Spain-based Iame has not given up on its dream to launch a Spanish luxury fashion holding to take on the likes of LVMH, despite failing to raise the funds necessary to pursue the project last year.

Private equity firm Iame had planned to roll out a EUR500m (US$750m) buy-out fund called Brand Capital Management Spain (BCS) last year to fund the development of the holding that would have the same name.

But the collapse of Spain's economy last year triggered a deep plunge in consumption, prompting even the wealthy to tighten their belts, and ruining the firm's project.

Iame advised a group of investors - mainly wealthy families in Mexico and Spain - to hold their money until better times.

And those better times may come in the third quarter of next year, according to Iame Chairman Luis  Sans Abad, who said the firm hopes to resurrect the project then.

"We hope the economy and consumption will start improving in the first quarter and if so, we will begin contacting investors and re-launch our fundraising efforts."

He added that if everything goes well, Iame will raise the EUR500m fund by mid 2010.

It will then begin analysing potential investments. Iame's aim is to buy blocks of promising luxury, designer and accessory firms to run them together to achieve economies of scale.

"If all does well this will be Spain's answer to LVMH or Printemps," Abad said. "There are many great fashion designers and luxury brands in Spain that have been overlooked and we hope to give these companies the chance to break into the international markets."

Abad said Iame has analysed hundreds of companies and already picked 50-100 as the best investment targets for when the fund is ready.

If all goes well, the firm will open a Mexico City office to take BCS to the international markets within the next five years, challenging Spanish textile giants such as Zara and Mango which have already made their mark.