Prada and Cavalli: Italian fashion titans

Two Italian fashion moguls known for their fiery personalities have been making news this week.

Patrizio Bertelli, CEO of Prada announced his company's intention to go public in 2008. The industry has heard a similar announcement from Prada at least three times in the last decade, only to see the IPOs get called off due to unfavourable market conditions.

Mr. Bertelli has become known for his astute product eye and his challenging personal style.  He is thought to have control over the leather goods businesses while Mrs. Prada focuses on the creative ready-to-wear businesses. Each has their own domain, as it were, and Bertelli's success with leather goods speaks for itself. However, some have questioned how he will cope with answering to the public markets, when he has been answerable to noone up until now -- not even his wife Miuccia, in some cases.

The announcement about the IPO emphasises the professional team and structures that have recently been put in place, addressing criticisms that have been placed on the company in the past. Bertelli said:

In the last few years, Prada has successfully completed a reorganization which led to an increase in profitability and to a strengthened leadership position. Now, we look at the financial markets with efficient industrial processes and a strong and experienced management team.

Perhaps Bertelli has wisened up to the ways of the market, seeing an opportunity to cash in on the controlling stake that he and Mrs. Prada have in the company, which was founded by her grandfather in in 1913. The company is in good shape, with a strong outlook for 2008 and 2009.

Things couldn't be more different over at Cavalli. The Wall Street Journal published

[ an articleOpens in new window ]

describing how

has turned down two offers valuing his company at more than 14x operating profit, higher than what normally might be paid in the fashion industry. He also fell out with the company's first professional CEO, Roberto Jorio Fili, after only 13 months.

The Journal pulls no punches in painting Cavalli as a stubborn, irrational man. Despite his personal savvy and success at building a global fashion brand, they note that Cavalli has done so under the cloud of tax evasion charges. It also says he didn't get a penny from the  sell-out H&M collection which launched this autumn, saying that the profile boost amongst young consumers from the advertising campaign warranted doing the collaboration on its own, without a design fee or royalty revenues.

Cavalli says he is still looking for an investor. Unless he takes a page or two out of Mr. Bertelli's book, he may be looking for a long time. Then again, some change may already be afoot. Word has it that his wife had a major role in the subdued S/S 2008 collection shown in Milan in September to great acclaim.