Ruyi plans to buy UK trench coat maker for $120 mil­lion

China Daily (Canada) - - VIEWS - By BLOOMBERG

Shan­dongRuyi Group plans to ac­quire iconic Bri­tish trench coat maker Aquas­cu­tum for about $120 mil­lion, sources said, as Chi­nese com­pa­nies ex­tend a record over­seas deal­mak­ing spree.

The Chi­nese main­land tex­tile pro­ducer, which bought con­trol of French fash­ion group SMCP ear­lier this year, plans to buy the Aquas­cu­tum business fromHongKong-listed YGM Trad­ing Ltd and is con­duct­ing due dili­gence, ac­cord­ing to the sources.

Ruyi hopes to reach a fi­nal agree­ment in the next few weeks, one the sources said.

Ruyi joins Fo­sun In­ter­na­tional Ltd and Qing­dao Haier Co in seek­ing to ac­quire for­eign con­sumer brands that can be mar­keted to in­creas­ingly af­flu­ent Chi­nese shop­pers. Chi­nese com­pa­nies have an­nounced $50.2 bil­lion in over­seas con­sumer ac­qui­si­tions this year, up from $24.3 bil­lion dur­ing the same pe­riod in 2015.

Shares of YGM Trad­ing, which also dis­trib­utes theAsh­worth line of golf ap­parel, have risen 46 per­cent this year, giv­ing the com­pany a mar­ket value of $156 mil­lion.

YGMTrad­ing said in an Oct 17 ex­change fil­ing it had signed a mem­o­ran­dum of un­der­stand­ing to sell its Aquas­cu­tum brand business for about $120 mil­lion, with­out nam­ing the buy­ers.

There’s no cer­tainty the de­lib­er­a­tions will re­sult in a trans­ac­tion, the sources said. A rep­re­sen­ta­tive for YGM Trad­ing said she could not im­me­di­ately com­ment. A per­son who an­swered the phone at Ruyi’s head­quar­ters said no­body was an­swer queries.

Aquas­cu­tum was founded in 1851 in Lon­don by tai­lor John Emary, who in­vented a rain-re­pel­lent fabric.

The com­pany’s trench coats, de­vel­oped for use by the Bri­tish military, were later worn by UK for­mer prime min­is­ter Mar­garet Thatcher and US movie star Humphrey Bog­art, ac­cord­ing to Aquas­cu­tum’s web­site. YGMTrad­ing be­came the global owner of the brand in 2012.

Ruyi bought con­trol of SMCP, the French fash­ion group, from pri­vate equity firm KKR & Co ear­lier this year. The Chi­nese tex­tile pro­ducer has also in­vested in cloth­ing com­pa­nies in­clud­ing Tokyo-based Renown Inc. avail­able to

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