PARIS (Reuters, AFP) - Colette, one of the French capital's trendiest fashion stores, will close its doors in December after 20 years, with its founder set to retire.

It said it was in talks with fashion house Saint Laurent over the latter possibly taking over the location of the shop, based on Paris' chic Rue Saint Honore and often thronged with wealthy Asian tourists.

Colette, well-known for its frequent in-store events and for hosting everything hip from furniture, music, and fashion to toys and even waters, was founded in March 1997 by Colette Roussaux and her daughter Sarah Andelman.

"All good things must come to an end. After 20 wonderful years, Colette is set to definitively close its doors on Dec 20," it said in a statement. "Colette Roussaux has reached an age when it's time for her to take her time, and Colette cannot exist without Colette."

The three-storey shop was declared "the coolest shop in town" by fashion critic Suzy Menkes and is a regular haunt of designer Karl Lagerfeld's. "It's the only shop where I go because they have things no one else has," he has said.

Referring to the talks with Saint Laurent, the store added: "We would be proud to have such a prestigious brand, with whom we have frequently collaborated, taking over our address."

The fashion house threatened to sue Colette four years ago when it had a line of parody T-shirts bearing the words "Ain't Laurent Without Yves" after the death of the label's founder, Yves Saint Laurent.

The store also features an arts exhibition space, bookshop and water bar, and generated revenues of 28 million euros (S$44 million) last year.