Shandong Ruyi Group'S Financing Difficulties Eventually Abandoned The Bally Brand.

Two years after the announcement of a deal to buy Swiss luxury brand Bally, Ruyi group of Shandong may end up abandoning the brand because of its financing difficulties.

Reuters quoted four people and sources on Friday as saying that in early 2018, Shandong Ruyi Investment Holding Shandong Ruyi Investment Holdings (hereinafter referred to as "Ruyi investment") had not yet received financing for Bally's majority purchase of $600 million, while Bally International AG spokeswoman also acknowledged that the transaction had not yet been completed and said it would continue to be the only shareholder JAB Holding Co.. The latter has a very high investment rating, the two sides have established a strong relationship, and the brand's current financial situation is steady.

And JAB Holding Co. The private equity fund supported by the German Lehmann family is different. The expansion of Ruyi group in Shandong is mainly based on external financing. In the past two years, the vigorous deleveraging situation and the difficult predicament of the retail industry, Shandong Ruyi loomed in last year's debt crisis and finally got the state capital Jining city construction Investment Co., Ltd. (Jining city investment) at the end of last year. It's been a sad time.

At the end of October 2019, Jining city invested 3 billion 500 million yuan to acquire 26% stake in Shandong Ruyi Technology Group (hereinafter referred to as "Ruyi technology") and secured the market's troubled debt of Ruyi technology, especially the issue of US dollar bonds. The transaction said that Jining city voted "Ruyi 15" issued by Ruyi technology to guarantee the scale of its existence after the completion of the sale in October 2019.

Rui technology's most proud French light luxury group SMCP SAS (SMCP.PA) shares have been breaking new lows in recent years, with a minimum of 5.78 euros on Friday. Since the outbreak of the new coronavirus pneumonia has spread from China to the global scale, it has seriously affected the supply and demand ends of the consumer goods industry. As the main market of SMCP SAS, the group's Chinese market business has been seriously affected in the past two months.

At the end of 2017, SMCP SAS was IPO at market value of 22 euros or 1 billion 700 million euros per share, but as of Friday, the market value of the company was less than 450 million euros, and 54% of the stock market value was 230 million euros. In 2016, Ruyi technology spent 80% euros on SMCP SAS's revenue, which was 1 billion 300 million euros, even though it had some shares in IPO. However, the current market value of SMCP SAS still did not calculate the cost of financing in the past four years.

Due to the weakness of retail trade, in fact, investment in Ruyi technology has been almost unsuccessful in the past few years. At the beginning of 2017, the British 100 century brand Aquascutum Aquascutum, which cost 117 million US dollars from YGM Trading Limited, is also in a predicament. Its Portugal supplier Calvelex It is reported that the brand has been brought to court in Hongkong in mid 1, because Ruyi technology has stopped paying the company's bills since March 2019, and it currently owes about 182 thousand euros to Portuguese companies.

In 2010, Japanese technology giant Renown Inc. (3606.T), which controls Japan's apparel holdings through increased capital, learned that about 5 billion 300 million yen and 49 million US dollars were not recovered from Ruyi technology.

At the end of last month, Bagir Group Ltd. (BAGR.L), Israel's men's clothing group, said it was prepared to sue Ruyi technology, because the Chinese company did not complete the payment of the controlling transaction. At the end of 2017, Ruyi technology announced that it would buy 16 million 500 thousand of the 54% shares of the men's clothing group of Israel for 12 million 400 thousand US dollars to become the controlling shareholder of the company, but at present, Ruyi technology only pays about $6 million 500 thousand. As of Friday's close, the market value of Bagir Group Ltd. was only 2 million pounds.

Ruyi technology responded in response to Reuters's inquiry that it was discussing with Bagir Group Ltd. to solve the problem, while the debts owed to Portugal suppliers and Renown Inc. were mainly due to the serious impact of the COVID-19 epidemic, and the company is working hard to solve the problem.

If time goes back to early 2018, the competition for Bally is starry "south, North and North". The Limited by Share Ltd of Shenzhen Herme group (002356.SZ) is plunged into crisis in the early 2018 when China's stock market is down. The larger scale Ruyi technology will drag the crisis back for one year.

Under the aggressive expansion strategy, the market once compared "Ruyi technology" to "China's LVMH". Ruyi technology itself is also willing to compare itself. The latter is the world's largest luxury group LVMH Mo t Hennessy Louis Vuitton SE (MC.PA). The group received 53 billion 670 million euros in 2019, operating profit of 11 billion 504 million euros, and spent 16 billion 200 million dollars at the end of last year to acquire Tiffany, Co. (NYSE:TIF) Tiffany group, a landmark jeweler in the US.