Aeffe Seeks Financial Rescue Through Negotiated Settlement Amidst Steep Losses

Italian fashion group Aeffe is actively pursuing a path to financial recovery, initiating a negotiated settlement procedure in light of its significant economic challenges. This critical step began on October 2 when Aeffe and its subsidiary Pollini formally applied for the procedure, a move designed to address the group's financial difficulties.

The Chamber of Commerce for Romagna Forlì-Cesena and Rimini has since appointed Riccardo Ranalli as the independent expert to oversee this crucial negotiated settlement. Ranalli officially confirmed his acceptance of this assignment on October 8. Both Aeffe and Pollini’s application for the procedure, alongside Ranalli’s acceptance, were subsequently published in the relevant company registry on October 9, marking a formal progression in their recovery efforts. Furthermore, Aeffe disclosed that it filed a separate request for insolvency protection measures with the Bologna court on October 10.

It is important to note that this specific procedure initiated by Aeffe is focused solely on the parent company and Pollini, explicitly excluding the group's other prominent subsidiaries such as Alberta Ferretti and Moschino. The outcome of these negotiations is paramount, as a failure to reach a negotiated settlement would likely pave the way for more formal judicial proceedings, potentially leading to options like a company voluntary arrangement.

Aeffe has been grappling with severe financial struggles for over two years, experiencing a dramatic decline in both revenue and profitability during this period. The group has already implemented cost-cutting measures after reporting its H1 revenue at €100 million, a significant 27% decrease, while its losses simultaneously expanded to €28.5 million. These figures underscore the depth of the challenges facing the fashion conglomerate.

The announcement that Aeffe’s board, under the leadership of Massimo Ferretti, had applied for the negotiated settlement procedure had an immediate and stark impact on the market. Aeffe's share price plummeted to a new low of €0.25, representing a substantial 43.3% drop, and consequently shrinking the group's market capitalisation to less than €30 million. This sharp market reaction reflects the serious concerns surrounding the group's financial health.