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Italian hat maker Borsalino faces liquidation after court decision
[ MILAN] One of the world's most famous hat makers, Borsalino, whose stylish fedoras and straw panamas are popular with movie stars and celebrities, faces liquidation after a rescue plan was rejected by an Italian court on Monday.
A judge in the northern town of Alessandria, where the luxury hat maker was founded 160 years ago, refused a request for court protection from creditors, who are owed some 18 million euros (US$21 million), a local trade union leader told Reuters.
"It's dramatic if a solution is not found. Borsalino is part of Italian history, and it's a big name abroad too," Franco Armosino said.
Borsalino, whose hats have been worn by celebrities such as Humphrey Bogart in "Casablanca" and singer Rihanna, ran into financial difficulties after posting a large loss in 2013.
Former majority owner Marco Marenco was arrested by Swiss police in April 2015 on suspicion of financial crime.
For the past two years, the group has been run by Haeres Equita, a consortium led by Swiss-Italian financier Philippe Camperio, which invested some 10 million euros to relaunch the company.
Borsalino returned to profit in 2015. Sales in 2016 rose to 17.5 million euros and core profits more than doubled to 2.6 million euros. It expected revenue this year to be in line with last year's and sales to grow by 20 per cent in 2018.
But it was still struggling with debt and sought court protection from creditors.
Following Monday's decision, two court-appointed officials will wind down the company to pay back creditors. Mr Armosino said that unions expected further details "in the next days".
Mr Camperio, who bought the Borsalino trademark for about 18 million euros in May, could decide to bid for the company, or part of it.
The judge's decision will not stop production at Borsalino, which has 134 workers and makes some 150,000 hats a year, both Mr Armosino and Mr Camperio said.
"We will remain committed to finding solutions that will preserve this iconic brand and the interest of all stakeholders ...," Mr Camperio said in a statement, adding that bankruptcy had nothing to do with Haeres Equita's management.
"We hope to continue to build a future for Borsalino," Mr Camperio added.