Review Of The Acquisition Of Clothing Fashion Industry In 2019

Speaking of Tiffany, in addition to the well-known 1961 Audrey Hepburn movie "breakfast of Tiffany", I may have to mention the legendary Tiffany diamond.

In 1877, the original stone of Tiffany legendary Huang diamond was discovered in South Africa, and was purchased by Tiffany founder the following year. The original stone, weighing 287.4 grams, was finally presented with a 128.54 carat pillow yellow diamond. The 82 sections were not only unprecedented, but also raised the Tiffany brand influence to a high point.

Over the past 180 years, Tiffany has been constantly creating standards and innovation, and is in a high position in the high-end jewelry industry. However, jewelry with a long history and noble nobility can not be eliminated by the times.

The first half of 2019 showed that the sales data of several major brands of the brand had declined to varying degrees. Among the largest American markets, sales fell by 4% compared with the same period last year, while same store sales fell 5% year-on-year. Poor performance of the market, let Tiffany constantly seek opportunities for change and rise.

Until November 2019, Tiffany, who loved the feather, caught the olive branch from LVMH.

　　 Annual acquisition of the world's top list: Tiffany & LVMH Win-win

The top of the list of fashion and fashion industry in 2019 is LVMH&Tiffany.

Luxury goods giant LVMH bought Tiffany at a high price of 16 billion 200 million dollars. This 2019 year acquisition of the big incident fully embodies the LVMH group's "trench" inhumanity. The first news came out at the end of October. At that time, Tiffany's market capitalization was only 12 billion dollars, which occupied the American jewelry market all the year round, and began to show its strength in the Chinese market in recent years. The LVMH group's masterpiece is known for many years. In 2017, the $7 billion 100 million acquisition of Dior group has never stopped buying and buying in the luxury sector.

Prior to the acquisition of Tiffany, LVMH Group acquired three high-end jewelry brands from Bvlgari, Shang Mei and Fei Deng through acquisition. But in the group's performance, the proportion of high-end jewelry is not high, and its business growth is still showing unlimited potential. At the same time, the world's largest luxury brands group, the jewelry business of the rival luxury group, occupied 51% of the total revenue in 2019, and brought huge revenue to the group. Only the value of the two brands created by Cartire and Van Cleef & Arpels exceeded the total of LVMH jewelry watches. LVMH group urgently needed to expand its strength in the jewelry watch area.

In addition to improving the strength of jewelry watches, the LVMH group's abacus has also hit the two largest markets in China and the United States. Tiffany is a major feature of LVMH's existing jewellery brand. Tiffany accounts for 44% of its sales in the US, and about more than 100 of its more than 300 stores are located in the United States. The Chinese market is one of the highlights of Tiffany in recent years. In the three quarter earnings report recently released, mainland China's sales performance in the third quarter and the first 9 months achieved two digit growth.

Agreeing to the $16 billion 200 million acquisition, Tiffany also has its own consideration. In order to attract and satisfy the needs of the younger generation, Tiffany has introduced some more affordable products, which have impacted on the brand positioning and value. Joining the LVMH group that started in Europe has given Tiffany the opportunity to reinventing the high-end brand positioning, and also given Tiffany the opportunity to reach the European market.

It can be said that the biggest acquisition in 2019 is a win-win situation.

　　 China's top list of annual acquisitions list: Anta & Amamwin breaks the border.

34 billion 800 million yuan, which lasted for 3 months.

Although Anta announced that the acquisition of amamfin was announced at the end of 2018, it was officially concluded that in March 2019, it could be said to be a cross year acquisition.

Amamfin sports has a history of more than 60 years. Its brand includes Salomon, eulogy, Ato Mick and song Tuo, among which the first eulogy is the most famous Canadian brand. The main revenue contribution of amamfin sports is from Europe and America, while the Asia Pacific region accounts for less than 15%. But in recent years, the Asia Pacific region's revenue growth rate ranked first in the growth rate of 10%, while Europe's 8% growth rate was less than that of the Asia Pacific region, and the Americas only 4%.

On the contrary, Anta, on the road to maintaining rapid growth, is riding on the dust and showing signs of sprint to top international sports brands. It has opened up domestic sports brands such as Lining, XTEP and 31st degree. 10 years ago, Anta acquired FILA's trademark rights and operation rights in China at HK $600 million. After 10 years, the number of stores in FILA Greater China has reached 1788, with a market share of nearly 3%. In October 2019, Anta's market value exceeded two hundred billion Hong Kong dollar mark and became the top of the domestic sports group. But where is Anta's boundary?

The domestic market may be the boundary of Anta. The acquisition of a mature and dominant market in the European and American markets has given Anta the chance to tear the border. Ding Shizhong, chairman of Anta group, said that the acquisition of amamin sports mainly focused on the growth space of the Chinese market and the two factors of its sales scale in China.

It is understood that before the acquisition of amamin sports, Anta group in the sports market segmentation is not perfect. The brand of amamfin sports brand just makes up for this weakness of Anta, and it can also push Anta to differentiate itself from internationally famous sports brands such as Nike and Adidas through differentiation, forming its own advantage and forming brand advantage.

But debt is hard to carry. Even Anta can hardly afford huge debts. The mid year report showed that Anta's debt ratio rose from 6% to 22.8%. In November 2019, in order to reduce the debt ratio and divest the non core businesses, Anta announced the sale of its fitness equipment brand Precor and 5.2517% of the indirect rights and interests of amamin sports, in order to obtain more cash flow, cope with the market downturn, and enable the group to return to the blood quickly and focus on the main business.

To the outside world, it is still unknown whether Anta can reproduce a Fiat. But Anta is making changes precisely and accurately. A few days ago, Anta announced the development blueprint of amamin. It used 4 to 5 years to raise the growth rate of amamin's sports revenue to 10%-15, and led its brand of eBird, Salomon and Wilson into the "one billion euro brand" mark, pointing out that the international giants Nike and Adidas. Moreover, Anta officially launched the global retail headquarters, Anta center in Shanghai in late December, laying the groundwork for the globalization of the group.

We may as well look forward to it. In the future, Anta's amamin sports will also become the target of the tide.

To write this, the story of two big guys in the 2019 annual acquisition list can be put to an end. But in the coming year, there are many acquisitions that consumers, market and investors are concerned about, and Nike is the leader. Digital demon Nike is no longer on the road to improving its digital strength, and its technological content is also increasing. In October, Nike acquired the Seattle sports content platform to fill its digital strength and create a brand new marketing and business platform. As early as 2017, Nike executives said publicly that the overall performance of the direct layout should be promoted through comprehensive digital layout. Until the recently announced 2020 quarter fiscal year two quarter earnings, the advantage of digital empowerment can still bring enough growth power to them.

No brand will survive. Behind the huge growth of Anta and Lining, XTEP, the domestic sports brand, is determined to make more brand matrix. So XTEP bought E-Land Footwear USAHoldings Inc. quickly, and won K-Swiss, Palladium and Supra brands.

The future is unknown, but it can be expected. In 2020, let's look forward to the protagonists of these events.