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Kering to sell off Puma shares

Puma quarterly sales pushed on by women’s sneakers , APAC up 10%.

French luxury group Kering plans to sell-off its stake in Puma, offering shares of the German sports firm to current shareholders, in a bid to focus more on luxury brands.

Kering said it planned to distribute 70% of Puma shares to its investors, leaving it with only a 16% stake. In addition, the group said it would also look at shedding shares it fellow sportswear label, Volcom.

SEE ALSO : Puma quarterly sales pushed on by women’s sneakers, APAC up 10%

“We found ourselves in a sort of imbalance, linked to the outperformance of the luxury sector,” said Kering’s finance chief Jean-Marc Duplaix.

The French company said it would retain a small stake in Puma to reap some benefits from the brand’s recovery, as Kering will make no cash gains from the deal.

Kering is 40% controlled by France’s Pinault family, which would receive about 29% of the sporting goods company, while Puma’s free float would stand at about 55%.

Commenting on its planned share withdrawal from Puma, Kering said in a statement: “This proposal will allow Kering to strengthen its status as a luxury pure-player, with an improved level of profitability, positioning the group amongst the best in the sector.

Kering is aiming to continue growing and developing its ensemble of luxury houses in couture, leather goods, watches and jewellery, leveraging its higher cash flow generation and a solid financial situation.”

The price of the transaction, which will be put to Kering shareholders in April at the group’s annual meeting, has yet to be determined.

SEE ALSO : Puma Asia-Pacific records most growth in Q2

The decision comes at a time where Puma is witnessing a brand turnaround, after years of struggling when Kering purchased the European brand in 2007.

Trailing behind Nike and Adidas, Puma has had to focus on soccer, running and motorsport to gain traction. In 2014, it launched on the women’s sportswear offence by appointing singer Rihanna as creative director.

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