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This was lifted from yesterday's Straits Times:
LVMH offers to buy S'pore supplier of croc skins
Top French luxury brand LVMH has set its sights on a little-known but decidedly exotic family-run firm in Singapore, in a deal worth $161 million.
For four generations, the Koh family has quietly built up Heng Long International into one of the five largest crocodile skin tanneries in the world. Even though the firm is barely known here, LVMH has noticed its success and is keen to get a bite of the action. The French brand makes luxury fashion, leather goods, cosmetics and watches sold at thousands of outlets around the globe.
Yesterday, Heng Long announced that LVMH has offered to buy the company. The Koh family, which together owns about 74 per cent of Heng Long, has already agreed to accept LVMH's offer.
After the deal, the Koh family will reinvest part of the proceeds to take a 49 per cent stake, with LVMH owning the remaining 51 per cent.
Heng Long supplies crocodile, alligator and other exotic skins such as ostrich and python to high-end luxury brands such as Hermes, Prada and Louis Vuitton. The firm, listed on the Singapore Exchange (SGX), also makes alligator-hide watch straps for Swiss timepieces.
Heng Long handles about 250,000 skins a year. They arrive here from places such as the US, Zimbabwe and Australia. Heng Long is long of only two independent tanneries out of the five top ones, and the only one in Asia. The other three tanneries are owned by luxury fashion houses. It is also the world's only publicly traded firm dealing in tanning exotic skins, after listing on the SGX in July 2008.
The business started in the 1950s at the back of the Koh family's home. It was founded by the grandfather of the current managing director Koh Chon Tong, 60. Heng Long now has more than 6,000 sq m of production space in Defu. Mr Koh's younger brother Choon Heong, 58, is the executive director.
Mr Koh Chon Tong's son Ethan, at 25, has already forged a name for himself in London with a thriving bespoke luxury handbag label Ethan K. The crocodile and ostrich skins Mr Ethan Koh uses in his designs are - naturally - from Heng Long.
He told The Straits Times last night he thought the LVMH deal was "definitely a positive thing". "LVMH is one of the largest luxury groups... and Heng Long has the best supply of crocodile skins in the world. With more capital influx, it will allow us to strengthen our capabilities."
Even after the deal, Heng Long will remain "very much in the family" as its management will be unchanged, he said.
Mr Koh Chon Tong and Mr Koh Choon Heong have agreed to stay on in their current positions for at least five more years. Heng Long was "widely recognised for its tanning and finishing expertise and craftsmanship," LVMH said in a statement. It called the deal an "excellent fit between two partners who share demanding standards for sustainable development and conservation of wildlife species".
LVMH has offered 60 cents apiece for Heng Long shares, through an investment holding company owned by LVMH's Asia-Pacific arm in Hong Kong. Heng Long has about 268 million shares, valuing the firm at about $161 million. The offer represents a 7 per cent premium over Wednesday's closing price of 56 cents, the last full day of trading.
Last year, LVMH's private investment arm L Capital Asia bought a 20 per cent stake in home-grown shoe retailer Charles and Keith.
.. happy reading ..
LVMH offers to buy S'pore supplier of croc skins
Top French luxury brand LVMH has set its sights on a little-known but decidedly exotic family-run firm in Singapore, in a deal worth $161 million.
For four generations, the Koh family has quietly built up Heng Long International into one of the five largest crocodile skin tanneries in the world. Even though the firm is barely known here, LVMH has noticed its success and is keen to get a bite of the action. The French brand makes luxury fashion, leather goods, cosmetics and watches sold at thousands of outlets around the globe.
Yesterday, Heng Long announced that LVMH has offered to buy the company. The Koh family, which together owns about 74 per cent of Heng Long, has already agreed to accept LVMH's offer.
After the deal, the Koh family will reinvest part of the proceeds to take a 49 per cent stake, with LVMH owning the remaining 51 per cent.
Heng Long supplies crocodile, alligator and other exotic skins such as ostrich and python to high-end luxury brands such as Hermes, Prada and Louis Vuitton. The firm, listed on the Singapore Exchange (SGX), also makes alligator-hide watch straps for Swiss timepieces.
Heng Long handles about 250,000 skins a year. They arrive here from places such as the US, Zimbabwe and Australia. Heng Long is long of only two independent tanneries out of the five top ones, and the only one in Asia. The other three tanneries are owned by luxury fashion houses. It is also the world's only publicly traded firm dealing in tanning exotic skins, after listing on the SGX in July 2008.
The business started in the 1950s at the back of the Koh family's home. It was founded by the grandfather of the current managing director Koh Chon Tong, 60. Heng Long now has more than 6,000 sq m of production space in Defu. Mr Koh's younger brother Choon Heong, 58, is the executive director.
Mr Koh Chon Tong's son Ethan, at 25, has already forged a name for himself in London with a thriving bespoke luxury handbag label Ethan K. The crocodile and ostrich skins Mr Ethan Koh uses in his designs are - naturally - from Heng Long.
He told The Straits Times last night he thought the LVMH deal was "definitely a positive thing". "LVMH is one of the largest luxury groups... and Heng Long has the best supply of crocodile skins in the world. With more capital influx, it will allow us to strengthen our capabilities."
Even after the deal, Heng Long will remain "very much in the family" as its management will be unchanged, he said.
Mr Koh Chon Tong and Mr Koh Choon Heong have agreed to stay on in their current positions for at least five more years. Heng Long was "widely recognised for its tanning and finishing expertise and craftsmanship," LVMH said in a statement. It called the deal an "excellent fit between two partners who share demanding standards for sustainable development and conservation of wildlife species".
LVMH has offered 60 cents apiece for Heng Long shares, through an investment holding company owned by LVMH's Asia-Pacific arm in Hong Kong. Heng Long has about 268 million shares, valuing the firm at about $161 million. The offer represents a 7 per cent premium over Wednesday's closing price of 56 cents, the last full day of trading.
Last year, LVMH's private investment arm L Capital Asia bought a 20 per cent stake in home-grown shoe retailer Charles and Keith.
.. happy reading ..
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