Chinese sportswear retailer Pou Sheng Int'l receives $1.4 bln privatisation offer (updated)

POU CHEN

21/01/2018 12:25

(Adds details, background) 
    By Kane Wu 
    HONG KONG, Jan 21 (Reuters) - Chinese sportswear retailer 
Pou Sheng International (Holdings)  3813.HK  Ltd has received a 
proposal from Pou Chen Corp to be taken private that values it 
at around $11 billion ($1.4 billion), it said in a stock 
exchange filing on Sunday. 
    Pou Chen Corp has offered Pou Sheng International a 
cancellation price of HK$2.03 per share, which represents a 
premium of around 31.82 percent over Pou Sheng's last closing 
price.  
    Pou Sheng International shareholder Yue Yuen Industrial 
(Holdings) Ltd  0551.HK  will sell its 62.41 percent stake in 
Pou Sheng to Pou Chen as part of the proposal at the 
cancellation price for a total of HK$6.8 billion, according to 
the stock filing. Pou Chen owns 49.99 percent of Yue Yuen 
Industrial. 
    The move follows a similar transaction last April, when a 
consortium led by private equity firms Hillhouse Capital Group 
and CDH Investments offered to buy out Hong Kong-listed Belle 
International Holdings Ltd in a $6.8 billion deal, as retailers 
seek new growth from e-commerce channels and tackle competition 
from online rivals.  urn:newsml:reuters.com:*:nL4N1I047I 
    The proposal said the sporting goods industry "is 
experiencing unprecedented changes and challenges" from the rise 
of online shopping which has changed customers' expectations and 
increased market competition. 
    Pou Sheng International would need "significant investments" 
to transform its business and would have flexibility and more 
advantageous financing if it were to be taken private, according 
to the proposal.     
    The boards of Pou Chen and Pou Sheng believe Pou Sheng's 
listing status is ineffective in providing a sufficient source 
of funding for the company's business and growth, the proposal 
said. 
    Pou Chen, a leading Taiwanese footwear manufacturer, will 
not increase the offer price, according to the stock filing. 
    Citigroup is acting as financial advisor to Pou Chen. 
 
 (Reporting by Kane Wu; Editing by Susan Fenton) 
 ((kane.wu@thomsonreuters.com; +85228436590; Reuters Messaging: 
kane.wu.thomsonreuters.com@reuters.net)) 
 
Keywords: HONG KONG PRIVATIZATION/