Anta Wants To Sell Its Brand Precor For $500 Million.

According to people familiar with the matter, Anta sports has received contact enquiries from potential buyers before considering the sale of its brand Precor Inc..

The Chinese giant sportswear maker is cooperating with a consultant on the possibility of selling the US business, which may cost about $500 million, according to a person who asked for anonymity because of a discussion. Several companies and private equity funds have expressed initial intent to acquire Precor, people familiar with the matter said.

Precor focuses on the design and manufacture of fitness products, such as indoor bicycles, treadmills and elliptical machines. Anta acquired the Precor brand at the same time.

Although Anta hopes to build and expand most brands acquired by amamfin, fitness equipment is not the core asset of its growth strategy.

One insider said that the sale process of Precor could start as early as next year, and the discussion is still in its early stage, and it is not certain that an agreement will be reached. At present, Anta will not comment.

Indeed, the pressure on Anta is not too small. The acquisition of amamin sports led to a significant increase in Anta's debt ratio.

According to Anta's interim data this year, the company's debt ratio rose from 6% last year to 22.8%, mainly due to a large increase in bank loans. The loan amount increased from HK $1 billion 236 million to HK $7 billion 568 million. Loans were mainly used to acquire amamin sports.

Just in the past 12 days, Anta sports sold 1 billion 198 million of the indirect benefits of the company's 1 billion 198 million indirect interest. After the transaction, Anta sports holds the voting rights of Amer Sports57.7% and enjoys 52.7% economic benefits.

The buyer is mainly composed of four families, namely, Chao Hong (2.67%), Jin Fu (0.83%), Sequoia SPV (1.13%) and ZWC capital (0.38%). Of course, this transfer is regarded as "a transaction of one's own family".

Among them, behind Anta is four executive directors of Anta sports, Ding Shizhong, Lai Shixian, Wu Yonghua and Zheng Jie. The four will invest 71 million 200 thousand euros in their own capital to acquire Amer Sports2.67%.

Behind the company is Anta's top management team, which will invest 22 million euros to buy shares in Amer Sports0.83%.

Sequoia SPV and ZWC capital are the newly introduced strategic alliance. Sequoia Capital has a high reputation in business, and has rich investment experience and resources in the field of consumer goods in China. ZWC capital focuses on consumption and TMT industry.

The sale of Anta's own family has also attracted the attention of the market. The indirect sale of 5.2517% shares, according to Anta's then purchase price of 2 billion 668 million euros, the corresponding valuation reached 240 million euros.

If the selling price of the euro is 133 million euros, the sale price of the 5.2517% stake will drop by 44.6%. That is to say, Anta only sold at a discount of about 140 million euros, and Anta did not give a detailed explanation.

This year, Anta's share price rose 102% in Hongkong. It is a better stock in Hang Seng China enterprise index. As of Monday, Anta's market capitalization was about HK $202 billion (US $26 billion).

According to Precor's introduction, the company was founded in 1980 and is headquartered in Washington, Washington, and has launched its first cushioning treadmill. The company provides products for fitness clubs, hotels and schools in more than 90 countries.

It can only be said that the business of Precor fitness equipment is the least favored by Anta. Anta combined with other consortia to purchase amamwin sports costs 4 billion 600 million euros, and the bid price is 40 euros at the time of takeover. At that time, the stock price of amamwin sports was only 30 euros.

Anta has invested heavily in the acquisition of amamin sports, which has brought a lot of financial pressure to Anta, and the pressure of late operation is also not small. Anta also said in the announcement that this transaction can optimize the group's balance sheet.