Gucci gains control of Puma
17 Jul 2007
French
luxury goods maker PPR, which owns Gucci, has taken effective
control of German sportswear maker Puman with 62.1-per
cent stake, following its extended share offer for the
group till 11 July.
PPR, which has been gradually building up its stake in
the German group, first bought a 27-per cent holding in
Puma in April for €330 a share, a 19 per cent premium
on Puma''s share price before news of the deal emerged
in April, putting a value on the company at €5.3
billion.
Several Puma investors held on their shares in the hope of Gucci offering a better price for a better deal for the world''s third largest selling sportswear maker behind Nike and Adidas.
However, earnings and falling profits at Puma dashed their hopes of a better offer; in February, the company reported that its profits had fallen by 26 per cent to €32.8 million during the final three months of 2006.
However,
most of Puma''s drop in profits was due to higher costs
linked to its expansion, and the sportswear maker''s sales
actually rose by more than a third to €480.6 million.
The Herzogenaurach-based firm''s sales have increased five-fold
in the past six years.
When
PPR announced its friendly takeover move in April, Puma
welcomed it, saying it was fair and in the firm''s best
interests.
