Lu's bid was reported by China's Economic Observer newspaper on Monday.

However, Lu Qiang, chairman of Shanghai-based fashion factory outlet Foxtown may abandon the plans, saying Prada had raised its price for the additional stake after learning of his involvement.

"We had not planned to make the bid public. But somehow one media got the news and had a report on this. The price then became very high and therefore we are considering dropping the idea," FoxTown spokeswoman Irene Dou told AFP.

She confirmed that Lu had given an interview to the Economic Observer and did not dispute its report.

The newspaper said Lu had indirectly acquired 13 percent of Prada over the past two years and aimed to become its biggest shareholder with the planned acquisition of an additional stake of up to 20 percent.

In Italy, an executive at Prada, who declined to be named, told AFP that the assertion by Lu that he had bought 13 percent of the business was "totally unfounded."

He said: "No member of the Prada family has sold shares to Lu Qiang." He said that of the capital "94.89 percent is held by the Prada family and Mr. Bertelli, husband of Miucha Prada, and 5.11 percent by the Intesa Sanpaulo bank."

In Shanghai, the newspaper report said that Lu had been buying shares through an unidentified Italian consulting firm, which he had acquired for 20 million euros (25 million dollars).

But Prada has since upped its price.

"(Prada thought) handing over the company to the Chinese will hurt the quality and taste," Lu was quoted as saying.

Lu's acquisition team had planned to invest 450 million euros (566 million dollars) in Prada by buying shares from the Italian fashion icon's creditors, the newspaper said.

But the cost of the acquisition had risen between 600 million and 700 million euros, the newspaper said.

He was quoted as saying he would sell his existing Prada shares if he failed to buy the additional stake in the coming week.

"I would sell all my current holdings," Lu was quoted as saying.

At the end of June, the Italian newspaper Corriere della Sera reported that Prada, which has been mulling a stock exchange listing for years, was eyeing a a valuation of more than four billion euros (five billion dollars).

Current valuations for the company are ranging "between three and four billion euros" daily Corriere della Sera said, citing bank sources, adding that the company "is aiming at exceeding four billion."

The company, founded as a leather-goods shop in 1913, has put off the decision to launch an initial public offering several times in the past decade, most recently because of poor market conditions.

Earlier in June, the Italian press reported that Prada was considering listing its shares on the Milan and Hong Kong stock exchanges.

The group's sales totalled 1.56 billion euros last year.

earlier related report
In China, EU firms face local competition
Beijing (UPI) Jul 12, 2010 - Western wind power companies active in China are fighting to keep their share of the world's fastest wind growing market.

China in 2009 installed 13 gigawatts of new wind power capacity, compared to 10 GW in Europe and 9.9 GW in the United States, figures from industry group Global Wind Energy Council indicate. This year, China could add up to 18 GW of capacity.

By 2017, it will have the world's largest accumulated capacity, topping the U.S. and European markets, GWEC spokeswoman Angelika Pullen said recently.

With Beijing pumping billions of dollars into green energy, Western companies are eager keep profiting from this lucrative renewable energy market.

Several large European and U.S. wind turbine manufacturers have a manufacturing presence in China, including General Electric, Denmark's Vestas, Nordex and Siemens Wind Power of Germany and Gamesa of Spain. Back in 2005, they controlled more than 70 percent of the still small Chinese market.

But as Beijing is boosted its renewable energy profile, an increasing number of local firms formed to become fierce competitors to the Western companies.

Today, three Chinese companies -- Sinovel, Goldwind and Dongfang -- are among the top 10 of the world's largest wind turbine suppliers. Sinovel, the world's third-largest turbine

maker based on 2009 market share, last year sold around 2,500 turbines, almost all of them in China. Goldwind ranked fifth in the 2009 and Dongfang seventh.

The Chinese success is aided by cheap licensing of older Western technology, a steep learning curve and aggressive national subsidies that favor domestic suppliers.

The Europeans know that they can't meet the Chinese production costs; instead, they have to bank on size and quality, two aspects of the turbine they still dominate.

Siemens later this year plans to open a turbine plant in Shanghai that will produce 3.6 MW turbines -- larger than anything made by a Chinese company.

Gamesa has been active in China since 2000 and is to open a new turbine plant, its fifth in the country, in the northwestern Jilin province in 2011. The factory will manufacture 2 MW wind turbines at an output capacity of 500 MW per year, the company says. Earlier this year, Gamesa opened a similar plant with a capacity of 400 MW.

Western companies are confident that it can sustain their market edge.

"It's true that Asia is challenging us but competition is also not to be seen as a bad thing," Klaus Willnow, a top innovation official at Siemens, said recently. "I see it also as a good thing. Competition drives the business."

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