Portugal Colonial - Armani's will lays path to potential buyout by rival

The Italian designer, who died on September 4 aged 91, had kept strict control of the multi-million-euro empire he built up over five decades, which ranged from haute couture to hotels.

But in his will, published by the Italian press, he said that the foundation which inherits the company should sell a 15 percent stake to a major fashion house.

He named French luxury giant LVMH, cosmetics group L'Oreal and eyewear firm EssilorLuxottica as his preferred buyers, although another of similar stature would also be acceptable.

L’Oreal, which has sold Armani perfumes and cosmetics since 1988, said on Friday it was "touched and honoured" that Armani had considered the group a potential stakeholder, saying it would consider the idea carefully.

The new shareholder would then have the possibility of taking a majority stake in the group within three to five years of the opening of the will on Thursday.

If there is no sale, Armani requested his company be listed on the stock market, with the Armani Foundation retaining 30.1 percent of the shares.

In a statement, the executive committee of Giorgio Armani insisted the foundation would maintain a strong influence whatever happened.

"The foundation... shall never hold less than 30 percent of the capital, thereby acting as a permanent guarantor of compliance with the founding principles," it said.

These include an ethical approach with "moral integrity and fairness", the global development of the Armani name, and a focus "on innovation, excellence, quality, refinement of the product and the pursuit of an essential, modern, elegant, and understated style".

- 'Financial stability' -

Armani's net worth was estimated at $11.8 billion at the time of his death, according to Forbes magazine.

The Milan-based designer had no children and bequeathed his entire company to his foundation. It will be managed by the man closest to him, Leo Dell'Orco, and his nephew and niece.

The foundation will hold 10 percent of the company's shares and the remainder in bare ownership -- ownership without the right of use, according to the will.

The foundation will have 30 percent of voting rights, with another 40 percent allocated to Dell'Orco and 15 percent each to his niece Silvana Armani and nephew Andrea Camerana.

"Mr Armani's intention to safeguard strategic continuity, corporate cohesion and financial stability for long-term development is confirmed at every stage," the company statement said.

It added: "The will specifies that all short- and medium-term strategic decisions will rest with Mr Dell'Orco and the family, supported by the foundation."

It added that the potential partner would be a company "of recognised standing and (have) genuine interest in the brand" Armani built.

The designer's real estate empire was bequeathed to his sister Rosanna and his niece and nephew.

But Dell'Orco retains the use of properties in Saint Tropez in France, St Moritz in Switzerland and on the islands of Antigua and Pantelleria.

Armani died after months of fragile health, and his remains have been laid to rest alongside those of his family in the family tomb of Rivalta, near Piacenza, the city where the designer was born.

His death sparked tributes from his peers in the fashion world as well as by politicians and stars, but his funeral on Monday was attended only by close family and friends.

Armani's final collections will be presented later this month at fashion week in Milan, where an exhibition opens on September 24 marking 50 years of the brand.

C.Cassis--PC