Gucci owner sells ill-fit­ting Puma brand

Irish Examiner - - Business -

A plan by France’s lux­ury goods firm Ker­ing to give up con­trol of Puma, fo­cus­ing solely on cat­walk and lux­ury brands such as Stella Mc­Cart­ney and Saint Lau­rent, sent the Ger­man sports­wear out­fit­ter plum­met­ing as much as 16%.

The plan, un­der which Ker­ing will dis­trib­ute 70% of the shares of Puma to its in­vestors, will leave Ker­ing founder François Pin­ault’s hold­ing com­pany Artemis with about 29% of Puma.

Ker­ing’s de­ci­sion dis­ap­pointed some Puma in­vestors, who had hoped that the French com­pany would find a buyer will­ing to pay a premium for the shares.

“This exit sce­nario is not the best one for Puma’s mi­nor­ity share­hold­ers,” Cedric Le­cas­ble, an an­a­lyst at Ray­mond James in Paris, wrote in a re­port.

“A straight­for­ward dis­posal of Puma at a premium might have been partly priced in by the mar­ket.”

Also, Ker­ing share­hold­ers may de­cide to sell the Puma shares they re­ceive in the spinoff, pres­sur­ing the stock in the short term, he said.

Ker­ing, which has Gucci on its port­fo­lio, fol­lows ri­vals in clean­ing up af­ter LVMH sold Donna Karan and Her­mes In­ter­na­tional di­vested Le­ica.

The de­ci­sion to spin Puma off is ev­i­dence of a lack of ac­qui­si­tion op­por­tu­ni­ties in lux­ury goods in the near term, Mr Le­cas­ble said.

Ker­ing bought Puma in 2007 as part of a push into sport and lifestyle brands that also saw the group ac­quire skate­board­ing brand Vol­com. “The con­tem­plated dis­tri­bu­tion of Puma shares to our share­hold­ers would be a sig­nif­i­cant mile­stone in the his­tory of the group,” Ker­ing chair­man FrançoisHenri Pin­ault, the son of François Pin­ault said.

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