Marcolin has reached a preliminary contract for a worldwide five-year license agreement for sunglasses and prescription frames with the Diesel brand, owned by the eponymous Italian fashion group. The parties will aim to finalize the deal by Oct. 31. Safilo holds the license until Dec. 31 and had previously expressed doubts about its renewal.
Safilo's license agreement with Diesel started in 1994 and the brand represents about 2 percent of the eyewear group's sales, which reached €1.011 billion in 2009. The decision does not involve the Diesel group's other brand, 55DSL, whose license agreement with Safilo also terminates at the end of the year and for which no announcement has been made.
When Safilo warned earlier this year that it might not renew the Diesel license it said that it would only keep profitable brands. It is however willing to make concessions for brands that are part of a larger group. Two of its license agreements expiring this year, Yves Saint Laurent and Bottega Veneta, are owned by Gucci, which is one of Safilo's key brands.
But Safilo's main focus is to renew the Christian Dior license. The deal finishes at the end of 2010 and is estimated to represent up to 15 percent of its revenues.
Financial analysts do not rule out the possibility of Safilo's becoming more selective regarding other second-tier brands in its portfolio. Among Safilo's license agreements expiring over the next 18 months are Kate Spade, finishing on Dec. 31, as well as J.Lo by Jennifer Lopez, Nine West, Saks Fifth Avenue and Valentino, all terminating at the end of 2011.
Over the past two months, Marcolin has enjoyed a strong rally on the stock market amid speculation that it could sign new license deals, especially with Diesel. The license will add about 10 percent to its annual revenues. In 2009, Marcolin booked sales of €180.3 million. But, the investment bank Banca IMI does not believe that Marcolin has the potential to lure Dior away from Safilo. At the end of July, Marcolin was trading at €2.86 compared with around €1.80 at the beginning of June.
Meanwhile, a smaller Italian eyewear manufacturer, Sover, is also in the race for new licenses. After having obtained the Laura Biagiotti license it is scheduled to announce another brand acquisition soon. De Rigo is also scheduled to announce a new license, while dropping an existing one. Earlier this year, De Rigo stopped the Etro license after signing on Blumarine and Blugirl (see articles in today's Eyewear Intelligence).
One of the up-and-coming Italian fashion brands currently seeking an eyewear license is Jeckerson. The sportswear company reported sales of €60 million in 2009 and aims to double revenues by the end of 2014 by diversifying from its original focus on golf into casual wear, as well as opening a string of single-brand stores in Italy, France, Germany, Spain, the U.K., the U.S. and China. The brand previously had an eyewear license with the bankrupt manufacturer Visibilia.