Stefano Gabbana has resigned as chairman of Dolce & Gabbana, reportedly considering options for his stake in the Italian company ahead of negotiations with its bank lenders.
Gabbana, 63, who founded the fashion house with his then-partner Domenico Dolce, resigned in December, according to an Italian company filing. Alfonso Dolce, Domenico’s brother and current chief executive, took over as chairman in January.
The fashion mogul is considering alternatives for his roughly 40 percent stake in the company, which is entering a new round of talks with creditors, sources told Bloomberg.
The company has been weighed down by a prolonged downturn in the luxury goods sector, exacerbated by the uncertainty caused by the war in the Middle East. The setbacks have weighed on profits and made it harder to meet the terms of its debt.
Dolce & Gabbana’s lenders are now seeking an injection of up to 150 million euros 3 in new capital as part of a broader 450 million euro debt refinancing, Bloomberg sources said. The company is considering selling real estate and renewing licenses to raise the money, they said. Bloomberg News reported last month that the company is being advised by Rothschild.
From opulence to debt
As part of the management changes, the company is also set to appoint former Gucci CEO Stefano Cantino to a top management role, Bloomberg reports.
The iconic fashion label was founded in 1985 and quickly became one of the most recognizable fashion brands in the world with its Mediterranean-inspired aesthetic.
Although the couple have been separated for more than 20 years, they have remained business partners, with Domenico Dolce, 67, also holding a 40% stake through a holding company. The rest belongs to Domenico, Alfonso and their sister Dorothea.
Faced with a global decline in demand for luxury goods, Italian fashion houses are increasingly open to mergers and new capital from investors. After Valentino breached debt terms, owners Kering and Mayhoola agreed last year to provide 100 million euros as part of a deal with banks. Prada acquired Gianni Versace, while Giorgio Armani stipulated in his will that his heirs sell an initial 15% of the company’s shares within 18 months.
Dolce & Gabbana has sought to maintain its independence by expanding into beauty, real estate and hospitality.
As part of an agreement reached with banks last year, the company refinanced its debt until February 2030 and raised 150 million euros in new debt to finance its expansion.
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