Yahoo Finance Michael Kors looks to walk off with Jimmy Choo in £900m deal
Michael Kors, the US handbag maker, has made an offer to snap up luxury shoe brand Jimmy Choo in a £896m deal.
The proposed sale of Jimmy Choo, which rose to prominence after being regularly featured in US TV show Sex and The City, follows an auction process that was kicked off in April by majority owner JAB Holdings, the investment vehicle of the wealthy German Reimann family, which owns a near-68pc stake in the London-listed company.
JAB has recently been shifting its focus away from high-end goods and towards its interests in coffee and sandwiches after sealing billion dollar takeovers for Douwe Egberts coffee and US bagel chain Panera Bread.
Michael Kors made the move for Jimmy Choo after losing out in a takeover tussle with Coach to buy accessories firm Kate Spade earlier this year. It is the New York-based fashion company's first takeover since listing in 2011.
Michael Kors is offering 230p-a-share, a 36pc premium compared to the 168.5p share price the day before Jimmy Choo's parent JAB announced it would launch a formal sale process. The company floated at 140p-a-share in 2014.
JAB has undertaken to vote its shares in favour of the takeover, which will be structured as a scheme of arrangement, which requires 75pc of shareholders to approve the deal. Jimmy Choo's management, which own 1.55pc of its shares, have also given positive undertakings.
In addition to JAB, it is understood that China's Hony Capital had shown interest in making a bid, as it eyed up the potential for expanding Jimmy Choo in Asia.
Jimmy Choo was originally founded by the eponymous Malaysian-born and Hackney based shoemaker and former Vogue journalist Tamara Mellon in 1996.
The company then passed through a number of private equity owners with Ms Mellon leaving the business in 2011 following an acrimonious dispute with Lion Capital.
The row was later documented in her book, In My Shoes, in which she likened private equity firms to "vultures" who didn't understand the world of fashion.
"We are pleased to announce the acquisition of Jimmy Choo, an iconic brand with a rich history as a leading global luxury brand", said John D. Idol, Michael Kors' chairman and chief executive.
"We believe that Jimmy Choo is poised for meaningful growth in the future and we are committed to supporting the strong brand equity that Jimmy Choo has built over the last 20 years", he added.
Jimmy Choo's chairman, Peter Harf, said that a combination with Michael Kors would allow Jimmy Choo to "embark on its next phase of growth."
