The New York Post reports that Emanuel Ungaro shuttered its Madison Avenue boutique in an effort to stop bleeding money. Apparently the label racked up reported debts of $25 million in 2004 when it was owned by Salvatore Ferragamo. Silicon Valley venture capitalist Asim Abdullah bought the label in 2005, but it’s been unable to financially recover. An investment group reportedly approached Abdullah about buying the label, but a source said “all bets are off” following Lohan’s runway debut in October, which the Post reminds us “included pasties and microskirts that bared models’ buttocks.”
Lohan confirmed a few weeks ago that she was no longer working for the label. But according to the Post, she wasn’t a great expense to it anyway: Sources claim the label paid her in clothes instead of cash. Problems reportedly arose when Abdullah, a software engineer, decided he wanted a younger client base for the label and brought on Lohan, forcing out designer and editor darling Esteban Cortazar.
Sources tell the Post that the Plaza is trying to get people to rent spaces in its underground mall by telling them Ungaro is moving in. But it’s hard to see how leasing a space in the Plaza would help Ungaro, since fewer people would shop there than ever. They may as well open up in the South Pole.
Emanuel Ungaro abandons boutique; eyes buyer [NYP]