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PARIS (Reuters) - Donna Karan has resigned as chief designer of the fashion brand she founded and sold to French luxury goods owner LVMH (LVMH.PA) as the group opts to concentrate on its more accessible DKNY line.
Parent company Donna Karan International (DKI) said it planned to suspend fashion shows and designer collections "for a period of time" but would continue to support its significant license business for products such as watches and eyewear.
"DKI will also reorganize its teams and restructure in order to substantially increase its focus on the DKNY brand," it said in a statement on Wednesday.
New-York born Karan, 66, said that after "much soul-searching" she had decided to spend more time on her separate Urban Zen brand.
Fashion experts had long been saying that her mainline Donna Karan New York label lost appeal among consumers after becoming too zany with designs featuring tribal prints.
The move is part of a wider clean-up at LVMH's fashion and leather brands under the stewardship of division chief Pierre-Yves Roussel.
In April, the company hired Dao-Yi Chow and Maxwell Osborne, founders of the New York-based and award-winning brand Public School, as designers for DKNY, a more street-smart and less expensive label than the high-end Donna Karan brand.
Analysts estimate DKI made just over 400 million euros ($444 million) in 2014 with more than 90 percent of revenue coming from the DKNY brand.
The two brands together have over 275 retail stores and more than 80 in-store outlets across 41 countries.
When Donna Karan sold her brand to LVMH in 2001, the group was looking to gain a stronger presence in the US market.
At the time, she had obtained from LVMH the right to exploit the Urban Zen brand she had also created, a move that surprised many industry observers since it was a rival brand to her own.
DKI said Donna Karan would remain an adviser to the company.
Earlier this year, LVMH decided to restructure the underperforming Marc by Marc Jacobs line and fold it into the main Marc Jacobs collection which is also being streamlined.
Marc Jacobs also been closing shops including a flagship one on the plush Place du Palais Royal in Paris.
In 2013, Marc Jacobs left the creative helm of Louis Vuitton, LVMH's biggest luxury brand, to focus on his eponymous brand and its planned initial public offering expected to take place in the next few years.
Reporting by Astrid Wendlandt; Editing by Keith Weir