Takeover whispers surround SMCP

SMCP, the owner of French fashion brands Claudie Pierlot, Maje and Sandro, has attracted takeover bids from Lion Capital and Chinese textile producer Shandong Ruyi Group, according to reports in Hong Kong.

Bloomberg says the clothing group could be worth more than US$1 billion in the sale.

Private equity player Kohlberg Kravis Roberts (KKR) acquired a majority stake of Group SMCP in June 2013, and is reported to have engaged banks last year to consider strategic options, including the sale of its stake.

Demand is soaring in China for affordable luxury labels like SMCP’s three brands, fuelled by the country’s growing middle class.

With more than 1000 stores in 34 countries, the SMCP group is adding shops in Hong Kong and seeking opportunities to expand in mainland China, CEO Daniel Lalonde said last year. In the first half of 2015 it added 12 outlets in Asia, where it has stores in China, Hong Kong, Indonesia, Korea, Macau, Singapore, Taiwan and Thailand.

Sales over the same period were up 32 per cent on the same period in 2014, reaching €316 million (US$344 million). Onlines sales doubled.

KKR, Lion Capital and Shandong Ruyi Group are not commenting on the possible takeover.

KKR bought its 65 per cent of SMCP from L Capital, a private-equity firm backed by LVMH Moet Hennessy Louis Vuitton.

Lion Capital is a UK private-equity firm focused on consumer investments, and includes British fashion retailer AllSaints and food producers Bumble Bee Foods and Findus Group.

Based in eastern China, Shandong Ruyi Group has annual sales of more than 30 billion yuan ($4.6 billion), according to its website. It has invested in such clothing companies as Tokyo-based Renown, which sells the Aquascutum and D’urban brands in Japan.

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