VLCM Valcom (MM)

French retail to luxury group PPR SA (PP.FR) will take as long as it needs to buy and sell assets in a manner that creates value for the company, PPR Chairman and Chief Executive Francois-Henri Pinault said Thursday, echoing comments made in the past.

"We will take the time necessary to select brands to join us and to sell our retail activities under the best conditions," he said, speaking at the company's annual shareholder meeting.

PPR is in the process of shedding its retail assets while adding to the brands organized around its star luxury label Gucci and main sportswear brand Puma AG Rudolf Dassler Sport (PUM.XE).

Pinault cited luxury as an area where the company could make acquisitions, particularly medium or modest-sized companies that it could develop on an international basis. In describing the kinds of luxury targets in which PPR might be interested, Pinault mentioned brands the company already owns, like Balenciaga, Yves Saint Laurent or Bottega Veneta. He said Bottega Veneta's annual sales were around EUR35 million when it bought the company in 2001, but last year increased to over EUR500 million.

Brands with a "certain degree of maturity" are less attractive than "a smaller brand we feel has high potential," Pinault said.

As for potential sport and lifestyle brands, finding potential acquisition targets is more complicated, Pinault said. "The question is what brands have true legitimacy," given the enormous number competing in that sector, he said.

The company recently launched an offer for the U.S.-based skate and surf apparel group Volcom Inc. (VLCM).

PPR also plans to sell its catalogue sales division Redcats and electronics retailer Fnac.

Pinault added the group doesn't depend on acquisitions to grow.

-By Mimosa Spencer, Dow Jones Newswires; +33 1 4017 1740; mimosa.spencer@dowjones.com

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