Gucci chief executive Mr Domenico De Sole and designer Mr Tom Ford will leave next year after failing to agree new contracts with owner Pinault-Printemps-Redoute (PPR).
PPR shares slumped this morning after it said Gucci's managerial dream team, who built an almost bankrupt family firm into the world's number three luxury goods company, would leave on April 30th, 2004, about the time that French retailer has promised to buy out minority Gucci shareholders.
PPR's shares were down 5.3 per cent at €83.60 by 8.47 a.m. Gucci opened 2.5 per cent lower then climbed back to € 73.80, down 1.9 per cent.
Mr De Sole and Mr Ford had previously said they would only stay beyond 2004 if PPR gave them full autonomy at the house.
"Intensive efforts by the parties [to renegotiate contracts] did not result in an agreement satisfactory to all concerned," Gucci and PPR said in a statement.
PPR owns a little less than 70 per cent of Gucci and has promised to buy out other shareholders for $85.52 per share from early 2004 at a total cost of about $2.5 billion.
PPR originally bought a strategic stake in Gucci in 1999, working closely with Mr De Sole in a "white knight" move to save the Florentine fashion house from hostile takeover bids from the world's leading luxury conglomerate, LVMH.