China's Shandong Ruyi to take over Sandro, Maje labels - sources | Reuters

PARIS China's Shandong Ruyi ( 002193.SZ ) is set to buy control of SMCP, the French firm behind fashion brands Sandro, Maje and Claudie Pierlot, for 1.3 billion euros ($1.5 billion) including debt, two sources close to the deal said on Tuesday. The deal, which as of early Tuesday evening had not yet been signed, was expected to be announced on Wednesday, they added. Sandro, Maje and Claudie Pierlot, which sell dresses priced at around 200 euros, operate in the so-called accessible segment of the luxury market, enjoying solid demand among fast-growing middle classes, particularly in countries such as China

hidden March 30, 2016 01:00:16 IST
China's Shandong Ruyi to take over Sandro, Maje labels - sources
| Reuters

Chinas Shandong Ruyi to take over Sandro Maje labels  sources
 Reuters

PARIS China's Shandong Ruyi (002193.SZ) is set to buy control of SMCP, the French firm behind fashion brands Sandro, Maje and Claudie Pierlot, for 1.3 billion euros ($1.5 billion) including debt, two sources close to the deal said on Tuesday.

The deal, which as of early Tuesday evening had not yet been signed, was expected to be announced on Wednesday, they added.

Sandro, Maje and Claudie Pierlot, which sell dresses priced at around 200 euros, operate in the so-called accessible segment of the luxury market, enjoying solid demand among fast-growing middle classes, particularly in countries such as China.

SMCP, which is controlled by private equity firm KKR (KKR.N), had filed documents this month to launch an initial public offering in Paris as early as April.

The company's preparations for a float had added pressure on the Chinese group to strike a deal, the sources said. One of the sources said that talks had accelerated in the past week.

The sources confirmed a report by the Financial Times.

KKR declined to comment and no-one at SMCP was immediately available for comment.

Talks with textile group Shandong Ruyi had been going on for at least six months, but had gone cold earlier in the year over price differences, sources close to the talks had told Reuters.

One of the sources said that founders Evelyne, Ylan Chetrite and Judith Milgrom, who together own 21.11 percent of the company were more in favour of an IPO but KKR, which has 70 percent, backed a deal with the Chinese group.

The founders, together with the company's management will retain a minority stake under the deal, the sources said.

SMCP plans to expand outside of France, where it makes just under half of its sales, particularly in China, the U.S., Britain, Spain and Italy. It also wants to develop digital sales, menswear and strengthen its leather goods offering.

The IPO was meant to pay down the company's high yield debt, which stood at around 290 million euros.

Last year, SMCP made earnings before interest, tax, depreciation and amortisation (EBITDA) of 107 million euros on revenue of 675 million euros, up 33 percent and 11 percent, this did not include a boost from new stores.

(Reporting by Astrid Wendlandt; Editing by Geert De Clercq and Alexander Smith)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

also read

Estee Lauder sales hit by lackluster demand for makeup, shares drop
Business

Estee Lauder sales hit by lackluster demand for makeup, shares drop

By Aditi Sebastian (Reuters) - Estee Lauder Cos Inc missed analysts' estimates for quarterly sales on Monday, as weak demand for its luxury foundations and lipsticks offset growth at the cosmetics maker's skincare brands, with people continuing to work from home. The company's shares, which touched a record high last week, fell nearly 7%. Sales of cosmetics and makeup products have taken a hit during the COVID-19 pandemic as shoppers stay at home, pressuring Estee Lauder's M.A.C and Bobbi Brown brands

Supply constraints slow U.S. factory activity in April
Business

Supply constraints slow U.S. factory activity in April

By Lucia Mutikani WASHINGTON (Reuters) - U.S. manufacturing activity grew at a slower pace in April, restrained by shortages of inputs as rising vaccinations against COVID-19 and massive fiscal stimulus unleashed pent-up demand. The survey from the Institute for Supply Management (ISM) on Monday showed record-long lead times, wide-scale shortages of critical basic materials, rising commodities prices and difficulties in transporting products across industries

Oil rises over 1% as demand hopes bolster sentiment
Business

Oil rises over 1% as demand hopes bolster sentiment

By Stephanie Kelly NEW YORK (Reuters) - Oil rose more than 1% on Monday as Chinese economic figures and U.S. vaccination rate pointed to a strong rebound in demand in the world's two largest economies