Hong Kong-listed fashion retailer Esprit has announced a joint venture business to take over the marketing and retailing of its products in Mainland China.
Through a subsidiary called Million Success, the fashion retailer will hold a 40 per cent stake in the Esprit China business, with the majority partner being Mulsanne Group, a company listed in Hong Kong last May. The deal covers the mainland only, not Hong Kong, Macau or Taiwan.
In a stock-exchange filing on Sunday, Esprit company secretary Patrick Lau Yiu Pong said Mainland China had always been “an important pillar” of Esprit’s strategic plan.
Subject to regulatory approvals, the joint venture is expected to launch in June next year. Prior to that, Esprit will be closing some underperforming mainland stores, before transferring the assets of the remainder to the JV company.
“The directors believe that the deal creates a strong base for the Esprit brand to improve relevance and accelerate growth,” said Pong in the filing.
Mulsanne Group is an investment holding company engaged in retail and online platforms for menswear, as well as product development. The company’s brands include GXG, GXG Jeans, GXG.Kids, Yatlas and 2XU. The group operates more than 2000 stores across Mainland China.
The registered capital of the JV company will be RMB100 million, with Mulsanne Group contributing RMB60 million.