By  on September 5, 2014

Silas Chou and Lawrence Stroll are about to exit the Michael Kors business.

Michael Kors Holdings Ltd. has filed a shelf registration to sell slightly over 11.6 million shares of common stock in a secondary public offering that would have Chou and Stroll resign from the Kors board upon the closing date of the offering.

Thursday’s filing with the Securities and Exchange Commission said the selling shareholder is Sportswear Holdings Ltd., one of Kors’ principal founding shareholders. According to the filing, Sportswear is indirectly owned by Westleigh Ltd., which is privately owned by members of the Chao family, including Chou, and 50 percent owned by Flair Investment Holdings Ltd, of which Stroll has an indirect beneficial ownership interest.

The Kors company will not receive any proceeds from the sale. Following the resignation of Stroll and Chou, Kors will have seven board members, five of whom are classified as independent.

The designer Michael Kors began his business more than 30 years ago. After a bankruptcy in the early Nineties, Kors sold the business to Chou and Stroll in 2003 for a reported $100 million. The company grew at a fast pace, and, in December 2011, completed its initial public offering, selling 47.2 million shares and raising $944 million. Stroll and Chou sold about $519 million worth of stock combined, while Kors sold about $117 million worth of stock. Shortly before the IPO, the owners sold another $500 million stake in a private sale to mutual fund firms such as Fidelity and T. Rowe Price.

Following the IPO, Chou and Stroll owned roughly 38 percent of Kors. The two have gradually reduced their stake in Kors through different investment vehicles, including Sportswear Holdings.

In a January filing with the SEC, Chou and Stroll beneficially owned 11.6 million shares, or 5.7 percent of the total shares outstanding. The sale following the secondary offering essentially liquidates their holdings in the company, hence their resignation from the board.

Chou and Stroll, who have invested together for years, were responsible for taking public, in 1992, Tommy Hilfiger’s business, which eventually was taken private in a sale to Apax Partners. Apax subsequently sold the company to PVH Corp.

Shares of Kors closed up 1.6 percent, to $79.97, in Big Board trading on Thursday.

The sale of the 11.6 million shares at Thursday’s closing price would net $930 million, excluding costs associated with the secondary offering.

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