The deal was announced Friday that would see the sale of all Fila Holding S.p.A operating businesses to Sport Brands International LLC, an affiliate of Cerberus Capital Partners, LP.
Cerberus is a special situations investment firm, with over $8.5 billion under management.
The $351 million cash deal is expected to close by June 30, 2003 and involves the sale of all FLH direct subsidiaries, Fila Nederland BV, Fila Sport S.p.A., Ciesse Piumini SRL and Fila USA Inc., to Sport Brands International. The subsidiaries represent 100% of Fila group.
SBI will also assume all financial debt incurred by the Fila group since January 1, 2003 and of all of the Fila group’s trade debt. FLH had 295 million ($309.2 million) in debt at the end of 2002, but no indication was made of debt accumulated since that time.
Holding di Partecipazioni Industriali S.p.A. (HdP), which owns 91% of Fila Holding S.p.A, will offer to purchase all of the Fila American Depositary Shares and all of the Fila ordinary shares not already owned by HdP for a price of $1.12 per Fila ADS or Fila ordinary share. HdP is expected to complete these purchases by early September.
The Fila Board approved the terms of the sale suggesting that “the Fila group’s economic results in recent years and the difficulties and uncertainties in achieving stable positive net results in the near future.” The negative worldwide prospects outlined in FLHs 2002 report (see page 4) over-shadowed the obvious improvements in the U.S business.
Hdps Board of Directors said it plans to reinvest the net proceeds of the sale in new activities in the communication businesses that are being considered.