can’t help but look around at the Warholian artwork, hand-carved furniture and a wall covered with hundreds of snap-shots, many of which were taken in the wee hours of the night.

The power of photography, and imagery as a whole, is something that cofounder Marc Balet first grasped working for Andy Warhol as Interview magazine’s creative director. OuiHours’ head merchant Bonnie Pressman needed no con-vincing, having helped to visualize a more irrev-erent Manhattan during her tenure at Barneys New York and, more recently, as an in-the-know consultant. The duo, along with president and chief executive officer Alex Dulac, have launched the editorially focused lingerie Web site OuiHours with e-commerce to follow Jan. 1.

Intent on appealing to confident, fashion-minded women with a certain amount of in-souciance, OuiHours is counting on big-name photographers to further that cause. During a recent interview alongside Pressman and Dulac in their eclectic lower Broadway office space, Balet said friends like Bruce Weber, Patrick Demarchelier, Albert Watson and

David LaChapelle (whom he gave his first job to) “have been rallying around to help and are doing so for very, very little money.” Sante D’Orazio, Luis Sanchez and Paul Westlake already have shot spreads for the site, while Charlotte Rutherford, Steve Hiett and Arthur Elgort are among those on deck. Another sig-nificant get is filmmaker Federico Fellini’s grand nephew Gianluca who has shot three videos for OuiHours, including one of a lin-gerie-clad model baking bread in her father’s bakery in Rimini and another of her cruising the streets of Paris in the back of a limo.

The launch of OuiHours is timely, Pressman said, given the fact that most fashion maga-zines no longer spotlight lingerie in editorial shoots as often as they once did. The Web site aims to have 300,000 to 400,000 unique monthly visitors by the end of 2015, according to Dulac.

In the 35 years since Balet, a Rome Prize winner, made his way to Warhol’s Factory, (thanks to an introduction by Fran Lebowitz, whom he befriended after meeting her in Rome 35 years ago), he has cultivated his own follow-ing for delivering razor-sharp marketing ad-vice. He helped launch Nike Goddess and has advised La Perla, Express, Warnaco and other brands. After realizing that “no one was really talking about lingerie in a sophisticated way, either online or off,” Balet said he finessed the concept over several years, whereas developing the site was an eight-month endeavor.

OuiHours offers 138 products from 60 brands, including Stella McCartney, What Kate Did, Cosabella and Commando. Its on-line magazine, which will be updated every two to three weeks, has a pop quiz with Halle Berry and a feature about Debi Mazar’s vin-tage lingerie collection. Susanne Bartsch and Kelly Bensimon were among the first to open their lingerie drawers for #OpenDrawer.

Along with having a presence on Instagram, Twitter, Pinterest, Polyvore and Tumblr, OuiHours is building its image via YouTube with original video footage, editorial stories, how-to’s and intimate interviews. And a Jan. 1 launch is set for OuiHours radio on Spotify, essentially playlists of what designers, artists and DJs listen to in their own wee hours.

Balet said some of OuiHours’ story ideas stemmed from just rounding up a group of friends, plying them with a little wine and talk-ing about lingerie. Beyond the standard photo shoots featured on the site, online fashion vid-eos and audio recordings of select interviews will be added in coming months. “It’s inherently made for social media. A lot of customers are spending all of their days on Instagram and the various platforms,” Dulac said. “While we have all this great content on the site, we can also go to where they hang out every day. It’s also a lifestyle brand — the ‘wee hours’ is something we have all enjoyed and that lifestyle aspect is something that we can connect with.”

Pressman, in turn, has been highlighting a lot of brands that shoppers might not otherwise see. “It’s about curation and having a point of view, which I learned very much from being at Barneys for all those years,” she said, noting she is all too aware of the barrage of ads and infor-

mation shoppers face. “Given the imagery [of the site], the engage-ment and the aspiration it will give to the consumer, I think it will just build. If you go on linge-rie sites, it’s all catalogue-driven. It’s boring. You can see product, but it’s boring. This gives it an-other dimension, another life.”

Balet sees OuiHours as the new alternative. “People just fall back to the usual suspects,” he said. “We’re trying to say, ‘Look, there’s a world of ingenuity, tal-ent and creativity that we’re try-ing to showcase.’ Basically, that’s what the magazine is about.”

In an effort to stand apart, OuiHours has collaborated with Victoria Bartlett and Curriculum Vitae, with Cadolle and Cynthia Rowley set for upcoming ones. “So as Marc is reaching out to photog-

raphers for favors, I’m doing the same thing with merchandising,” Pressman said.

The brand does plan to develop its own label by fall 2015. Freestanding stores will follow, with 2016 as a target date. OuiHours purchases also will be shipped in a signature box that has a pat-terned interior and opens as a bureau drawer would. And there also is a section on the site de-signed for brides. “There are 2.2 million couples that get married every year and no one is doing a great job of talking to the bride,” Dulac said.

“OuiHours really has a playful seductive quality to it and that’s what this is about,” Balet said. “Seduction with the magazine, with the product. If you’re seductive in a business meet-ing with your choice of lingerie or seductive with your boyfriend or girlfriend, then you’re seductive, so the OuiHours is really a mind-set. It’s not eight o’clock at night ’til 3:30 in the morning. It’s a bigger idea than that really.”

Warhol, of course, understood the punch of a powerful image. “He obviously was a huge influence in my life,” Balet noted. “He was a genius about marketing. To this day, when I’m in meetings I think of Andy as a reference. We also did Interview with very little money and made it look like a million. That’s kind of what we’re doing also at OuiHours. Editorially, I’m referring to that to make it really beautiful, ex-tremely entertaining and visually exciting to motivate the consumer to come in and shop.”

Alongside the lingerie offerings, OuiHours shoppers will find Robert Piguet’s Fracas fra-grance and Luz de la Riva’s black lace mask among other items. Artist Judyth van Ameringe also has created an assortment of nests de-signed for shoppers to stow away their jewelry. “That’s a very extreme one,” said Balet, motion-ing toward a neon orange design with a minia-ture flashlight. “But we want to offer gifts for women and for men to give to women that they haven’t seen before.”

TPG Buys Beautycounter Stake

OuiHours’ Intimate E-commerce Stance

For more scoops, see

WWD.com.

Fashion scoops

The Web site aims to have 300,000 to 400,000 unique monthly visitors.

By ARNOLD J. KARR

TPG GROWTH HAS acquired a mi-nority stake in Beautycounter, the Santa Monica, Calif.-based personal care and beauty products marketer that relies principally on e-com-merce and independent consultants to bring its “safe” beauty and per-sonal care products to consumers.

Terms of the transaction weren’t disclosed. However, Gregg Renfrew, Beautycounter’s founder and chief executive officer, told WWD in October that it expected to close a Series B round of financing of about $10 million to $15 million this fall.

The company, founded in March 2013, expects to use the funds to accelerate its growth, including investments in infrastructure and continuing to develop, produce and sell high-performance beau-ty products made without 1,500 harmful ingredients, contained in its “Never List,” linked to cancer, hormone disruption, reproductive toxicity and other health risks.

While essentially a direct-to-con-sumer enterprise, the firm has mar-keted its products through J. Crew and the Web site Goop.com and has operated two pop-up shops, in the Los Angeles and Dallas markets, through its relationship with Goop.

“We’ll continue the relation-ship with Goop and might do ad-ditional pop-up shops and even some stand-alone beauty counters on our own,” Renfrew said, adding that distribution outside the U.S., probably beginning in Canada, is being explored as well.

While the company didn’t di-vulge sales figures, Renfrew noted that sales have increased six-fold since January and the number of consultants now exceeds 5,000. Market sources said the company

is projected to exceed $50 million in sales in the coming year.

“Beautycounter’s growing custom-er base demonstrates that cosmetics and personal-care products can be ef-fective while maintaining higher in-gredient standards,” said John Bailey, partner at TPG Growth. “Gregg and her team of passionate, knowledge-able consultants are well on their way toward reshaping the category.”

Bailey will be added to Beautycounter’s board.

This is TPG Growth’s second visit to the beauty sector. It acquired a majority stake in E.l.f. Cosmetics from the company’s founders and TSG Consumer Partners LLC in February for an undisclosed amount, although industry esti-mates said the company was likely to sell for $200 million or more.

TPG has about $65 billion of assets under management and its TPG Growth unit accounts for about $3.9 billion of that amount. In addition to E.l.f., TPG holds a con-trolling stake in J. Crew Group and equity interests in such controver-sial and market-disruptive firms as Uber and Airbnb. Warburg Pincus and TPG sold Neiman Marcus to Ares Management and the Canada Pension Plan Investment Board for about $6 billion last year.

Renfrew said that among the elements of Beautycounter’s cor-porate mission is elevating aware-ness of the risks involved with many conventional beauty prod-ucts, including those associated with some natural ingredients, such as heavy metals, and others that are banned in the E.U.

“Our goal is obviously to build a business that’s financially viable and successful for all involved, but there’s a strong social commitment here,” Renfrew said, “and that mission is at the core of all we do.”

WWD.COM6 WWD THURSDAY, DECEMBER 18, 2014

HANG TEN: Call it a couture tome. Pierre Bergé chose to mark the 10th anniversary of the Pierre Bergé-Yves Saint Laurent Foundation with a bespoke book distributed to friends and supporters of the house, each with a calligraphy dedication. Only 1,000 copies are to be printed, and it will not be commercialized.

Packed with archival photos and text by Patrick Mauriés and Dominique Baqué, the 246-page coffee-table book by Editions du Regard also shelters news. Following a list of the 22 exhibitions the foundation has hosted at its lavish headquarters on the Avenue Marceau — dedicated to painting, photography, art and decoration — are details of the next two showcases.

The late couturier’s controversial Forties collection from 1971, which catapulted a retro trend despite howls of protest from the press, is to get the spotlight from March 19 to July 19 next year, curated by Olivier Saillard of Palais Galliera. This will be followed by an exhibition of art masterpieces collected by fashion designer Jacques Doucet, along with works purchased by Saint Laurent, showing how the two men were arbiters of taste in their respective eras. The latter is to debut in October.

Come 2016, the foundation is to focus solely on the fashion legacy of the acclaimed designer, and the following year, the venue is to become a permanent Yves Saint Laurent museum, Bergé told WWD.

The foundation certainly has riches to share, including 5,000 couture ensembles, including some from Saint Laurent’s brief career at Christian Dior; about 2,000 Rive Gauche ready-to-wear outfi ts; plus thousands of accessories, original drawings and other artifacts.

Bergé said that the institution’s inaugural exhibition, exploring how the designer’s clothes often paid tribute to the art world, was its most visited showcase. He also noted the foundation would organize exhibitions outside its walls, in France and abroad.

— MILES SOCHA

COMING BACK AGAIN: Vanity Fair said Wednesday that it would renew its New Establishment Summit next year. The Condé Nast-owned publication launched its inaugural New Establishment Summit two months ago at the Yerba Buena Center for the Arts in San Francisco. The two-day event featured speakers such as Michael Bloomberg, Shane Smith, Bob Iger and Elon Musk.

Although it did not provide a speaker list for 2015, Vanity Fair did confi rm that it would use the same venue for its summit, which will take place on Oct. 6 and 7. — ALEXANDRA STEIGRAD

LITERARY TYPES: Prada on Wednesday revealed the names of the members of the jury to select the winners of Prada Journal, the project dedicated to emerging writers that the fashion label launched last year in collaboration with Italian publishing company Giangiacomo Feltrinelli Editore. Indian poet, writer and dancer Tishani Doshi;

Carlo Feltrinelli, chief executive offi cer of Giangiacomo Feltrinelli Editore, as well as novelists Paolo Giordano and Colum McCann will unveil the winners of the contest’s second edition during an award ceremony in Milan on Jan. 19.

As was the case last year, when the event coincided with the launch of its new eyewear collection manufactured by Luxottica, Prada encouraged writers to send stories based on their own vision of the world.

For the fi rst edition, Prada received 1,300 entries from around the world. The best of them were collected in an e-book.

— ALESSANDRA TURRA

TRENDING UP: Hearst is upping the frequency of its free weekly magazine TrendingNY.

The newspaper-magazine hybrid aimed at Millennial women was launched in September and produced four issues. In 2015, Hearst is rolling out nine issues, with a new one distributed the fi rst week of each month from April to December. Hearst said it would ramp up TrendingNY’s frequency later in the year, and would continue to distribute the magazine in the New York metro area, including in key neighborhoods in Brooklyn and Queens.

According to Michael Clinton, president of marketing and publishing director of

Hearst magazines, TrendingNY will now feature heavier, glossier cover stock and its circulation will double to 100,000 copies an issue from the initial print run of 50,000.

The magazine will continue to feature fashion and beauty-centric content about in-store events and current happenings of the week of the publication. Hearst said that each magazine will be a minimum of 52 pages

and will continue to be edited by Emily Cronin, a former acting features editor at Harper’s Bazaar U.S. and contributing editor to Elle U.K.

The fi rst four pilot issues of TrendingNY featured advertisers such as Banana Republic, Bloomingdale’s, Estée Lauder and Macy’s.

“With every pilot, we ask for reader feedback so we can tweak as we go,” said Hearst Magazines editorial director Ellen Levine. “Young women

responded to its bold, happy, vibrant look and newsy information on trends, and felt the fast format was original and refreshing, which was our goal from the start.”

James D’Adamo, group advertising director in Hearst’s corporate sales and marketing group, will head up the business side. TrendingNY is designed in partnership with New York design company Priest + Grace. — A.S.

a leading group with a turnover of 1 bil-lion euros, or $124 billion at current ex-change rate. Trapani was instrumental, more than a decade ago, in buying and integrating top suppliers such as Gérald Genta and Daniel Roth, and the labels’ production facilities, Manufacture de Haute Horlogerie SA, which has allowed Bulgari to produce watches entirely in-house. Trapani also spearheaded Bulgari’s expansion in fragrances, the brand’s hotel venture and investments in handbags and accessories, tapping Matthew Williamson to design capsule collections in that category, for example. He then helped complete the integration of the jewelry fi rm within LVMH.

Last year, Clessidra bought a 70 per-cent stake in Milanese jewelry firm Buccellati. In September, Buccellati tapped Gianluca Brozzetti as its new ceo. Brozzetti held the same position at Cavalli, which he left in January. In

October, Clessidra fi nalized an agree-ment to take a 35 percent stake in Harmont & Blaine SpA, which will be used to support the sportswear brand’s growth around the world and strengthen its managerial structure.

Market sources speculate that a Cavalli deal with Clessidra could re-sult in a new designer being brought in to help the brand. The industry’s musi-cal chairs have seen Marco Zanini leave Schiaparelli in November and Guillaume Henry join Nina Ricci from Carven, where Alexis Martial, creative direc-tor of Iceberg’s women’s wear line, is rumored to be headed. Last week, news of the exit of Frida Giannini from Gucci, due in February, stirred a swirl of ru-mors around potential successors. Peter Dundas, a veteran of Cavalli and Emilio Pucci’s artistic director since 2008, was identifi ed by sources as a possible con-tender for Gucci, but the designer often has been mentioned as a possible can-didate for Cavalli over the past year during the sales negotiations. His sexy and feminine designs are in synch with Cavalli’s own sensibilities and style, making him an ideal candidate, accord-ing to several market sources.

Last month, when talks between Cavalli and VTB Capital hit a bump, a wistful Cavalli expressed concerns to WWD about his future and that of his brand, noting that it had “been diffi cult to understand the real intentions of these strange buyers,” referring to the Russian bank. “I have grand projects in mind — this is also the reason that pushes me to wait, to be confi dent of a sure thing with sure partners,” concluded Cavalli.

After WWD broke the news of the negotiations with VTB in August, the deal was expected to be completed in mid-October but was then pushed back to November. As reported, the Italian designer had signed a letter of intent to sell a 60 percent stake in his company to VTB, with the eventual goal of launching an initial public offering in four to fi ve years, according to sources.

Sources say VTB struggled to secure the necessary funds, hurt by the interna-

tional sanctions on Moscow for its role in the Ukraine crisis. It also may have been impacted by the resulting devaluation of the ruble and the weakening Russian economy, which has only gotten worse as global oil prices have nosedived. VTB Group was understood to be act-

ing for a Cyprus-based fund. The price tag was pegged at 500 million euros, or $624 million at current exchange. The deal valued the Cavalli brand at 830 mil-lion euros, or $1.03 billion. This amount represents four times the fi rm’s sales in 2013 and more than 22 times its earnings before interest, taxes, depreciation and amortization last year.

In 2013, the Florence-based fi rm re-ported sales of 201 million euros, or $265.3 million at average exchange, up 9.3 per-cent compared with the previous year. Net profi t last year dropped to 159,000 euros, or $209,880 at average exchange, from 359,000 euros, or $459,520, in 2012. EBITDA last year totaled 22.4 million euros, or $29.5 million. The company has not reported re-sults for the fi rst half of 2014.

At the end of 2012, the company had 179 stores, of which 90 were under the designer’s signature brand. Of these, 44 are directly owned, including Cavalli’s prestigious Rue du Faubourg Saint-Honoré boutique.

The value of the company has been a thorny issue for years, and the designer is said to have backed out of previous negotiations over price. The deal to sell a 30 percent stake to Clessidra broke down in 2009 for that reason. At the time, sources said Cavalli was looking to sell for 1 billion euros, or $1.25 billion. Talks with Permira cooled earlier this year, possibly triggering the sudden departure in January of the-then ceo Brozzetti and chief operating offi cer Carlo Di Biagio.

In 2006, Cavalli seemed close to a deal with Saudi Arabian private equity fund SAB Capital, which submitted a bid for 60 percent of his business, but the designer pulled out of the talks. During that round of negotiations, Permira was willing to pay 450 million euros, or $561.5 million, for the group, sources said — a price tag Cavalli rejected. Permira recently made an offer for the entire company, but an agreement was never reached because VTB outbid the Italian fund. Bahrain-based Investcorp, the former owner of Gucci and Saks Fifth Avenue, also was said to be looking at Cavalli in the latest round of sale negotiations.

Roberto Cavalli in Talks With Clessidra

TrendingNY will feature heavier, glossier cover stock.

MEMO PAD

{Continued from page one}

By LUISA ZARGANI

MILAN — The euro may have trumped the ruble in the Roberto Cavalli group sale.

In a surprising turn of events, Cavalli now is in talks to sell a signifi cant majority stake to Italian private eq-uity fi rm Clessidra SGR SpA for an undisclosed sum. The Florence-based designer had been in negotiations for months with the Russian fi rm VTB Capital, with a deal initially expected to close last fall.

Sources said Clessidra could buy up to 90 per-cent of the fashion house. Upon completion of a deal, Francesco Trapani would become president of the Cavalli company, while the designer would remain a shareholder and help the new team develop the brand. The deal is expected to be fi nalized in the fi rst quarter of 2015. Financial details were not disclosed, but the VTB deal valued Cavalli at more than $1 billion.

This is not the fi rst time Clessidra has looked at the Cavalli dossier. A deal to sell a 30 percent stake to the equity fi rm broke down in 2009 over the value of the fashion brand. Over the past year, Permira and later VTB Capital, part of Russian investment bank VTB Group, were engaged in negotiations with Cavalli, but those deals never materialized.

Trapani, executive vice chairman of Clessidra, joined the equity fi rm as a shareholder and operating partner in April with the aim of helping boost invest-ments in the fashion and jewelry industry. He left his position as chairman of LVMH Moët Hennessy Louis Vuitton’s watches and jewelry division a month earli-er. The executive assumed that role in 2011 when the French luxury conglomerate acquired Bulgari, where he had been chief executive offi cer. He remains a member of the LVMH board and adviser to chairman Bernard Arnault on the group’s activities.

Trapani is the great-grandson of Bulgari founder Sotirio Bulgari. He helped transform Bulgari, which he joined in 1981, from a small jewelry company into

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Roberto Cavalli

A spring 2015 look on the runway.

COLLECTIONS

Clothes make the man. We tell their stories.

Spring 2015 Issue

The access to industry intelligence, the inspiration for style–fashion culture begins here.

WWD.COM8

By KELLY WETHERILLE

TOKYO — Shiseido Co. Ltd. has out-lined its new strategic plan and said it is targeting sales of 1 trillion yen, or $8.5 billion, in fiscal 2020 as it pursues M&A opportunities and in-troduces new brands.

Japan’s largest beauty company also said it will work to strengthen its e-commerce and travel retail businesses and ramp up its research and development investments, while trying to lessen Shiseido’s “Japan-centric” orientation. Shiseido post-ed full-year sales of 762 billion yen, or $7.6 billion at average exchange, for the year ended March 31.

The new plan is the brainchild of Shiseido president and chief execu-tive Masahiko Uotani, who took the company’s reins earlier this year. His posting was signifi cant in that he is the company’s fi rst top execu-tive to be appointed from outside, rather than promoted from within. At a briefi ng on his new strategy Wednesday afternoon, he said he plans to hire even more outside staff, as well as to do away with the company’s long-standing “seniority system” in order to motivate young-er workers and reward them for leadership and other capabilities.

While Uotani said he plans to re-duce personnel costs by just over 5 percent by 2020, he said this will not be achieved by a large number of lay-offs. While he admitted there is likely to be some “streamlining” within the company, the focus will be on improv-ing labor productivity per capita.

As personnel costs are driven

down, Uotani plans to increase Shiseido’s investment in marketing costs, with the goal of strengthening its brand value and increasing market share. He said marketing investments will be increased by at least 100 bil-lion yen, or $853.49 million, a year for the three years starting from 2015.

“If you ask customers in Japan, I think they’ll say something like, ‘Shiseido is a wonderful company;

it’s great; I like it. But I don’t buy Shiseido-brand products,’” Uotani said. “[So] we must invest in order to create greater brand value.”

Uotani’s strategy is divided into two stages, the fi rst running from 2015 through 2017 and the second from 2018 through 2020. The fi rst stage will focus on reforms and re-inforcement, such as consolidating the company’s portfolio of around 120 brands by eliminating 28 small, unprofi table ones. Uotani said the company has not yet made a fi nal de-cision on exactly which brands these will be, but stressed that they will be

very minor ones. Shiseido will also strengthen its business in China and elsewhere in Asia, as well as its travel retail and e-commerce activi-ties in order to achieve a compound annual growth rate of 3 to 5 percent.

The second stage of the plan will focus more on the development and introduction of new brands; M&A activities — although Uotani did not specify what types of companies he may target for this, and entering into new markets. During this period, Shiseido expects to see sales growth of 5 to 7 percent. The company is tar-geting an operating profi t of at least 100 billion yen, or $853.49 million, in 2020. That would be more than dou-ble the operating profi t for the year ended March 31, which totaled 49.64 billion yen, or $423.71 million.

Uotani said that despite hav-ing a presence in many markets around the world, Shiseido has until

now been too Japan-centric, which makes it ineffi cient when respond-ing to customers’ needs.

“I’ve been to China many times, and if you ask staff there, they say that the Chinese market changes very quickly and dynamically,” Uotani said. “And so they tell us, ‘We want you to make this kind of product,’ and we bring that to Japan, where the people in charge have meetings about it and it takes months and years to decide whether or not to make that product, by which time [the needs of Chinese customers] have already changed.”

In order to address these inef-fi ciencies, Uotani plans to establish regional headquarters in each of Shiseido’s major geographic areas of operation. These offi ces will be in charge of functions such as mar-keting and fi nance, and will work to develop and promote products that cater to the local region. The com-pany’s global headquarters in Tokyo will be scaled down to support stra-tegic functions of the regional offi ces.

Uotani also acknowledged that Shiseido is often seen as a company whose products appeal more to a slightly older customer, which must change in order for it to achieve longevity. He said the company will begin to focus on increasing mar-ket share among young customers, while also continuing to support se-niors, particularly in its home mar-ket of Japan, where the population is rapidly aging.

By KRISTI ELLIS

WASHINGTON — Retail apparel prices fell in November, driven by across-the-board declines in women’s and men’s categories, according to the Labor Department’s Consumer Price Index, re-leased on Wednesday.

Women’s apparel prices fell a seasonally adjust-ed 1.7 percent in November, while men’s apparel prices declined .1 percent. Boys’ and girls’ apparel prices fell 1.5 and 3.4 percent, respectively.

“Without wage growth, there is really not a lot of demand for acceleration in apparel prices,” said James Bohnaker, an economist at Moody’s Analytics. “In addition, producers are benefi ting from lower oil and production prices, and there is not a lot of impetus to raise prices when demand isn’t really signaling they have room to do so.”

Bohnaker noted that he expects apparel prices to remain weak next year.

“Certainly, there is room for growth down the road, but I think retailers would like to see more demand before increasing prices,” he added.

In the women’s category, outerwear prices fell 3.7 percent in November, while suits and separates prices fell 2.4 percent. Prices in the combined un-

derwear, nightwear, sportswear and accessories category fell 1.9 percent. Women’s dress prices rose .4 percent.

In men’s wear, prices in the combined suits, sport coats and outerwear category fell 1.2 percent, while prices for shirts and sweaters fell .8 percent. Men’s wear prices for furnishings fell .5 percent, while prices for pants and shorts rose 1.7 percent.

The overall CPI fell a seasonally adjusted .3 percent last month, after falling .2 percent in October. Core retail prices, excluding volatile food and energy prices, edged up .1 percent in November.

“Retailers were discounting deeply and hard this November,” said Chris J. Christopher Jr., U.S. economist at IHS Global Insight. Consumer goods prices, excluding food and energy, fell a whopping .4 percent. In addition, many retailers are passing on their reduced transportation costs to consum-ers, he observed.

Christopher also noted that consumers are ben-efi ting from a “dramatic drop” in gas prices, which fell 6.6 percent in November, marking the biggest decline since December 2008.

“The plunge in prices at the pump is offering relief to lower- and middle-income households and mitigating the elevated level of food prices,” Christopher said.

China. Luxury fashion goods have been a popular currency, so much so that the corruption crackdown by Chinese President Xi Jinping has impacted sales of luxury brands in China, par-ticularly watches.

Avon’s efforts appear to have paid off since the beauty fi rm received the fi rst-ever direct-selling business license in China in March 2006.

The Justice Department added that Avon China attempted to disguise the payments by falsely describing their na-ture, falsely identifying who participated and falsely recording the expenses as payments to a third party for legitimate consulting services.

“Companies that cook their books to hide improper payments will face criminal pen-alties, as Avon China’s guilty plea demon-

strates,” said Assistant Attorney General Leslie Caldwell of the Justice Department’s Criminal Division. “Public companies that discover bribes paid to foreign offi cials, fail to stop them and cover them up do so at their own peril.”

Avon admitted that it learned of the practice at its Chinese subsidiary in 2005 and took steps to conceal the conduct. But a full-scale internal in-vestigation didn’t start until 2008, when then-chief executive offi cer Andrea Jung received a letter from a whis-tleblower. The scandal was one of the reasons for

Jung’s resignation as ceo in 2012, although she remained chair-man until the end of that year and an ad-viser to the fi rm until last April. She was succeeded as ceo by Sheri McCoy.

“Avon China was in the door-to-door in-fl uence-peddling busi-ness, and for years its

corporate parent, rather than putting an end to the practice, conspired to cover it up,” said Preet Bharara,

U.S. attorney for the Southern District of New York. “Avon has

now agreed to adopt rigorous internal controls and to the appointment of a monitor to ensure that reforms are insti-tuted and maintained.”

Avon also will work with a corporate compliance monitor, which can be re-placed after 18 months with self-moni-toring, and report obligations for another 18 months. The deal the court approved on Tuesday defers criminal prosecution of the company for three years.

The Foreign Corrupt Practices Act, which forbids U.S. companies from pay-ing bribes abroad, has stepped into the spotlight in recent years.

Wal-Mart Stores Inc. was said to have paid bribes in Mexico to ease its expan-sion. The retailer is also being investigat-ed by the SEC and the Justice Department. The company itself has looked into its op-erations in Brazil, India and China.

WWD THURSDAY, DECEMBER 18, 2014

Men’s, Women’sSee Steep Slump

Shiseido Moves Toward Expansion

Avon Nabbed for Improper Payments

’’’’

We must invest in order to create

greater brand value.— MASAHIKO UOTANI,

SHISEIDO

In the women’s category, outerwear prices fell 3.7 percent in November, while suits and separates prices fell 2.4 percent. Prices in the combined un-

derwear, nightwear, sportswear and accessories category fell 1.9 percent. Women’s dress prices

3.7%DECLINE IN WOMEN’S OUTERWEAR

PRICES FOR NOVEMBER

{Continued from page one}

Avon Nabbed for Improper Payments

Shiseido president and ceo Masahiko Uotani.

U.S. regulators alleged that Avon paid Chinese offi cials with cash and other gifts, including Louis Vuitton merchandise, Gucci bags and Tiffany pens.

IN THE SPOTLIGHT Accessories label Killspencer,

designed by Spencer Nikosey, is expanding to grow. Page MW4

A Duck Lays an EggHeisman Trophy winner Marcus

Mariota has a bright future, it’s time to raise his style game. Page MW4

MAN OF THE WEEK

December 18, 2014

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Tighten UpThe addition of geometric prints and novelty patterns has moved compression activewear even further into the fashion arena to become the go-to category for guys on the move.

Nike’s polyester jacket, polyester and spandex tank

top and Under Armour’s polyester and elastane tights.

Nike gloves and sneakers.polyester and elastane tights.

by JEAN E. PALMIERI

IT’S NO LONGER your grandfather’s rem-edy for edema. Compression apparel has now moved well beyond the medical arena to take the fashion scene by storm.

Tight-fitting socks, tights, shirts and sleeves, once the weapon of choice for a more-speedy recovery among endurance athletes, are now fi lling the shelves of sport-ing goods stores as fi tness enthusiasts as varied as triathletes and yogis embrace the ath-leisure movement. Now available in updated prints and patterns, compression apparel is as functional in the gym as it is fashionable in the café for post-workout protein smoothies.

“In the early days, it was much different,” said Fred Hernandez, director of marketing for 2XU. “Compression has a long history on the medical side to treat circulation issues and diabetes. But it’s come a long way.”

“It’s a necessary part of the system of dress for all athletes today,” said Glenn Silbert, vice president of men’s apparel for Under Armour.

Wearing compression apparel during and after a workout benefi ts competitive athletes as well as weekend warriors by cutting down on muscle vibration, improving circulation and reducing microtears and post-exercise soreness, Hernandez explained. As these at-tributes became better known to mainstream consumers, he added, compression apparel “translated down to everyday wear.

“The trend today is to have tighter-hug-ging apparel,” he said, pointing to Spanx and similar brands. “And that’s being ap-plied to athleticwear.” Couple that trend with the fact that women, in particular, are now wearing their yoga outfi ts and workout clothes to the supermarket and to the offi ce, and it leads to a “convergence of trends,” Hernandez said. “They want the benefi ts of compression as well as the fi gure-hugging look that is fashionable today.”

Men haven’t yet taken to replacing their suits with tights at the offi ce, but when they’re working out, they’re layering compression tights under basketball shorts and wearing skintight tops under a lightweight jacket. This look is also appropriate to wear out to lunch — fashionable without being too revealing.

Ned Munroe, chief design officer for Champion, said the brand offers two levels of compression apparel for men: a heavier style that is more fi tted to the body and a lighter-weight version that, while still pro-vides the benefi ts, allows for more move-ment and fl exibility. “There’s a big push in each area,” he said. “And it’s as strong in men’s as it is in women’s. The compression short in 9 or 11 inches is now a must and has taken the place of a jockstrap.” Although

ATH-LEISURE TREND

{Continued on page MW4}

Compression WearTightens Its HoldTight-fi tting apparel blends function with fashion.

Men’s WeekWWD THURSDAY, DECEMBER 18, 2014MW2 Men’s WeekMW2

Vibrant prints, reflective paneling details, aerodynamic silhouettes and the latest technology in microfiber are some of the features that have turned compression gear into a trendy fashion statement without compromising its high-performance sports benefits. — ALEX BADIA

PHOTOS BY SILJA MAGG

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ICNY’s cotton and polyester tank top, Rhone’s nylon and polyurethane shorts, Undefeated’s polyester and Lycra tights

and Ryu’s polyester jacket on waist. Alexander Wang backpack; Nike gloves;

Reebok sneakers.

Men’s WeekWWD THURSDAY, DECEMBER 18, 2014MW2 Men’s WeekMW2

Vibrant prints, reflective paneling details, aerodynamic silhouettes and the latest technology in microfiber are some of the features that have turned compression gear into a trendy fashion statement without compromising its high-performance sports benefits. — ALEX BADIA

PHOTOS BY SILJA MAGG

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ICNY’s cotton and polyester tank top, Rhone’s nylon and polyurethane shorts, Undefeated’s polyester and Lycra tights

and Ryu’s polyester jacket on waist. Alexander Wang backpack; Nike gloves;

Reebok sneakers.

Men’s Week WWD THURSDAY, DECEMBER 18, 2014 MW3Men’s Week

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Y-3’s polyamide jacket, Adidas Originals’ cotton

tank top. New Era cap.

2xu’s nylon and elastane shirt and

Porsche Design Sport by Adidas’ polyester and elastane tights.

2xu arm sleeve.

Undefeated’s nylon jacket and polyester and

Lycra tights.

Stone Island’s nylon jacket and Under Armour’s

polyester and elastane tights.

FOR MORE IMAGES, SEE

WWD.com/menswear-news.

the compression shorts are offered in solids and prints, they’re “defi -nitely the fi rst layer,” Munroe said. Champion’s Power Flex shorts have prints on the knee, so they can be worn under basketball shorts, and the brand also offers compres-sion Ts with the same prints.

The label further includes run-ning tights with refl ective taping for visibility — “That takes it to the second layer,” Munroe said — as well as long-sleeve shirts.

But for “someone older who doesn’t have a six-pack,” Champion offers slightly looser fi ts, some of which are for cold-weather training and use Duofold fabrics for warmth. “It’s a key volume driver for us,” Munroe said.

Under Armour built a $2 billion-plus business by bringing compres-sion apparel to the masses.

“Under Armour and compres-sion are synonymous,” said Silbert. “It was and continues to be the foundation of our business.”

The story is now well known. Under Armour founder and chief executive offi cer Kevin Plank, back when he played college football, had been searching for an alterna-tive to cotton T-shirts and, shortly after graduation, created tight-fi t-ting shirts that wicked away sweat and looked good on beefed-up play-ers. “It’s now evolved into a system of performance dressing on the fi eld, in the gym and on the road,” Silbert said. “When you wear com-pression, you feel powerful.”

Under Armour’s marketing ma-chine has helped to fuel that de-mand, using football players and other athletes in motivational print and broadcast ads that speak to the benefi ts of compression. But as other brands enter the space, Under Armour continues to innovate. Its newest offering is UA ClutchFit, which expands and contracts to the contours of the wearer. “Most fab-rics bind and bunch when you move, which causes restriction,” the com-pany said, while ClutchFit “opens up, expanding under pressure for freer athletic movement.” Other new features include compression with venting as well as stretch — Under Armour will offer under the Armour Stretch name a new proprietary fab-ric for spring that stretches and re-covers. “We took our base layer line and updated it for spring, so we can bring the benefi ts of compression with a stretch story,” said Silbert.

Beyond that, he noted that the company continues to see strength in tops and shorts, but leggings are now “phenomenal for us. They’re exploding across all genders and are a great layering look.” Under Armour also offers calf and arm sleeves that are popular with bas-ketball players.

2XU’s Hernandez gives credit to Under Armour and Nike for using their relationships with ath-letes to benefi t the entire industry. “If the basketball players are wear-ing it, pretty soon the kids will be, too,” he said. “Sports are now set-ting the trends for fashion.”

Compression also has crossed over into the lifestyle arena for Reebok. “It’s now entrenched in fi tness,” said Chris Gallo, senior director of CrossFit apparel glob-al product marketing. The brand has a good, better, best offering to address all price points and requirements. “It’s really taking off,” he said. “When it started, it was really big with kids, but now everyone from 22 to 50 is using it to get an edge and feel better.”He said the brand is “looking for different ways to tell the stories and market it.” To capitalize on the trend, the brand is now offer-ing a higher percentage of prints at the compression zones of its

garments. Tattoo-style prints on the arms or on the back of a shirt, for example, show movement and “fuse performance and lifestyle together.” And the same holds true for tights.

This ath-leisure trend has also expanded beyond U.S. borders.

“Our business is growing in compression, and it’s a global busi-ness for us,” Gallo said. “Europe and Asia are not as mature, so there’s great opportunity there.”

At 2XU, Hernandez said the brand’s offering in compres-sion has expanded dramati-cally over the past several years. “Five years ago, it was just socks and tights, and you’d wear them

underneath as a base layer,” he said. “Now, you’re wearing them as your primary layer.”Today, running shorts are integrat-ing compression liners, running tights are being designed to be worn alone, and socks are being worn all day long — some are tall and come up to the knee, while others stop at the ankle to com-press the feet. “Until three years ago, socks just came in black or white. We have them in over 20 col-ors now,” Hernandez said. “They’re fashion pieces. There’s a real con-vergence of fashion and sports. People are really appreciating the benefi ts for everyday use.”

He said the trend started with the explosion of brightly colored running shoes. “Five years ago, neons made a huge comeback,” he said. “And people wanted to match the rest of their outfi ts with their shoes. Now, you see neon-green running shoes with neon-green compression socks and tights with splashes of neon. Color is a real driver.”

Fashion brands are also em-bracing compression. Rhone, a new fi tness apparel brand that is sold at Bloomingdale’s, Paragon Sports and Equinox, will be adding compression shorts for spring to capitalize on the ath-leisure trend. “It’s clearly growing, and we’re seeing more demand,” said Ned Checketts, cofounder. Rhone also offers compression socks and other select pieces in its line. “Our core strategy is to layer up,” he said.

Men’s WeekWWD THURSDAY, DECEMBER 18, 2014MW4

{Continued from page MW1}

Man ofTHE WEEK

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The Heisman Trophy winner and Hawaii native may be the country’s most promising quarterback, but his sartorial style is far from a touchdown. He’s young and can be taught, though, so somebody has to get this kid a stylist.

The light-colored silk tie looks too bridal. He should swap it out for a darker tone but keep the repp stripe.

The suit is big everywhere, but it’s especially noticeable in the droopy shoulder. And with his V-shaped athletic physique, he needs a tapered waist. But as he is a fi rst-time o� ender and keeping in mind the spirit of the holiday season, we forgive him.

The excess fabric is overwhelming and really accentuates the ill fi t.

A chunky shoe just makes

things worse. A slimmer style

would improve the outfi t.

Remember: Just because it works

with your jeans doesn’t mean it

works with a suit.

If this is an Oregon Ducks pin, we’re all for it. Who doesn’t

like a little duck?

The hint of a white pocket

square is a good visual distraction.

The pants are also too

big, causing the crotch to

drop, which doesn’t help things at all.

The cropped cut and the sharp hairline

frame his forehead and balance his

strong jaw.

Compression Wear Increases Its Reach

NAME: KillspencerHISTORY: After graduating from the Art Center College of Design in Pasadena, Calif., Spencer Nikosey took his interest in graphic and industrial design and parlayed it into an accessories line that launched in 2009. The brand focused on waterproof backpacks, a style Nikosey had not seen in the market. After a successful run, the 31-year-old expanded to leather goods and accessories including some off-kilter sports-related items such as a boxing punching bag, football and, most recently, an indoor mini basketball kit made of 24-karat gold.WHAT’S IN THE NAME: “Ever since I was in college, I couldn’t fi nd a name for anything,” Nikosey said. “I was in class and out in the pavilion was a wall that said ‘KillSpencer’ in big, red graffi ti letters. The name was so powerful at the time and resonated with me. I didn’t know if it was an ex-girlfriend who’d written on a wall. It was a weird feeling, which is a cool part of it all, too.”KEY ITEMS: Weekender bags, backpacks, leather accessories, briefcases and sporting goods, including leather basketballs, footballs, punching bags, baseballs and soccer balls. Nikosey wanted to venture into sporting goods because of his interest in sports.

The basketball kit, he said, is indicative of the craftsmanship that can be done with leather. “It’s hard to make,” he said. “We spent seven months and fi nally fi gured out how to begin infl ating the ball, which we infl ate through a small air

hole.” Each is fully functional, he said.BUSINESS PLAN: Nikosey has a retail store in Los Angeles’ hip Silver Lake neighborhood and the shop also serves as a type of built-in factory where all the items are created. Many are made to order. Nikosey said he’s

focusing on e-commerce and will consider wholesale options in

the near future.PRICE POINTS: $59 for a leather

pouch to $695 for a leather backpack. The basketball kits start at $795 and the 24-karat gold one retails for $995.

In the SPOTLIGHT

Under Armour built its business on compression apparel.

at $795 and the 24-karat gold one retails for $995.

A weekender.

The gold basketball kit.