IT Holding, the owner of luxury fashion brand Gianfranco Ferre, has gone into administration, in a move that will enable it to stay in business while being restructured.

The move comes just a fortnight after its young lines division Ittierre was also place in administration.

The decision was reached after Ittierre, which is licensed to produce and distribute ready-to-wear under the VJC Versace, Versace Sport, Just Cavalli, C'N'C Costume National and Galliano brands, ran out of funds to pay its licensors.

Extending administration to IT Holding, which employs 1,800 people, was not entirely unexpected since its senior notes become "immediately redeemable" if a subsidiary falls into administration.

But it does confer IT Holding with the dubious honour of becoming the first high profile European luxury company to receive government bankruptcy protection.