Last week, BOSS reported that Lafuma and Oxbow shares were suspended from trading on the Paris stock exchange pending merger negotiations (See BOSS_0519). This week, the Lafuma Group signed an agreement with Teahupoo, an investment fund acting on behalf of Oxbow's managers, to acquire the 63.55% stake in Oxbow held by Teahupoo and key managers. According to the Paris stock exchange, Teahupoo held a 51% stake in Oxbow while management held a 12% stake. The deal was advised by Argos Soditic.
Under the agreement, Lafuma will pay 10.75 ($13.77) per Oxbow share cum-dividend. This price offers a premium of nearly 10% to the latest closing price prior to suspension of trading of 9.80 ($12.55). In accordance with stock market regulations, after acquiring a majority interest in Oxbow for cash, Lafuma will file a preliminary standing offer based on a price of 10.75 per share cum-dividend. Trading in the shares of both companies will resume on May 13. The standing offer should be filed during the first two weeks of June.
As a result of this transaction, Lafuma will have annual sales of roughly 245 million ($315 mm), based on 2004 year-end results. The company stated that it will have “substantial market shares” in the outdoor mass market through its Lafuma brand, in the board-riding market through the Oxbow brand, in mountaineering through its Millet brand, and “country-wear” through the Le Chameau brand.
The Group expects to expand Oxbows distribution geographically wherever Lafuma has an infrastructure in place, especially in Asia but also in North America. Lafuma also expects to be able to expand both companies product lines and the textile sales volumes would increase by over 30% giving the combined company better buying power with its sourcing partners.
