A subsidiary of Hong Kong’s largest jewellery retailer, Chow Tai Fook, has lodged a takeover bid for casual fashion group Giordano.
According to a document filed with the stock exchange, the CTF subsidiary will offer up to US$325.6 million for shares and options. That represents a premium of 18.2 per cent over the closing price of the shares on June 7, the last day they were traded ahead of a trading halt pending the takeover announcement.
Share trading resumed yesterday after the details of the takeover bid were released. The offerer says it intends to maintain Giordano’s public listing and has no intention to make any major changes to the business, cull employees or sell any of its assets.
“The offeror intends to work together with the company’s management to review the structure, operation and business of the group with a view to enhancing and strengthening its business by, amongst other matters, taking advantage of the extensive network and experience of the offeror’s group companies and affiliates, especially in the retail sector,” the stock exchange filing said.
The Chow Tai Fook subsidiary and its affiliated parties currently hold 24.57 per cent of Girodano’s shares.
For the year to December 31, Giordano achieved a profit attributable to shareholders of $20.5 million, a significant turnaround from the $10.6 million loss recorded the preceding year.
Giordano produces its namesake brand Giordano along with Giordano Junior, Giordano Ladies, and BSX, among others. It has around 14,000 employees and 2056 stores in 30 international markets, in a combination of directly owned, franchised and joint-venture subsidiaries.
Sales during the second half of last year rose 8.3 per cent to US$432.2 million.
The company was founded in 1981 by Jimmy Lai, who left the business in 1996.