SMCP ownership battle heats up amid illegal stake transfer claim
08/12/2021 21:02
PARIS, Dec 8 (Reuters) - An ownership battle at SMCP
SMCP.PA heated up on Wednesday as major shareholders claimed a
16% stake in the French fashion group had been illegally
transferred to an offshore account, and a meeting to force a
boardroom reshuffle was called for next month.
The transfer was allegedly carried out by SMCP's previous
Chinese owner for the sum of 1 euro to an entity in the British
Virgin Islands belonging to current SMCP board member Chenran
Qiu, according to a statement issued Wednesday by Glas, a
company representing SMCP shareholders.
Glas, which includes asset manager Blackrock and an
affiliate of private equity firm Carlyle, said a commercial
court in Britain had issued a worldwide freezing order to
prevent the transfer of further SMCP shares.
Glas obtained a 29% stake in SMCP and 25% of its voting
rights following the default of bonds issued by European
TopSoho, a unit of the French group’s Chinese shareholder, the
conglomerate Shandong Ruyi 002193.SZ .
TopSoho did not respond to an email from Reuters seeking
comment on Glas's allegation.
Glas, which wants to sell its SMCP stake, has called for
changes on the board, including the removal of Chenran Qiu and
her father, board president Yafu Qiu.
SMCP said that, following a ruling by a Paris commercial
court in favor of Glas, it would hold a shareholder meeting in
January to vote on the proposed ouster of five board members.
All are linked to Shandong Ruyi, according to SMCP's website.
Shandong Ruyi harbored ambitions of creating a luxury
clothing empire and in 2015 embarked on a buying spree that, as
well as SMCP - bought from private equity firm KKR in 2016 -
included London-based suitmaker Aquascutum and Paris-based
fashion house Cerruti 1881.
But it has struggled under the weight of its debts and its
financial difficulties worsened with the COVID-19 pandemic.
SMCP, meanwhile, has seen a recovery, with third quarter
revenues back close to pre-pandemic levels.
(Reporting by Mimosa Spencer; editing by John Stonestreet)
((Mimosa.Spencer@thomsonreuters.com;))