The House of Gucci

by Sara G Forden

  Maurizio stopped pacing and looked at Franchini, then slumped in his chair, resting his hands on his knees.

  “OK, avvocato, OK. Tell me what I should do.”

  The war intensified. Maurizio removed De Sole from Gucci America’s board of directors, though he could not unseat him as CEO without a majority vote of the board. Flanz wrote a letter to Gucci’s board of directors calling for the appointment of a competent CEO. The letter never mentioned Maurizio by name or title, but its meaning was clear to all. The document infuriated Maurizio so much he sued Investcorp and Flanz for 250 billion lire, or about $160 million, for libel in a Milan court and even asked a Florence prosecutor to bring criminal charges against Flanz for defamation of character. On July 22, Investcorp filed arbitration proceedings against Maurizio in New York in an effort to force him to step down as chairman, charging him with violating the shareholders’ agreement and mismanaging the company. The court papers quoted Maurizio’s story about finding the money under the floorboards after his father came to him in a dream, in an effort to further discredit him.

  “We turned up the heat and pushed and pushed him,” said Bill Flanz. “But Maurizio, being a sailor, said, ‘I’m not going to surrender this company to the Arabs. I’ve lost everything, I’ve lost my fortune, I’ve lost my face, I’ve lost my respect in the business and I am going to take this ship down with me. We’re going down together.’”

  The war team truly feared he would.

  “In most cases, you assume a stance like that is a bluff,” said Rick Swanson. “But we were really worried. He seemed irrational enough that he just might do it.”

  The attacks continued hard and fast as De Sole sued Maurizio for the $4.8 million he said he had lent him between April 1990 and July 1993. Maurizio then sought further action against Investcorp in the Milan courts, moving to expel Flanz, Hallak, and Toker from the Gucci board.

  After weeks of trading blows, in a last-minute effort to salvage the relationship, Nemir Kirdar called to ask Maurizio to visit him in the south of France, where he habitually transferred his operations during the month of August. It had been more than a year since the two men had seen each other.

  “Maurizio? This is Nemir Kirdar.”

  Maurizio held the phone in silent disbelief.

  “I’m calling to see if we can get together,” Kirdar said. “I like you, Maurizio, I want to put all this fighting behind us. I’d like to see you on a personal basis. Will you come and spend a day with me in the South of France? We can have lunch and go out on the boat and have some fun.”

  Maurizio, recovering from his surprise, had the presence of mind to crack a weak joke. “Are you sure I will be safe?” he said meekly.

  “Maurizio, you are always safe with me,” Kirdar answered warmly.

  Maurizio, full of hope that Kirdar wanted to offer him a last-minute solution, traveled to the south of France the next day to meet the Investcorp chief for a poolside lunch on the balcony of the Hotel du Cap.

  “Maurizio, I want you to understand, whatever has gone on between our two companies, I have never stopped respecting you or your vision. But I have a business to run and I have been under the gun. Who knows, someday, if we can turn this company around and stop the losses and start to put some value in it, we might be able to do something together again.”

  As Kirdar spoke, Maurizio realized that Investcorp would not budge. There would be no last-minute solution. They spent a pleasant afternoon—as far as appearances went. Maurizio returned to Milan, dejected and disillusioned.

  That summer, Maurizio planned no vacation, but moved to the spacious apartment he had taken in Lugano, which offered cool breezes and a lake view from the shady green terrace. Maurizio commuted daily by car to his office in Milan.

  In September, Gucci’s Collegio Sindacale, or statutory supervisory board, notified Massetti that because Gucci’s shareholders were unable to resolve their differences and hadn’t approved any of the company’s accounts since the beginning of the year, the board was obliged by law to turn the company books over to the courts. The courts would then sell the company’s assets to pay off its creditors.

  “They gave me twenty-four hours of time…then they were going to take in the books,” said Massetti. He pleaded for a grace period of forty-eight hours, then called Maurizio and Fabio Franchini.

  “Maurizio was stuck,” Massetti said. “He was blocked on all sides. There was nothing he could do but strike an agreement.”

  “I can’t imagine the kind of pressure he was under,” added Swanson later. “As long as he had a lifeline, Maurizio was going to live through another day,” Swanson said. “It wasn’t until he was standing at the precipice—facing personal bankruptcy, company bankruptcy, losing everything—that he would face reality. And we were all wondering what was going to happen.”

  That afternoon, Maurizio drove to Florence and called a meeting of senior employees in the “Sala Dynasty” at 7:30 P.M.

  “So Dottore, what’s the upshot? Are we going to close down shop?” queried Degl’Innocenti with his usual gruff irony.

  “I have done it!” responded Maurizio enthusiastically. “I have found the money. I am buying out Investcorp.”

  “Fantastic!” responded Degl’Innocenti and the others, who had been rooting for Maurizio in the battle, fearing that if Investcorp took over it would slash jobs, close down the factory, and turn Scandicci into a glorified buying office.

  “The arrival of Investcorp had been painted to be the end of the world,” said Degl’Innocenti.

  While Maurizio rallied the Florence managers, the war team huddled in London, wondering what he was going to do.

  “Somebody called us and said that he had gathered the staff and given this bravissimo speech in classic Maurizio fashion, saying he was going to beat the Arabs,” recalled Swanson. “We were all wondering, ‘Is he going to sink the ship or is he going to be rational and sell?’”

  It turned out Maurizio’s speech was the final act in his brinksmanship play. Late that evening, the phone call came in—Maurizio was ready to capitulate.

  On Friday, September 23, 1993, Maurizio signed away his Gucci ownership in the offices of a Swiss bank in Lugano, surrounded by lawyers and financiers. That same morning, his secretary, Liliana Colombo, cleared his personal belongings out of his office on the fifth floor of the Piazza San Fedele building. The black-and-white photographs of Rodolfo and Sandra, the smiling faces of his daughters, the antique crystal and sterling ink set, the objects on his desk. Finally, with the help of two workmen, she had the painting of Venice that Rodolfo had given Maurizio taken down.

  “That’s what hit me when I next walked into his office on Monday morning,” said Gucci’s former administrative director, Mario Massetti. “Aside from his personal things, everything else was as it had been—except the painting from Rodolfo was no longer there,” recalled Massetti.

  That Friday night, Maurizio invited a small group of Gucci managers, including Massetti, to his apartment in Lugano for a private dinner.

  As a single waiter moved discreetly around the table, Maurizio explained to them that he had sold his stake in Gucci. “I did what I had to do,” he said simply. “I just wanted to let you know that I gave it everything I could, but they were too much for me. I had no choice.”

  When Maurizio’s call came in with the message that he would agree to sell, Investcorp moved quickly. The documents had already been drafted, and Rick Swanson and another Investcorp executive flew to Switzerland for the closing. They had settled on a price of $120 million.

  At the Swiss bank where the closing took place, “they had put me in a room and Maurizio was locked away in another conference room with all his lawyers and I wanted to see him,” said Swanson. “He was also a friend of mine and nobody had seen him for months, so I kept going out into the hall to see if I could catch a glimpse of him.”

  Finally Swanson marched down to the door of the conference room, pushed it open, and saw four or five la
wyers and Maurizio, pacing with his arms behind his back.

  Maurizio stopped and his face lit up. “Buongiorno, Rick!” he said, walking over to Swanson and giving him a bear hug in perfect Gucci style.

  “This is crazy! We are friends,” Maurizio continued. “I am not sitting here with all these lawyers.” They walked back down the hall together, chatting.

  “Maurizio,” Swanson finally said, taking a long look at the man he had worked so closely with for the past six years, “I am sorry about the way things turned out, but I want to let you know that we really believed in you and in your dream for Gucci and we will do our best to carry your vision forward.”

  “Rick,” Maurizio said, shaking his head slowly. “What am I going to do now? Go sailing? I have nothing left to do!”

  14

  LUXURY LIVING

  On Monday morning, March 27, 1995, Maurizio Gucci woke up at around 7 A.M., as usual. He lay still for a few minutes, listening to the sound of Paola’s breathing. She burrowed beside him in the massive Empire bed with its four neoclassical columns topped with a gold silk canopy and carved wooden eagle. It was a grand bed fit for a king, but then Maurizio loved being grand. He had scoured Paris with Toto Russo looking for the Empire furniture his friend had taught him to love, calling it “elegant, but not pompous.”

  The bed, along with other pieces he collected over the years, had been in storage until he and Paola Franchi, formerly Colombo, finally moved into the three-story apartment on Corso Venezia almost a year earlier. At the time, Maurizio and Paola had already been together more than four years, but it had taken more than two years to complete the renovations. In the meantime, Maurizio lived in a small bachelor apartment on Piazza Belgioiso, a quiet eighteenth-century square surrounded by imposing marble palazzi just behind the Duomo, and she stayed in a condominium owned by her ex-husband with their nine-year-old-son, Charly.

  Stately nineteenth-century palazzi lined Corso Venezia, a wide, treeless avenue that runs northeast from Piazza San Babila past the Giardini Pubblici. The palazzo where Maurizio and Paola lived at number 38 stands directly in front of the Palestro metro stop on Milan’s red line and diagonally across the street from the Giardini Pubblici. Its classical facade, covered with an unusual, okra-colored stucco, is simple compared with the fronts of other buildings up and down the avenue.

  Maurizio had met Paola in 1990 at a private party in a Saint Moritz dance club. Attracted by her handsome, blond beauty and lithe, lanky figure, he chatted with her at the bar. They realized they had known each other as teenagers, when they joined the same group of friends on the beaches of Santa Margherita. Maurizio liked Paola’s relaxed manner and easy smile—she seemed the opposite of Patrizia in every way. Aside from his two-year liaison with Sheree, Maurizio hadn’t had any other significant relationship since he had left Patrizia—who continued to occupy an important place in his life even though they lived apart. He and Patrizia talked frequently and argued often. He grew tired of their conflicts, but had little time or energy to pursue another relationship. Maurizio also had a deep fear of AIDS and had been known to ask his partners to take a blood test before he would go to bed with them.

  “Maurizio was one of the most eligible men in Milan, but he was not a womanizer,” added his friend and former consultant Carlo Bruno. “There were a lot of women interested in him, but he was not a playboy.”

  “Neither Maurizio nor Patrizia would ever find another partner of the same importance in their lives,” said an astrologer whom Patrizia had asked to do all of their charts, “although Paola’s chart had many of the same characteristics as Patrizia’s—so it was understandable that Maurizio would feel attracted to her.”

  When Maurizio and Paola met, she was estranged from her husband, Giorgio, a leading industrialist who had made his money in copper. The first time Maurizio invited Paola out for a drink, they moved on to dinner and talked nonstop until one in the morning.

  “He poured out the story of his life,” said Paola later. “He needed to talk, as though he needed to lighten a load that he had in his heart and in his spirit. He may have seemed to take on the world, but in fact he was an extremely sensitive person, very fragile in the face of certain things. He wanted to defend himself and explain his side of all the scandals he and his family had been through. It was overwhelming. He told me he wanted to be like an eagle, flying on high—able to see and control everything, but never get entangled.”

  In the beginning, they met secretly in his small apartment on Piazza Belgioiso, where Paola discovered that nothing made Maurizio happier than simple dinners at home. He sliced the salame while she poured out the red wine and they nuzzled under the vaulted ceilings before moving to the wrought-iron double bed, painted Pompeian red, where Paola consolidated her hold over Maurizio.

  “That apartment became our little love nest,” she said later. While Maurizio and Paola cavorted, Patrizia seethed. Despite their efforts to be discreet, they could not escape the informal network of spies Patrizia commanded from her penthouse apartment in Galleria Passarella, where Maurizio still paid all the costs. From friends who reported back to her, she learned that Maurizio had been seen around town with a tall, thin blonde and it didn’t take her long to discover Paola’s identity. Patrizia, who had her own lovers, feigned indifference, but she watched Maurizio’s every move.

  Toto Russo had found the Corso Venezia apartment for Maurizio. Initially, Maurizio had hoped to find an entire villa—even if it meant moving out of town—that could become “Casa Gucci,” a symbol of the same luxury and taste he had wanted the Gucci business to stand for. Maurizio never found his dream villa, but settled for the rental apartment on Corso Venezia.

  When Russo first brought Maurizio in through the large wooden entry doors, past the graceful wrought iron gate, and into the hushed calm of the inner courtyard, Maurizio liked the stately feeling of the building instantly and its relative quiet. Inside the thick stone walls, noise from the busy avenue outside seemed muffled, distant. Maurizio admired the colorful Palladian mosaic floor and the grand marble staircase that rose to the apartment from the left of the courtyard. Beyond the marble staircase a modern elevator, enclosed by two large wooden doors with glass panes, also led upstairs.

  Maurizio—still chairman of Gucci at the time—thought the prestigious location and luxurious setting was fitting for a person of his position. The apartment was on the first floor above the ground floor, or the piano nobile, so called in Italian because historically the noble families that once owned these grand palazzi always lived on that floor. At the top of the marble staircase, the front doors opened into a small entry hall. From there, two doors, side by side, led out to a long corridor. The kitchen and a large dining room were immediately to the right, then a series of parlors and reception rooms opened right and left off the long hall. At the end of it, the master bedroom suite overlooked a lush garden below, next to the Invernizzi garden. The apartment was so magnificent that its major drawback wasn’t apparent at first—there was only one bedroom. When Maurizio first saw it, he was separated from Patrizia and living alone. After meeting Paola, he grew determined to rebuild his family life and wanted to have Alessandra and Allegra come live with them too, so the owners, the Marelli family agreed to rent him a second apartment upstairs that had become available in the meantime. By putting the two apartments together, there would be enough room for the girls as well as Paola’s son, Charly. Maurizio rented both apartments and ordered an internal staircase built to connect them.

  “This is going to be our new home,” said Maurizio to Paola, putting his arm around her slim waist as their footsteps echoed through the empty rooms. Although it wasn’t “Casa Gucci,” the Corso Venezia apartment symbolized all he was working for: it was a fitting showpiece for Gucci’s CEO that also held the possibility of a new, more serene family life. Maurizio liked the idea that all three of their children could sleep under the same roof with them and in their own rooms. He longed for his daughters to spend mor
e time with him, and hoped they would once he and Paola were living together. Maurizio feared he would never have a healthy relationship with his daughters as long as Patrizia had so much control over them; even though it had been many years since he had moved out, the ongoing conflict between him and Patrizia had limited his ability to resurrect his relationship with the girls.

  The renovation and decoration of the Corso Venezia apartment took more than two years and several million dollars. By the time it was finished, its grandiose style raised eyebrows and set tongues wagging all around Milan. The gossips longed to get a peek inside, but Maurizio rarely entertained and pictures of the apartment were never published. However, the endless crews of workmen and the deliveries of precious antiques, custom-made fixtures, fine wallpapers, and sumptuous silks didn’t go unnoticed.

  The combined space of the two apartments measured more than 13,000 square feet over three floors and the annual rent alone was more than 400 million lire, or some $250,000. Maurizio turned to Toto for the furnishings—and gave him no limits. Russo—thrilled to have such an enthusiastic and willing client—outdid himself. The entire apartment was gutted, the floors were torn up, and walls were removed and replaced. Russo ordered laser-cut wood inlaid floors copied from a palace in Saint Petersburg, designed custom-made paneling and light fixtures, and selected luxurious wallpaper and rich drapes. Specialists restored or re-created the ceiling frescoes. Maurizio loved boiserie, the decorative French carved wood paneling, and he bought an original set that once belonged to the former king of Italy, Vittorio Emmanuele di Savoia, for the long dining room. Bought at an auction in France, the boiserie was painted celadon green and delicately worked with gilded frames, flower and vase motifs, and stained glass insets. Russo and Maurizio commissioned a massive faux-marble dining table because they couldn’t find one on the market that was long enough, and completed the room with pale gray curtains with a slight sheen and mirrors set into the walls. Designed for lavish banquets, that dining room also became the setting where the trio—Maurizio, Paola, and Charly—ate breakfast every morning.