View all newsletters
Receive our newsletter – data, insights and analysis delivered to you
  1. News
February 25, 2019

China Fosun in takeover bid for Tom Tailor

By Hannah Abdulla

Chinese conglomerate Fosun International has announced a takeover bid for German clothing retailer Tom Tailor, further expanding its reach into Europe’s fashion sector.

Free Whitepaper
img

What is the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry?

While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
  • Which multinational companies have been affected?
  • What is the effect of lockdowns on foodservice?
  • What is the effect of lockdowns on Chinese ports?
  • Spotlight on Shanghai: what is the situation there?
  • How have Chinese consumers reacted?
  • How might the Chinese government react?
  • What are the potential growth opportunities?
by GlobalData
Enter your details here to receive your free Whitepaper.

In a statement, Fosun said it is increasing its stake in the company to 35.35%. As this is over a 30% threshold it triggers a mandatory takeover offer under German law.

The registration of the capital increase was made with the commercial register of the local court (Amtsgericht) of Hamburg, Germany, last week. Upon the completion, Fosun holds an aggregate of 14,969,521 Tom Tailor Shares.

Tom Tailor said it would use the net proceeds, which is understood to be about EUR8.6m (US$9.8m), to support the ongoing restructuring measures at its subsidiary Bonita, as well as to improve the equity and financing situation.

The Tom Tailor brand is marketed through retail and wholesale channels including 453 Tom Tailor stores and 185 franchise stores, 2,510 shop-in-shops and 7,082 multi-label points of sale.  The brand is present in more than 31 countries. Along with its 772 retail stores, Bonita has 82 shop-in-shop spaces.

The Hamburg-based firm has been struggling with tough conditions as consumers increasingly shop for shoes and clothes online. In its first-half financial results, group sales fell 1% to EUR399.3m but it did manage to post a profit of EUR2m from EUR0.1m in the prior year which it attributed to progress in its turnaround drive.

In 2016 it announced Reset, an initiative aimed at reducing costs, increasing efficiency and expanding the range of products and services offered through e-commerce in order to get the group back on track for profitable growth.

“The Tom Tailor Group is entering a challenging year in 2019, in which we intend to further strengthen growth in our core Tom Tailor brand in a difficult environment and consistently push ahead with the restructuring of our subsidiary Bonita, making an important step forward with this capital increase,” said Heiko Schäfer, chairman of the executive board of Tom Tailor Holding. “The fact that Fosun fully subscribes to the new shares, we see as a vote of confidence in our chosen course.”

“We welcome the commitment and long-term support of our anchor shareholder Fosun”, added Thomas Dressendörfer, chief financial officer of Tom Tailor. “Fosun is a strong strategic partner, and is apparently ready to take on more responsibility for Tom Tailor. We see this as a vote of confidence in the company and in the path we have taken. We also see it, however, as a clear signal to our investors and the capital market that Tom Tailor is well equipped for the still challenging environment.”

Related Companies

Free Whitepaper
img

What is the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry?

While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
  • Which multinational companies have been affected?
  • What is the effect of lockdowns on foodservice?
  • What is the effect of lockdowns on Chinese ports?
  • Spotlight on Shanghai: what is the situation there?
  • How have Chinese consumers reacted?
  • How might the Chinese government react?
  • What are the potential growth opportunities?
by GlobalData
Enter your details here to receive your free Whitepaper.

Topics in this article:
NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Monday. The industry's most comprehensive news and information delivered every quarter.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Just Style