Fortune Fountain Capital, a financial group established by the Wang Xizhi family of Hong Kong and Mainland China, has made an irrevocable offer to acquire 88.8% of French luxury crystal brand Baccarat, from affiliates of private equity firms Starwood Capital Group and L Catterton.
Under terms of the deal, Fortune Fountain would acquire Euronext-listed Baccarat for €222.7 per share, or an aggregate price of around €164 million (US$185 million). Closing of the purchase would be followed by the filing of a mandatory tender offer for all remaining outstanding Baccarat stock at the same price per share, the firms announced.
At this stage, Fortune Fountain does not intend to have Baccarat delisted from Euronext Paris, the firm said. However, depending on the outcome of the tender offer process and what is deemed in the best interest of Baccarat, the new owner may reconsider its position and implement a "squeeze-out" procedure that would in effect force out remaining shareholders.
"We are convinced that (Fortune Fountain Capital)…is an ideal strategic partner to position Baccarat for future growth and value creation," said Coco Chu, chairlady of Fortune Fountain. "We attach the greatest importance to maintaining this company's 250-year history of excellence, and most notably its 'Made in France' identity."
Best known for its fine crystal ornaments, jewelry and tableware, Baccarat was founded in 1764 and has its artisanal manufacture based in the commune of Baccarat in the Lorraine region of Eastern France.
The deal, which is subject to both French and Chinese regulatory approvals, will enable Baccarat to accelerate its strategic international expansion, especially in the Chinese market.
Baccarat's current hotel license agreement with Starwood Capital Group's affiliate will be maintained in the framework of a partnership between Baccarat, Fortune Fountain and Starwood Capital Group. The license to operate and brand Baccarat Hotels has been retained by Starwood Capital Group's controlled affiliate.
"We share the same vision for the future of our business, especially regarding the expansion into new products and geographies, such as Asia and North America," said Daniela Riccardi, chief executive officer of Baccarat. "We will benefit from (Fortune Fountain)'s financial strength and expertise in these markets, as well as from its extended base of partners and clients in the luxury industry."
Fortune Fountain's major shareholder comes from the family of Wang Xizhi, one of the most famous calligrapher in Chinese history. The firm serves a wide network of high-net-worth individuals and distinguished families, offering financial products and services, as well as luxury experience and lifestyle services such as high-end travel, artwork, private jet charter and golf tournaments.