By Cristina Roca 
 

Kering (KER.FR) said Thursday that it is grouping most of its Swiss logistics activities into one hub and relocating them to Italy over the next three years.

The owner of Gucci said it was making the move, which will affect the jobs of around half of the 800 people it currently employs in its 20 warehouses in Switzerland, in order to adapt to a changing environment.

Earlier this month, the French luxury-goods group settled a charge with the Italian tax authorities regarding its Swiss logistics subsidiary, Luxury Goods International SA, for the record-high amount of 1.25 billion euros ($1.39 billion).

In January, the Italian revenue agency said that Kering's Swiss subsidiary was conducting business activities in Italy and paying taxes for these profits in Switzerland, which has a singificantly lower corporate tax rate.

The new hub, which will be based in northern Italy, close to Novara, will increase Kering's stock-keeping capacity and improve its logistical efficiency, the company said. It will be delivered from 2020 to 2022, Kering said.

The company's logistics activities in Switzerland will be substantially sized down, but will stay in use. Kering is working closely to mitigate the impact on employment, it said.

Kering said that as part of a review of its global network, it has also decided to move its central U.S. warehouse to a new location in New Jersey, U.S., which is currently under construction, and will also need to make new investments in Asia.

Kering didn't disclose any details on the size of these investments.

 

Write to Cristina Roca at cristina.roca@dowjones.com; @_cristinaroca

 

(END) Dow Jones Newswires

May 23, 2019 11:55 ET (15:55 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
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