Hong Kong-based Esprit Holdings Ltd. said Thursday it has agreed to buy out its joint-venture partner in China and acquire 100 percent control of Esprit’s operations in the country.
Esprit said it has reached an agreement to buy China Resources Enterprise Ltd.’s 51 percent stake in Esprit China for 3.88 billion Hong Kong dollars, or about $500 million at current exchange. Esprit holds a 49 percent stake in the venture.
Esprit said it will own 100 percent of Esprit China as of Feb. 17 or another date that is compatible with both parties.
As of June 30, Esprit China operated 1,112 outlets in 171 cities across China. The company posted net sales of 2.6 billion Hong Kong dollars, or about $335 million at current exchange rates, for the year ended Dec. 31, 2008.
“Building on top of the solid foundation CRE and Esprit established, we believe Esprit’s business in China will become one of the most important growth engines driving the further expansion of Esprit in the medium term,” said Esprit executive chairman Heinz Krogner.