Chinese firms snap up chunk of French fashion industry
Apr 1, 2016
French ready-to-wear fashion labels Sandro, Maje and Claudie Pierlot will be taken over by China's Shandong Ruyi Technology Group under the terms of an exclusivity agreement announced late Thursday.
Hot on the heels of the announcement, French lacemaker Desseilles said Friday it is to be acquired by Chinese firm Yongsheng, in another sign of the growing Chinese presence in France's fashion industry.
In the deal for Sandro and Maje's parent company SMCP, the founder of the "accessible luxury" labels, sisters Evelyne Chetrite and Judith Milgrom, will remain minority shareholders if the deal goes through, as will their management team and the US investment fund KKR.
KKR acquired a 65-percent share of SMCP in 2013.
Shandong Ruyi gave no financial details, but the Financial Times reported this week that the deal valued the group at 1.3 billion euros ($1.5 billion), including debts.
The Chinese group will invest in SMCP "with the ambition to drive further growth and support the company's global development, including in Asia", the statement said.
SMCP sells its brands in 33 countries.
Shandong Ruyi, one of the largest textile manufacturers in China, pledged to maintain SMCP's headquarters in Paris.
On a smaller scale, high-class lacemaker Desseilles said it would be taken over by Yongsheng, following an arbitration decision by a commercial court.
Desseilles said Yongsheng's bid was chosen from the three companies in the running because it has promised to maintain the jobs of 60 of the firm's 74 employees for at least three years.
The Chinese firm also made a commitment to keep the Desseilles factory in the northern port city of Calais for at least five years.
Lacemaking has a strong tradition in Calais, whose economy has been hit hard by the presence of a large camp of refugees hoping to reach England across the Channel.
Michel Berrier, Desseilles' marketing manager, admitted that the identity of the new owners had intially created some alarm, but he insisted it was unfounded.
"As soon as you say 'Chinese' when talking about a takeover, you get a knee-jerk reaction, but in this case the fundamental point was to maintain and develop the site in France," he told AFP.
He described Yongsheng's project as "very ambitious" and said the group wanted to tap "French expertise in lacemaking" to develop clothing for the Chinese market.
Desseilles already exports 70 percent of its production to Asia.
Berrier said Yongsheng intends to invest around 4.0 million euros ($4.5 million) in the next few years and to buy the factory, which Desseilles currently rents.
"If everything goes as planned, Desseilles will take on more staff in the next three years to meet new orders," he added.
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