A mosaic by Zao Wou-Ki at the Kering headquarters in Paris.

PARIS — Is Kering gearing up to buy a new brand?

The company is selling a large proportion of its holdings in Puma, a move that analysts flagged as a balance sheet shoring-up exercise that could clear the way for M&A activity from the luxury goods group.

In a statement Wednesday, Kering said it has launched a procedure to sell a 5.9 percent stake in Puma and place 8.9 million shares with investors. Following the transaction, the luxury group will continue to hold 4 percent of the footwear company.

“The cash further strengthens Kering’s balance sheet and gives additional cash for M&A,” analysts at Berenberg said in a note to clients. “This should not come as a surprise,” added the analysts, who estimated the amount of the sale at around 805 million euros.

Kering could raise 830 million euros in gross cash proceeds, according to analysts at RBC, who estimate that Kering could “comfortably” raise 15 billion euros in incremental borrowing, “providing meaningful firepower for potential M&A in the coming quarters.”

The RBC analysts added that management has been “consistent and clear in their willingness to conduct M&A and their preferred target profile,” noting it would be a well-known soft luxury brand with scale, rich archives and “clean” distribution network.

Kering has been gradually lowering its stake in Puma after spinning off 70 percent of the company to its shareholders in 2018 as part of a plan to focus on luxury activities.

The recent purchase of Tiffany by LVMH Moët Hennessy Louis Vuitton has added pressure on Kering to bulk up its activities. Scale has become increasingly important for actors in the high-end sector competing globally, which calls for steep marketing investments and leverage for negotiating prime real estate locations.

In early morning trading, Kering shares traded up 1.56 percent, or 11.30 euros, to 735.80 euros.