Sport Brands International Ltd (SBI) on Friday unveiled a strategic reorganisation of Italian sportswear company Fila which will see it axe at least 550 jobs and close all its US retail stores.

The firm will cut 350 jobs in Europe, of which 250 will be in Italy, by the end of 2003 and create regional centres of excellence around in product design, development, sourcing and marketing in Maryland, Milan and Seoul.

Product sourcing responsibilities will shift to the company's Asian headquarters in Seoul and will also be managed from Fila's existing offices in Hong Kong.

Its footwear and apparel design as well as marketing offices based in Maryland and New York City will be expanded to accommodate the shift in global responsibilities to those locations.

A footwear research and development facility based in Peabody, Massachusetts, will close by the end of this month and those responsibilities switched existing office in Montebelluna, Italy.

Fila's US retail division, which currently operates 14 outlet stores, will be closed by the end of the year and the company will shift its footwear sourcing centre currently based in Taiwan to China.

SBI CEO, Jon Epstein, said: "Our goal is to be closer and more responsive to market needs and quicker to meet our customers' requirements. By doing so we will be able to build a stable, profitable and sustainable business.

"We regret that we have had to make some difficult decisions. By making these decisions we will be able to compete and prosper on a long-term basis."

He continued: "The strategic reorganisation is another critical step in making Fila an efficient and flexible organisation in a highly competitive market and in building a solid foundation for the company's future growth.

"We are extremely confident in our highly qualified and experienced management team and their strategic plan for Fila … the company is in a strong financial position which will only be enhanced by our restructuring plans."

Fila recently announced a strategic partnership with Proline, a subsidiary of Mint Apparel, in the UK, which will see Proline assume sales and operations responsibilities for the Fila brand in Britain.