By and  on January 18, 2005

PARIS — The face of beauty retailing is about to undergo a dramatic change.

If given the green light, A.S. Watson’s friendly acquisition of Marionnaud Perfumeries will create the world’s largest perfumery cosmetics seller, with more than 5,662 doors and projected annual sales of $10.2 billion.

On Friday, Hutchison Whampoa Ltd.’s A.S. Watson subsidiary announced a public offer for Marionnaud, confirming market reports, in a cash bid of $699.6 million, or 534 million euros. The per-share price offer is $28.56, or 21.80 euros, and the per-share OCEANE (bonds convertible into new shares or exchangeable for existing shares) price offer is $91.35, or 69.74 euros.

The total cost of the transaction, including debt, is estimated at $1.18 billion, or 900 million euros.

The acquisition’s approval is expected in March and is conditional on A.S. Watson’s getting more than 50.1 percent of the issued share capital. The company, owned by the Chinese entrepreneur Li Ka-shing, would like to take Marionnaud private, but to do so it would have to obtain over 95 percent of its shares.

The Frydman family, which owns almost 20 percent of Marionnaud, has agreed to the terms of the deal. Credit Agricole Group’s CAPE Holding has also said it would tender its shares, which make up 8.9 percent of the perfumery’s share capital.

A.S. Watson and Marionnaud executives say their firms can generate important synergies, in terms of marketing and merchandising, for instance.

“Why Marionnaud? We’ve been looking at France for a few years now,” said Ian Wade, group managing director, A.S. Watson Group, at an analyst and press conference Friday here. “Marionnaud is a great brand, with 30 percent market share” domestically. He added A.S. Watson hasn’t yet penetrated the French market. Nor has it entered Italy, Spain, Austria or Switzerland — among the 15 countries where Marionnaud is already a leader. It has 1,226 doors.

“Everything about us and Marionnaud is quite complementary,” said Wade.

Marcel Frydman, founder and chief executive officer of Marionnaud, agreed.

“We have many common values,” he said, adding A.S. Watson is the best partner for Marionnaud’s development. “It’s a happy marriage for everyone.”

To Read the Full Article

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus