FAST TRACK: Tadashi Yanai, chairman and chief executive officer of Fast Retailing Co. Ltd., wants to build his company into a $9.3 billion, or 1 trillion yen, empire. In a message to shareholders released last week, Yanai said Fast Retailing recognizes it has to enhance the appeal of its Uniqlo garments in Japan, where it has struggled, and to continue to expand overseas.

“The lessons we have learned through our expansion into the U.K. and Shanghai, China will prove invaluable for an early push into the U.S. and Asia,” he said. “This time around we are not necessarily looking to go it alone. We are also considering investments into and tie-ups with other firms that can help us expand our reach into several overseas countries more effectively and efficiently.”

It also is making acquisitions. Fast Retailing and Link International Co. Ltd. agreed to jointly acquire an ownership interest in Theory LLC in the U.S., with Link ultimately owning 89 percent of Theory’s stock. Fast Retailing is scheduled to become a 47.1 percent shareholder of Link, said the firm. Fast said the cost for acquiring the ownership interest was $62.6 million, or 6.7 billion yen. Dollar figures were converted at current exchange.

Link is the licensee for the Theory brand in Japan. “By jointly acquiring an ownership interest in Theory — the licenser — our aim is to further enhance the value of the Theory brand in the global market. In the medium term, we are also considering the launch of new brands in collaboration with Link. Looking ahead, Theory’s network and expertise in the U.S. apparel industry will provide a platform for further expansion of the Uniqlo brand,” said the firm.

The company announced drops both in net profits and sales in the fiscal year ended Aug. 31. Nonconsolidated net profits dropped 40.8 percent to $173.8 million (18.6 billion yen), while sales decreased 11.7 percent from the previous fiscal year to $2.8 billion (301.7 billion yen) and operating income dropped 13.9 percent to $433.6 million (46.4 billion yen), although the firm outperformed its initial plans.

In the year ending August 2004, the firm aims to achieve nonconsolidated sales of $3.1 billion (330 billion yen).— Koji Hirano

PAIR OF BEAUTIES:
The Frederique Group and the Beautiful Skin CentreGroup — the best-known spas, beauty centers and spa-training facilities in Hong Kong — announced their merger last week. The new company, called Paua Group, will include all of the existing entities, among them the Elemis Day Spa, the Frederique Spa, the Frederique Academy, the beautiful Skin Centre and FrancOrientale.

Rosemary Hamilton, group communications manager for Paua Group, said the merger has been in the works since last April. She declined to estimate projected earnings for the group, but did say that BSC’s training school, the International Health and Beauty Institute, will now be run by the Frederique Academy. The company is hoping to expand the distribution of Elemis products in Hong Kong and will investigate possible new spa and beauty centers. Frederique Deleage, founder of the Frederique Group, is also designing new spas in the region, including a luxury day spa at the Shangri-la hotel in Cebu, The Philippines.

— Constance Haisma-Kwok

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