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Giordano takeover bid lapses as acceptances fail to reach threshold

(Source: Giordano / Facebook)

A takeover bid for control of apparel company Giordano has fallen short, despite shareholders being given extra time to accept the offer. 

Documents filed with the Hong Kong stock exchange show that shareholders owning a collective 46.04 per cent of the issued capital of Giordano had accepted the offer from Clear Prosper Global, the investment vehicle of Chow Tai Fook Nominee, a company privately owned by the Cheng family, that controls the listed jewellery business Chow Tai Fook and New World Development Group. The head of the family, billionaire Henry Cheng Kar-shun, is Hong Kong’s third-richest individual, and the father of entrepreneur and K11 founder Adrian Cheng. 

The offer equated to US$325.6 million for shares and options, representing 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. 

The offer document stipulated acceptance by shareholders representing 50 per cent of Giordano’s shares in order for the deal to proceed. With that threshold not reached, Clear Prosper – which owns 24.57 per cent already – has confirmed the bid has lapsed. 

In a statement quoted by the South China Morning Post, Chow Tai Fook Nominee said that both the independent board committee and independent financial adviser of Giordano advised independent shareholders to accept the offer, considering it fair and reasonable.

“Although the offer has lapsed due to inadequate acceptances… CTFN will continue to proactively assist in the business development of Giordano, and maintain a dialogue with its management and other stakeholders,” the statement said. 

Giordano was founded by media magnate Jimmy Lai Chee-ying, who left the business in 1996.

The company makes and retails clothing under its namesake brand Giordano along with Giordano Junior, Giordano Ladies, and BSX, among others. It has around 14,000 employees and 2100 stores in 30 international markets, in a combination of directly owned, franchised and joint-venture subsidiaries.  

During 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. 

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