Doubts loom over Versace flotation following murder

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MILAN -- In the wake of Italian designer Gianni Versace's death, his brother Santo, CEO of the fashion house, and his sister, Donatella, who designs the Versus collection, both stated that "Gianni was about the future, so we will carry on the business."

The siblings were forced to consider life without their brother two years ago when a cancerous tumor was discovered, but despite a debilitating round of chemotherapy treatments, Gianni re-emerged stronger than ever. What remains a question is the company's intention to take the nearly $1bn business public next June with an initial offering on the Milan stock exchange, followed by the New York bourse.

Born in Reggio Calabrio, Gianni Versace, 51, was one of the first European designers to successfully launch a line of brand extensions and secondary lines, such as the Istante, Versus, Versace Jeans Couture and Versace V2 Classic clothing lines, and to hook up with a number of Italian companies to produce a range of licensed products such as leather accessories, home furnishings and sunglasses.

The company controls 75% of Gianni Versace Profumi, the beauty subsidiary responsible for 15 fragrances and the highly anticipated makeup line, slated to debut worldwide in September.

The company's foray into cosmetics is an attempt to further enhance brand image in the market and bring the designer's fashion flair and love of color to the beauty side.

In 1996, pretax profits for the fashion division totaled $103m and global sales hit $497m. An in- house creative team handles advertising, although Versace himself worked closely on the campaigns in collaboration with director Sergio Salerni.

In the U.S., the design house often worked with New York-based agency Shahid & Co. on the Versace men's wear ads

The designer used singer and actress Madonna in a past campaign and recently engaged actress Patricia Arquette as the model in his fall/winter 1997 campaign.

The designer, himself, was one of the protagonists in his television campaign for the prestigious men's fragrance, The Dreamer, launched in the fall of 1996. When asked "What is your dream?" he replied, "To be Gianni Versace."

Copyright July 1997, Crain Communications Inc.

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