By mutual agreement, Inter Parfums SA and Balmain have decided to end their licensing agreement, initially set to last until 2024.
ON THE SCENT: Balmain’s fragrance license could soon be up for grabs. By mutual agreement, Inter Parfums SA and Balmain have decided on an early termination of their licensing agreement, initially signed for 12 years starting from January 2012.
Despite the celebrity favorite being hot property in fashion land right now, thanks to creative director Olivier Rousteing, its fragrance sales have declined over the past two years, falling 21 percent to 3.8 million euros, or $4.2 million at average exchange, in 2016, and declining 5.8 percent the previous year.
Nevertheless, Philippe Benacin, chairman and chief executive officer of Inter Parfums SA, denied that the reason behind the early termination was its failure to gain traction in the category. “Balmain had an exit option from 2018 that was part of the contract when the license was initially signed,” he told WWD.
He said that at the time, Alain Hivelin — Balmain’s former majority owner, who died in 2014 — had told him that if the label was ever sold, he would like to be able to get the license back in exchange for a fee.
Mayhoola for Investments, the Qatar-based parent of Valentino and Pal Zileri, bought a majority stake in Balmain last July, as reported. “They confirmed in July when they bought Balmain that they wanted to advance the option and take back the brand from 2017,” said Benacin.
Inter Parfums is set to cease deliveries of Balmain products at the end of March.
Since the Paris-based subsidiary of U.S.-based Inter Parfums Inc. took over the license, it had introduced three new scents to the lineup: Ivoire in 2012, Extatic in 2014 and most recently Balmain Homme in July 2015.
The portfolio also includes Vent Vert, launched in 1947; Monsieur Balmain, introduced in 1964; Ambre Gris, from 2008, and Carbone, which hit the market in 2010.
The brand’s fragrance sales in 2012, the first year of their integration, were 1.5 million euros, or $1.9 million, rising to 5.1 million euros, or $6.8 million, in 2014.
All dollar figures have been calculated using average exchange rates for the period to which they refer.
According to Benacin, Balmain’s new owners are likely to take advantage of buzz around the brand to reinvigorate its fragrance business in the future. “I think they will do something with it, they will probably take a break for a year to clean up the brand and come back with new projects,” he said.
Officials at Balmain were not immediately available for comment.