In closing a massive financial transaction that gives a majority of the shares in Vivarte to four international equity funds, the newly appointed board of directors of the big French retail group promoted  on Oct. 29 Richard Simonin to the position of president and chief executive, replacing Marc Lelandais. An official press statement mentioned differences on future strategies for Lelandais' departure.

Vivarte runs 16 different retail chains and brands including major shoe retailers such as André, Minelli, Besson, Cosmoparis and San Marina as well as two big discounters for clothing and footwear, La Halle and La Halle aux Chaussures. With a total turnover of around €3 billion, half of which is in the footwear sector and the rest in clothing, it has a market share of close to 25 percent in the French shoe market.

Defined as a ruthless “serial manager” who has turned around other companies, the 63-year-old Simonin is expected to take strong measures to improve the profitability of La Halle, which has suffered the most from the competition, and of the whole group. Its operating earnings before amortization (Ebitda) have been falling steadily since Lelandais' appointment in 2010, due in large part to restructuring costs. They reportedly fell to around €175 million for the financial year ended last August, compared with €480 million in 2010/11.

As reported in the last issue of Shoe Intelligence, Simonin joined Vivarte's management at the end of September as deputy general manager, triggering speculation about Lelandais' possible resignation. Simonin, a Frenchman who speaks several languages, ran Harrods between 2003 and 2005, after four years as chairman of Escada. Most recently he has been running and turning around an Italian cosmetics firm, Limoni. During his long career, Simonini has worked at Pimkie and Kappa Sport. He has run two brands of LVMH - Givenchy and Kenzo - as well as a French mail order house, La Redoute, and Etam.

At Vivarte, Simonin will be aided by a general manager, Pierre Trotot, a former deputy managing director of SFR who had already been appointed last May. Simonin began to look into a reorganization strategy for Vivarte last summer in behalf of Oaktree Capital Management, one of the four funds that have acquired the majority of the group's shares. The other three are Alcentra Capital Corporation, Babson Capital and Goldentree Asset Management.

They have all appointed retail experts with experience at companies such as Printemps, Galeries Lafayette, Célio, Du Pareil au Même, etc. One of the new directors is Patrick Woodall, chief executive of Pragma Consulting, who became non-executive chairman of LK Bennett a few months ago, taking the place of Robert Bensoussan who resumed the role of chief executive. In the last 25 years, Woodall has run various companies in the retail and wholesale sector in the U.K. and abroad, including Warehouse and Esprit.

The four funds and nine others have agreed to guarantee the repayment of a loan of €500 million intended to revitalize Vivarte. The number of creditors has been reduced from 160 to 113, and many of them have converted debts into shares or bonds as part of a mega-transaction that has reduced the total debt from €2 billion to around €800 million.

The former controlling shareholder, Charterhouse Capital Partners, and other former investors who had taken over the company in a leveraged buyout in 2007, have pulled out of its equity as part of a settlement whose details remain unclear.