GPs sell French crystal maker to Chinese investment group
Chinese investment group Fortune Fountain Capital has agreed to buy a controlling stake in French luxury crystal maker Baccarat from Starwood Capital and L Catterton Partners, in a deal worth EUR164 million ($184 million).
According to a filing dated June 2, Fortune Fountain will acquire an 88.8% stake in the Paris-listed company at EUR222.7 per share, representing a 14% discount to the previous closing price. The Chinese group said it will offer the same price to other shareholders but it has no plans to de-list the company. The deal is subjected to regulatory approvals.
Baccarat, founded in 1964, manufactures fine crystal glassware used for tableware, jewelry, lighting, and decoration from its base in north-east France. The company is known for sets of six champagne glasses that cost as much as $990. It also owns two museums in France showcasing crystal art pieces.
Starwood Capital took over Baccarat in 2005 and L Catterton bought a stake in 2012. When the deal was announced, Starwood and L Catterton held 66% and 22% of the company, respectively.
Asia is Baccarat's largest market, followed by Europe and the US, but sales have been declining in recent years. In 2016, revenue reached EUR148.3 million, down from EUR149.7 million the previous year. Net profit came to EUR2.3 million; the company posted a loss in three of the four years before that.
Baccarat said the acquisition will help accelerate global expansion, particularly in Asia and the Middle East, while supporting growth in developed markets. Fortune Fountain will invest in the business and maintain the current production base and staff.
Fortune Fountain was established in 2011 as a family office by the descendants of Wang Xizhi, one of the most famous calligraphers in Chinese history. It has evolved from a family wealth management operation into a financial holding company, focusing on financial, industrial and securities investments.
Fortune Fountain claims to have offices in 36 Chinese cities and total assets under management of RMB50 billion ($7.36 billion). It has invested a total of RMB30 billion. Between 2015 and 2016, the group participated in the privatization deals of companies Focus Media and Qihoo360, as well as acquiring Honey New Zealand, a company that produces Manuka honey.
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