World-renowned Paris boutique Colette has announced it will close at the end of the year, to be replaced by a new branch of global brand Saint Laurent.

The Rue Saint-Honoré store, which was founded in 1997 by Colette Roussaux, has been a trendsetter for more than 20 years. But the company took to Instagram yesterday to announce plans to shut up shop in December.

According to the post, the decision was made because Roussaux no longer wishes to be involved in the business.

"As all good things must come to an end, after 20 wonderful years, Colette should be closing its doors on 20 December of this year," said the statement.

"Colette Roussaux has reached the time when she would like to take her time; and Colette cannot exist without Colette."

Colette has long been a favourite among fashion circles thanks to its ability to bring both high-end fashion and streetwear together in one space – an approach that has since been replicated by stores like Dover Street Market, Opening Ceremony and 10 Corso Como.

It was named "trendiest store in the world" by Forbes just two years ago, and often plays host to book signings, concerts and panel discussions.

But in recent years, Roussaux has taken a step back to allow her daughter Sarah Andelman to run the store.

The company claims that Colette employees will be able to continue working at the store once it has been taken over by Saint Laurent, the French brand that now has stores in 36 countries.

"Negotiations are under way with Saint Laurent and we would be proud to have a brand with such a history, with whom we have frequently collaborated, taking over our address," reads the post.

"We are happy of the serious interest expressed by Saint Laurent in this project, and it could also represent a very good opportunity for our employees."

This spells the end of a frosty period between the two companies, which began when Colette released a collection of T-shirts emblazoned with "Ain't Laurent Without Yves" after then-creative director Hedi Slimane's decision to change the brand name from Yves Saint Laurent to Saint Laurent.

At the time, Saint Laurent demanded that the shirts be removed from Colette's online shop, and accused Andelman of selling counterfeit products that "seriously damaged" the YSL brand.