Puma recruits fashion designer to glam up brand (Reuters)

PARIS (Reuters) - Sports goods maker Puma AG on Thursday appointed fashion designer Hussein Chalayan as its creative director in a bid to enhance its style status and mark itself out from rivals like Adidas.

Puma, the worlds third largest sportswear maker, made the announcement during Paris Fashion Week where Chalayan presented a critically acclaimed womenswear collection for fall 2008.

"We want to be different, thats the idea behind this. We dont want to be mass market and selling to discount stores, we just want to keep a premium," Puma Chief Executive Jochen Zeitz, told Reuters in an interview at the presentation.

Chalayan, famous for his thought-provoking designs, would bring his use of new technology and provocative point of view to Puma, Zeitz told a news conference.

Zeitz is credited with turning Puma into a lifestyle brand and making it one of Germanys best-known exports.

Collaborations with designers are a regular feature in the cut-throat retail industry as the worlds biggest brands seek to differentiate themselves and lure in ever-pickier consumers.

Puma, has already worked with edgy, top rated designers Alexander McQueen and Jil Sander.

Meanwhile German rival Adidas has seen its business boosted by its long-term collaboration with Stella McCartney, whose top end fashion house is owned by Puma parent company PPR.

Bernstein Research analyst Marco Giovanelli said the deal was a signal Puma was aiming to move upscale in fashion terms.

"Puma has the strongest fashion credentials of any of the sportswear companies so this makes complete sense," he said.

"Its trying to differentiate itself from competitors like Nike and Adidas."

"A MARRIAGE"

Chalayan, who was born in Cyprus and has carved out a niche as an avant garde designer, called the agreement "a marriage" rather than a short-term relationship. He will oversee design for all Pumas footwear, clothes and accessories.

Chalayan graduated in 1993 from the prestigious London art college Central Saint Martins, which boasts other well-known graduates John Galliano and McCartney.

Puma said this week fourth-quarter earnings rose more than 20 percent but still lags rivals Adidas and Nike, both of which are about five times its size in terms of sales.

Zeitz also announced on Thursday that Puma had acquired a majority stake in Chalayans London-based fashion business and brand Hussein Chalayan.

"Acquiring majority shares of the Hussein Chalayan brand is giving PUMA the ability to move into a new space, expanding our reach to become the most desirable sport lifestyle company in the world," Zeitz said.

Fashion may have long been considered irrelevant to sportswear but this was a misconception -- consumers want both, he said.

"You buy a car because it looks good and drives fast -- its the same with our product," he said.

(Editing by Paul Casciato)