TOKYO — Japanese apparel manufacturer and distributor Renown Inc. said Monday it will issue about 4 billion yen, or $44.4 million, worth of new shares to Chinese textile manufacturing company Shandong Ruyi Science & Technology Group.
This story first appeared in the May 25, 2010 issue of WWD. Subscribe Today.
Shandong Ruyi will become Renown’s largest shareholder with a stake of 41 percent. Shandong Ruyi’s current client base includes international brands and retailers such as Hugo Boss, Oxford Shop, J. Philipp and El Corte Inglés.
Renown Inc. said it will issue about 33.3 million new shares, valued at 120 yen each, or $1.36, to the Chinese company. The transaction is scheduled to take place on July 30, subject to approval and authorization by the relative authorities.
Renown said it hopes to take advantage of the transaction to grow its presence in the Chinese market. The Japanese company said it plans to capitalize on Shandong’s sales network in China and its experience manufacturing high-quality, low-cost textiles and clothing products. Renown has been battling losses and has been attempting to restructure its operations over the past few years.
“After being in the red in recent years…we are now concentrating our management resources on superior brands,” the Japanese company said.
For the full year ended Feb. 28, Renown posted a loss of 10.95 billion yen, or $117.26 million at average exchange.
Last year, Renown sold Aquascutum to U.K.-based Broadwick Group Ltd., an investment vehicle controlled by retail tycoon Harold Tillman, chairman of the British Fashion Council, and Belinda Earl, chief executive officer of Jaeger, for an undisclosed price.
Tillman and Earl sold Aquascutum’s intellectual property rights, including the Aquascutum trademark for China and the rest of Asia, to Hong Kong-based YGM Mart Ltd., Renown continues to manufacture and distribute the British brand’s products in Japan through a long-term master licensing agreement with YGM.
Renown’s brand portfolio includes a number of brands targeting the Japanese market such as Arnie Arnold Palmer, Ensuite, Simple Life and D’Urban.