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The Survival Of The Fittest, And The Stronger The Stronger, The Adjustment Strategy For The "Reverse Diversification" Clothing Enterprises.

2019/10/14 9:32:00 9

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Since the beginning of this year, clothing companies have been selling their brands, businesses, companies and other assets. It is not unusual for these enterprises to sell their products.

Hai Lan's home transfer to women's clothing company love rabbit

In September 16th, Hai Lan home announced the company's wholly owned subsidiary, Hai Lan Home Brand Management Co., Ltd., to sign the agreement on equity transfer of Jiangyin AI Ju rabbit Clothing Co., Ltd. with Zhao Fang Wei, the Jiangyin business partnership (limited partnership) and the wholly owned subsidiary of Jiangyin Hai Lan home investment Co., Ltd., with the valuation value of the target stock as the pricing basis, the quality control company will transfer the 66% equity interest of Jiangyin's AI Ju rabbit Garments Co., Ltd. to the Zhao Fangwei, the transfer price is RMB 252 million yuan, the transfer of the 15% share of the AI house rabbit can be transferred to the joint management, the transfer price is RMB 57 million 364 thousand and 900 yuan, and the 19% share of the AI rabbit can be transferred to Hai Lan investment, the transfer price is RMB 72 million 662 thousand and 200 yuan.

After the completion of the transaction, AI lived from a wholly owned subsidiary of the company to a share holding company. The company indirectly held 19% of its equity. The transfer is expected to bring a non recurrent one-time investment income of 56 million yuan to the listed company. The announcement shows that the transaction with Zhao Fangwei and the co management company is a related transaction, but it does not constitute a major asset reorganization of the listed company's major asset reorganization management measures.

The announcement shows that as of December 31, 2018, the total assets of AI lived 1 billion 186 million yuan, with a total debt of 433 million yuan and an asset liability ratio of 36.50%. In 2018, AI Ju achieved 1 billion 698 million yuan in operating income and 327 million yuan in net profit. By the end of August 31st this year, the total assets of AI rabbit were 1 billion 30 million yuan, the total liabilities amounted to 712 million yuan, the asset liability ratio was 69.15%, and the operating income was 1 billion 148 million yuan, and the net profit loss was 25 million 363 thousand and 800 yuan.

Hai Lan's home said that since its inception, after its brand positioning adjustment, the brand has failed to achieve its overall business performance. The company believes that adjusting the equity ratio of the AI rabbit, transferring the controlling shares to the core manager and management team of the brand can reduce the operating costs and operational risks of the company, reduce the inefficient input of resources and concentrate resources on the new brand with better development momentum.

La Natsu Bell sells electricity supplier subsidiary

In May 7th, La Natsu Bell issued a notice that the company intends to sell 54.05% stake in Agel Ecommerce Ltd, which is owned by Hangzhou Yan Er business management consulting Co., Ltd. (the company holds 100% stake in natural person Cao Qing), and the share transfer price of the transaction is 200 million yuan RMB. Because Hangzhou is a controlling subsidiary of the company, and Cao Qing directly owns 23.86% stake in Hangzhou, the transaction constitutes a related transaction and does not constitute a major asset reorganization.

The announcement shows that Hangzhou was founded in January 2010. It mainly sells and sells online clothing brands such as seven grid, OTHERMIX and OTHERCRAZY. As of December 31, 2018, the total assets of Hangzhou were 390 million yuan, the net assets were 300 million yuan, and the operating income was 504 million yuan in 2018, achieving a net profit of 64 million yuan. La Natsu Bell said that this transaction is conducive to the company's withdrawal of funds, and helps the company's strategic focus and brand integration.

La Natsu Bell's 2019 semi annual report showed that the first half of the company achieved operating income of 3 billion 951 million yuan, down 23.16% compared with the same period last year. The net profit attributable to shareholders of listed companies was 498 million yuan, down 311.2% from the same period last year. In addition, La Natsu Bell's retail outlets decreased by 2470 in the first half of this year, a net decrease of 26.65% compared with the end of 2018. La Natsu Bell said that the company adopted a contraction strategy in the first half of the year, with the main women's clothing brand as the core, and contracted the development scale of men's clothing brand Pote, JACK WALK and MARC ECK. For other brands of the company to improve profits as the core, shrink the scale of business development. Affected by the company's contraction strategy, slow growth in consumption and reduced passenger flow in physical stores, the company's main women's clothing brands La Chapelle, Puella, 7 Modifier and La Babit were down more than 20% year-on-year.

Selling toys business

In May 14th, the company announced that it would sell all of its British Toy retailer Hamleys to Reliance Brands Limited. In addition to paying 34 million 290 thousand of the total equity interest in Hamleys, Reliance Brands Limited also paid 33 million 670 thousand pounds to the company to repay the loan provided by the company to Hamleys, which amounted to 67 million 960 thousand pounds. In 2015, it bought Hamleys at the price of about 100 million pounds. The announcement shows that as of December 31, 2018, sales in the 2018 fiscal year of Hamleys were 62 million 880 thousand pounds, down 5.1% from the same period last year, and net profit was 2 million 400 thousand pounds, which was 11 million 200 thousand pounds in the same period last year. Under the agreement, Hamleys will continue to own the franchise of three stores in China in the next 20 years.

In its announcement, the company said that since its acquisition of Hamleys at the end of 2015, Hamleys's performance has been lower than expected. The synergy between the core footwear business and the toy business has not been realized, nor the anticipated diversification of the group business. In addition, the pessimistic business environment of the British retail market has deteriorated in recent years. In view of the fact that Hamleys's main business is focused on the UK, Hamleys will inevitably suffer from the impact of the UK and the macroeconomic downturn even if it enjoys global reputation. The company has sought to sell its toy business since the end of 2018 in view of the difficulties in operation, the uncertain prospect of Hamleys and the failure to display its business diversity. The sale will release the group's resources to invest in Hamleys, so that the group can focus on the development of high-end ladies' shoes in its core business.

After completion of the sale, the group will focus on and allocate its resources to shoe business. The sale will enable the company to focus on its own brand, namely, "100 degrees", "Iraqi companion", "Sun Dance", "Mio" and "BADGLEY MISCHKA". In addition, the company will allocate the resources needed to enhance its role as OEM or ODM supplier as an international shoe company.

Modern Avenue sells headquarters again

In August 7th, the modern Avenue announced that the company intends to sign the purchase agreement with the Guangzhou Jian Kang Sports Culture Development Co., Ltd. and the modern Boulevard fashion group Limited by Share Ltd on the modern Avenue headquarters building with the Jian Kang Sports Culture Development Co., Ltd. of the city of Guangzhou. It intends to sell the assets of relevant land use rights and ground buildings at 23 of the spectrum Road, Whampoa Science City, Guangzhou, to the cultural development company. The total transfer price of the target assets is RMB 975 million yuan (including VAT).

Modern Avenue said that this can promote the development of main business, revitalize the existing assets of the company, and ensure that the company's funds are used for production and operation activities. The transaction is expected to achieve a profit of about 1000 to 30 million yuan. In addition, this transaction may cause the income of the company's high-tech products to be less than 60%, which leads the company to lose the qualification of high-tech enterprises.

This is the modern Avenue "another" sale of the headquarters building. In October 2018, morden Avenue issued a major asset restructuring plan. The company intends to sell its 100% stake and its related assets and liabilities to Ruifeng group. According to the announcement, the estimated value of headquarters related assets was about 1 billion 520 million yuan at that time.

Modern Boulevard said in its announcement that the headquarters assets of the company are mainly office buildings and art galleries. In view of the large scale assets of the company's headquarters and the higher cost of depreciation and amortization after completion of the assets, according to preliminary estimates, the office space usage fee (including property management fees, utilities and so on) and office space depreciation fees were 9 million 180 thousand and 500 yuan in the 1-6 months of 2018 when the company moved to the new headquarters office, which increased by 4 million 353 thousand and 200 yuan compared with the same period in 2017. At the same time, headquarters related assets as the company's own property, the annual depreciation and amortization cost is 23 million 36 thousand and 500 yuan, which is not conducive to enhancing the company's continued profitability. However, in November 2018, morden Avenue issued a notice that the sale of the headquarters building was terminated due to the fact that the real estate property certificate of headquarters building had not yet been completed.

Yuyuan group merger way to sell clothing company TCHC

In May 7th, Yuyuan group issued a notice that on the same day, the company's indirect Grand Wealth Group Limited, as a seller, Texas Clothing Holding Corp. (TCHC), merged Affiliated Companies Kinston Merger Merger, the buyer, the buyer guarantor and the company concluded a merger agreement. The contracting parties agreed to merge the Affiliated Companies into the merger under the Delaware law. The buyer's guarantor and the buyer agreed to give the seller a guarantee on the proper, full and timely payment of the monetary liability of the merger agreement. The company has agreed to guarantee the seller's proper, full and timely payment of the monetary liability of the merger agreement. According to the merger agreement, the sale share must be converted to the right to charge the combined price. The combined price is composed of the purchase price and the royalty rate, of which the purchase price is $230 million. Immediately after completion, the TCHC group will no longer be the Affiliated Companies of the company, while the financial performance of the TCHC group will no longer be incorporated into the group's financial statements.

The announcement shows that TCHC is a company incorporated in Delaware. TCHC group is mainly engaged in the design, import and sale of garments in the United States. In 2017 and 2018, net profit after tax was $15 million and $17 million 80 thousand respectively. Yuyuan group said its main business is to manufacture and distribute sports shoes, sports casual shoes, casual shoes and outdoor shoes. This merger involving sale will be beneficial to the group, because the group can cash in its TCHC investment, and the sale is part of the company's continued focus on core business development. The Group expects to confirm revenue from sale items (excluding transaction expenses) of about $3 million.

Yuyuan group's interim report in 2019 showed that the company's revenue increased by 6.32% in the 6 months ended June 30, 2019, compared with the same period last year. The company's owners should earn 166 million dollars in profit, up 10.52% from the same period last year.

The "shrinkage" and "focus" strategy behind the sale of assets in clothing enterprises

This year, clothing companies sell their brands, businesses, companies and other assets are not uncommon. The above list of Hai Lan's home transfer women's clothing company love rabbit, La Natsu Bell sell electricity supplier subsidiary Hangzhou dark, sell the toy store business of its mergers and acquisitions, sell the assets of the headquarters building again, and the footwear manufacturer Yuyuan group merger way to sell its American clothing company TCHC and other examples are all these actions reflect.

One of the common reasons for these clothing enterprises to sell assets is to increase the efficiency of resource utilization and concentrate more resources on the main business of the company. Therefore, most of the brands and businesses sold by these garment enterprises are considered "non core" assets. The sale of women's clothing by Hai Lan's home, La Natsu Bell's sale of electricity supplier subsidiaries, the sale of toys business by thousand degrees, and the sale of clothing subsidiaries by Yuyuan group show that the brands and businesses sold by these companies are not the core businesses of the company. Some businesses, which were previously purchased by the company, are generally considered part of the diversified business of the company, so these selling actions are similar to a trend of "anti diversification".

These "reverse diversification" actions reflect the contraction and focus development strategy adopted by some garment enterprises this year. Influenced by the macro-economic operation, the pressure of business performance, the rising cost of enterprise operation, and even the need for transformation and upgrading of enterprises themselves, the clothing enterprises intend to achieve the goal of returning more capital, improving the efficiency of resource utilization, improving the quality of listed companies' assets (many sales actions belong to related transactions), raising the qualification of financing and enhancing the competitiveness of the main industry by stripping off non core assets or relatively inferior assets. In fact, for garment enterprises, contraction is not a retreat, focusing is also for better expansion. "Buying" and "selling" are normal actions for enterprises to survive and develop. In the increasingly competitive market environment, the fittest survive and the stronger the stronger.