Kering Sells Puma

Kering plans to sell off German sports brand Puma to its shareholders to focus on its high-end brands.

In an exclusive Reuters report, Kering said it planned to retain a 16% stake in Puma, and distribute 70% of shares to its investors. Kering bought Puma in 2007 for €5.3 million after struggling for years with brand identity (sports vs fashion brand) and weakening sales, and remaining sportswear label Volcom could be next.

Kering's finance chief Jean-Marc Duplaix said,

"We found ourselves in a sort of imbalance, linked to the out-performance of the luxury sector…The contemplated distribution of Puma shares to our shareholders would be a significant milestone in the history of the group”

The price of the transaction, which will be put to Kering shareholders on April 26 at the group's annual meeting, has yet to be determined. Exane analyst Luca Solca told Bloomberg he estimates the ratio should be about one Puma share for each 12 of Kering. Artémis, who holds 41% of Kering shares, would then become a “long-term strategic shareholder” in Puma, with an ownership stake of about 29%. The number of Puma’s publicly traded shares would be increased to around 55%, a statement from Kering said.

Kering have been reaping the benefits of the luxury goods renaissance in recent years – Gucci reported a 43.4% increase in sales in the first six months of 2017 and YSL a sales increase of 28.5%.

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