CEO Ihamuotila: Marimekko is not for sale

Rumours circulating that Spanish Inditex is interested in Marimekko

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President and CEO Mika Ihamuotila denies all rumours of an acquisition of the Finnish textile and clothing design company Marimekko by the Spanish clothing chain Inditex, known for several brands including Zara, Massimo Dutti, and Bershka.
      CEO Ihamuotila says that Marimekko is not for sale.
      ”I naturally do not know whether or not Inditex has any purchasing plans, but in any case, they have not come into contact with us. There have been no negotiations, and nor will there be any”, Ihamuotila says firmly.
     
The Finnish business daily Kauppalehti reported on Thursday that the international investment bank Credit Suisse has assisted Inditex by outlining a plan to buy Marimekko.
      Inditex, owning more than 900 outlets worldwide, is one of the largest fashion distributors in Europe, and according to Kauppalehti, it is after Marimekko chiefly because of its interior decoration textiles which would be a nice fit for Zara Home furnishings.
     
Marimekko is a small enterprise even by Finnish standards, the international efforts of which are insignificant compared with those of major players.
      When Ihamuotila stepped onto the stage as the new CEO of Marimekko on February 1st, 2008, his plan was to expand Marimekko into an international fashion, interior design, and lifestyle brand.
      One of the greatest obstacles to achieving this goal was the lack of an international distribution and sales network. Cooperation with for example Inditex could open an excellent opportunity for this.
     
Nevertheless, CEO Ihamuotila does not want such cooperation.
      ”We wish to keep the Marimekko brand for ourselves and to grow as an independent company. There are many bad examples of what could happen when a fashion or design brand is sold to a bigger company in which it is just a part of the assets of a large conglomerate. Original corporate culture, morale, and the ability to create a brand tend to get lost”, Ihamuotila argues.
      According to Ihamuotila, Marimekko is now trying to create a concept of building an international distribution and sales network which could be used in many countries.
      ”It has not been completed yet, but we feel that we are on the right track”, Ihamuotila notes.
     
Unlike many Swedish fashion chains, none of the Finnish clothing design companies have managed to create a successful international sales network or to sell themselves abroad.
      Ihamuotila hints at a possibility that Marimekko could be interested in buying related know-how from Sweden.
      ”At the moment, we do not plan to hire anybody from Sweden; I am satisfied with the current team”, Ihamuotila asserts.
     
Marimekko has been in a state of some tumult ever since Ihamuotila took over the Finnish fashion icon from the firm’s former CEO Kirsti Paakkanen.
      The company has lost one manager after another - some have left voluntarily while others have been dismissed.
      Old collections have been turned upside-down, Marimekko patterns have been revamped, and the company’s profits have dropped.
      As could be expected in the current financial crisis, Marimekko announced on Wednesday that the company is to shed 35 employees.
      In 2008, Marimekko net sales amounted to EUR 81.1 million. Exports and international operations accounted for some 27% of Group net sales. The Marimekko Group employs just over 400 people.


Previously in HS International Edition:
  Marimekko reports difficult first quarter (9.4.2009)
  Kirsti Paakkanen sells her remaining Marimekko holding (9.1.2009)
  COMMENTARY: Creases in the Marimekko frock (23.12.2008)
  Banker confronts challenge of poppy patterns (13.11.2007)
  New Marimekko CEO says serious illness led to change of direction (1.11.2007)
  Kirsti Paakkanen to surrender ownership of Marimekko (31.10.2007)

Links:
  Marimekko
  Inditex

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