The CDH fund is buying Belle International and saving the company from crisis: it’s the biggest ever buyout of a Hong Kong consumer company

CDH Investments Fund Management Co. is negotiating to buy the Chinese footwear retailer Belle International. Last Tuesday Belle shares were suspended on the Hong Kong stock market pending the announcement. Before the suspension, Belle’s market value was 5.17 billion dollars. A deal of this size, which could be concluded within the week, would be the largest ever buyout of a Hong Kong-listed consumer company, according to Bloomberg. Belle operates over 20,000 retail outlets in China, but since 2011 it has seen a steady decline in operating margins as a result of the arrival of e-commerce. The company that sells fashion footwear, remains one of the top five footwear companies in China, in a market dominated by sportswear companies. “The footwear business continues to be weak”, said Belle, and the company has seen a fall in retail sales of 6.2% in the fourth quarter, while the sportswear and apparel business showed a growth of 4.5%. CDH Investments, with assets of 17 billion dollars as of the end of last year, had already invested in Belle International before the 2007 IPO and Hu Xiaoling, managing director of CDH, is also a non-executive director of Belle International.


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