Richemont spent 19 years trying to make Shanghai Tang a luxury brand, then gave it away

David Tang founded Shanghai Tang in Hong Kong in 1994 with an ambitious vision: create the first proudly Chinese luxury brand, built on 1930s Shanghai aesthetics and the craftsmanship of tailors who had left Shanghai for Hong Kong in 1949. Richemont acquired a controlling stake in 1998 and full ownership by 2008, expanding the brand to 34 locations worldwide, from Madison Avenue to Paris to Tokyo.

The expansion repeatedly stumbled. The New York flagship on Madison Avenue closed in less than two years because sales could not justify the rent. In October 2011, the original 6,300-square-foot Hong Kong Pedder Building flagship shut after 17 years when Abercrombie & Fitch offered two-and-a-half times the rent. The brand was too dependent on Western tourists visiting Hong Kong and struggled to appeal to mainland Chinese consumers, who overwhelmingly preferred European luxury houses.

In July 2017, Richemont sold Shanghai Tang to Italian entrepreneur Alessandro Bastagli and Hong Kong private equity fund Cassia Investments for an undisclosed sum, noting 'no material impact' on its financial results. The brand changed hands again in December 2018 to Lunar Capital. Nineteen years of Richemont ownership had not produced a self-sustaining luxury business.