New Delhi, Nov. 6 (PTI): Megha Mittal, daughter-in-law of Indian-born billionaire Lakshmi Mittal, will buy Escada, an iconic but insolvent European luxury fashion house, for an undisclosed amount.

Megha today confirmed winning the German Escada, which had filed for bankruptcy in August, at a Munich auction. “Our first priority is to ensure the great heritage of this iconic company is translated into a strong and successful future,” said the 33-year-old wife of Aditya Mittal.

Escada, which has 182 shops and 225 franchise outlets in over 60 countries, is a favourite among Hollywood stars like Katie Holmes and Hillary Swank. But it has fallen on bad times after years of poor sales.

Megha, whose gamble mirrors her father-in-law’s penchant for reviving run-down steel mills, is confident of fashioning a turnaround.

“Despite recent difficulties, Escada has the potential to re-define its place in the world of luxury brands and become synonymous with fine quality and elegance.” Megha is no stranger to business: she was Aditya’s classmate at Wharton Business School before they got married.

Escada released a statement saying the insolvency administrator had “signed a sale and transfer agreement with one of the Mittal Family Trusts”, adding that the preliminary creditors’ committee had cleared the deal.

Under the agreement, Escada will transfer its business operations, including employees and worldwide brand rights, production facilities and sales and distribution structure, to the trust. The transaction will be subject to customary anti-trust approvals.

The company board and Megha have agreed to cooperate on the basis of a business strategy launched last year, the statement said.

Megha backed the current CEO. “I am confident that under the leadership of Bruno Salzer, we have the right team to achieve this (a turnaround).”

The statement added that “with the execution of the agreement, all key assets of Escada’s operative business as well as shares in subsidiaries will be transferred to the trust”.