The designer, Mr Paul Costelloe, who this week disposed of most of his business interests to a UK silk supply company, says that talent alone is no longer enough to get by on. As fashion houses have increasingly globalised, access to investment, marketing and distribution channels is necessary, he says.

The £1.25 million acquisition of Mr Costelloe's United Fashion and an associated licensing deal by Silk Industries, a public company with a turnover this year of £16 million, will provide a muchneeded financial injection. This will help to consolidate the Paul Costelloe UK and Irish sales and allow it to gain a foothold in Europe.

Despite having had Diana, Princess of Wales, as one of his clients, Mr Costelloe admits that his designer business had levelled off and had even become "slightly stagnant".

"There is a lot of money being invested in the big names, and they are becoming lifestyle names.

"Sadly in this industry, if you do not have the muscle, you will not succeed," he says.

He describes the middle years of his business, the 1990s, as a time when there were good ranges and bad ranges, but turnover remained static. "That was the real problem. Our turnover plateaued because of finance largely. It was fairly frustrating from that point of view.

"People say you should change every 10 years, I have left it slightly late. I am just changing course a little," he says.

Having independent women in high-profile positions has been a godsend for him. The late Princess of Wales had him as a favourite, although he says she looked her best in casual clothing, campaigning on the landmines issue or "coming out of the gym". The Duchess of York "was difficult to dress", but he now has his eye on Ms Cherie Blair, the British Prime Minister's wife, as "a pretty independent woman".

"It is a market I cater for. They can all relate to my clothing because it is not over-feminine, because they are basically fairly serious, not female objects of desire," he says.

But big names do not necessarily mean big money. His business registered a loss before tax of £17,000 on a turnover of £4.64 million last year, part of which he puts down to the opening of the flagship shop in Knightsbridge, London. This year a profit is expected, he says, with a good retail performance and a positive reception for his winter collection. He describes the acquisition by Silk Industries of most of his business as a licensing deal, which allows him to keep control of the Paul Costelloe name as design director.

"It is not a buyout totally," he says, "If the standard is not correct I can say `sorry'. It is going to be a very tightly controlled arrangement for everybody's benefit."

He still has the licences for his eyewear, for Cambridge Opticals, cutlery, produced by Newbridge Cutlery, and a crystal range for Cavan Crystal, under his own company, Paul Costelloe Design Management.

But he is most associated with clothing and he hopes to introduce a younger range, "but still retaining the same relaxed style, not over-fashionable".

Menswear too remains a challenge, and with a former manufacturing director of Calvin Klein as the new chief executive of United Fashion, it will be one of the areas to be targeted. Mr Costelloe has noticed that men have become "amazingly" fashion-conscious. "Hopefully not too much. I hope that they do not become total peacocks...We do not need to become Italian, all style and no content."

The £350,000 he received for his 22 per cent stake in United Fashion and the licences leaves him without any share in Silk.

"It is totally on fee and performance of business, which suits me fine," he says. But he will invest in Silk. "It is like backing your own horse," he says.

While his business acumen is undeniable, he also has the air of the artist struggling to find his own space, what he describes as a "Dr Jekyll and Mr Hyde mix". "It is slightly disorienting. Because of that I see both sides of everything, which is difficult. "I believe my strength is design and I am looking forward to spending a little bit more time on the drawing board and being a bit more relaxed on everything else," he says. He is proud of his roots and spends every weekend at his home in Monkstown, Dublin, with his wife, Anne, and their seven children.