HONG KONG – Belle International, China’s largest footwear retailer, is poised to go private.
A consortium of investors consisting of Hillhouse Capital Group, CDH Investments and Belle International management have offered to take the retailer off the Hong Kong Stock Exchange for 53.1 billion Hong Kong dollars, or $6.8 billion at current exchange. It would be among Asia’s largest consumer buyouts.
Each share has been valued at 6.30 Hong Kong dollars, or $0.81, representing a premium of approximately 28.38 percent over the average closing price for the past 90 days. After the deal is completed, Hillhouse will hold 56.81 percent of the company, while CDH will have 12.06 percent and members of Belle management, 31.13 percent.
“Belle International is at a critical moment and needs to be transformed,” Tang Yiu, chairman of Belle International, said in a statement on Friday. “It has become clear that our traditional retail business model is in urgent need of integration with the digital economy, and an effective new strategy and execution capabilities will be necessary to enable us to compete in the long term.”
Despite their efforts to keep up with the digitization of the marketplace, the company has been stymied by the decline of department stores, which are its main retail channel, and the firm has experienced 13 consecutive quarters of negative same-store sales growth since the end of February 2014.
Shenzhen, China-based Belle operates around 20,000 points of sale. It has more than a dozen in-house brands, including Staccato, Joy & Piece and Mirabell, and also serves as a distributor for Nike and Adidas in China.