China tycoon bids to be Prada's biggest shareholder

However, Lu Qiang, chairman of Shanghai-based fashion factory outlet Foxtown may abandon the plans, saying Prada had raised its price for the additional stake after learning of his involvement.

Lu's bid was reported by China's Economic Observer newspaper on Monday.

"We had not planned to make the bid public. But somehow one media got the news and had a report on this. The price then became very high and therefore we are considering dropping the idea," FoxTown spokeswoman Irene Dou said.

She confirmed Lu gave an interview to the Economic Observer and did not dispute its report.

The newspaper said Lu had indirectly acquired 13% of Prada over the past two years and aimed to become its biggest shareholder with the planned acquisition of an additional stake of up to 20%.

Lu had been buying shares through an unidentified Italian consulting firm, which he acquired for €20 million (US$25 million), the newspaper said.

But Prada has since upped its price.

"(Prada thought) handing over the company to the Chinese will hurt the quality and taste," Lu was quoted as saying.

Lu's acquisition team had planned to invest €450 million ($566 million) in Prada by buying shares from the Italian fashion icon's creditors, the newspaper said.

But the cost of the acquisition had risen between €600 million and €700 million, the newspaper said.

He was quoted as saying he would sell his existing Prada shares if he fails to buy the additional stake in the coming week.

"I would sell all my current holdings," Lu was quoted as saying.

Source: AFP