UPDATE 2-China's YGM takes Aquascutum off the shelf
* Agrees to buy Aquascutum for 15 mln pounds
* Second Chinese acquisition of a British brand this month
* Aquascutum administrators say deal will save over 100 jobs
By Adveith Nair and Donny Kwok
LONDON/HONG KONG, May 10 (Reuters) - YGM Trading Ltd has agreed to buy Aquascutum, the failed luxury clothes maker that has dressed royalty and politicians, for 15 million pounds ($24 million) in the second Chinese acquisition of a venerable British brand this month.
Cash-rich Chinese investors are picking up European assets as the region grapples with a sovereign debt crisis, slowing economic growth, depressed stock market valuations and a dearth of deal-making capacity among potential buyers closer to home.
Fashion retailer YGM's deal comes barely a week after Chinese state-owned Bright Food agreed on May 3 to buy a controlling stake in privately held Weetabix, the 80-year-old breakfast cereal maker that coined the slogan "Have you had your Weetabix?"
Other recent high-profile Chinese acquisitions include machinery maker Shandong Heavy Industry Group's deal to take over debt-laden Italian luxury yacht maker Ferretti.
The 161-year-old Aquascutum, which has dressed Britain's Queen Elizabeth and former prime ministers Winston Churchill and Margaret Thatcher, is the latest high-profile fashion name hit by the country's retail downturn.
Founded by tailor John Emary in 1851, Aquascutum's brand rose to fame before celebrity advertising became mainstream, helped by its long association with the British royal family.
After King Edward VII first bought an Aquascutum coat in 1897, the slick and expensive rain coats became popular with aristocrats, political leaders and movie stars. The likes of Humphrey Bogart were often seen wearing the iconic brand.
But in recent years it has struggled, recording financial losses and teetering on the brink of failure, while bigger British luxury companies like Burberry and Mulberry became global brands.
Hopes for a turnaround were also hampered by the fact the company's royalty rights for the Asian market, a high-growth area for luxury goods, have belonged to YGM since 2009.
YGM - which also distributes men's and ladies' wear under brands including Michel René, Guy Laroche, Charles Jourdan, Ashworth, and J.Lindeberg - said the acquisition was beneficial, given the substantial potential for Aquascutum's development.
Trading in YGM shares was suspended earlier on Thursday.
FRP Advisory - which said in April that two of its partners had been named administrators of Aquascutum - said the sale, which includes the UK stores, concessions and head office operations, would safeguard jobs of more than 100 employees.
FRP added they were continuing to deal with interested parties regarding a sale of the factory based in Corby, which they hope to achieve within the next two weeks.
Retailers in China, including menswear group Trinity Ltd , have been snapping up high-end European brands as Chinese consumers demand better quality in everything from suits and handbags, to shoes and yachts.
The Chinese government has said it wants the country's companies to buy top brands as a shortcut to global success.
- Somali officials say U.S. struck where al Shabaab were meeting
- Marilyn Monroe sex film to be kept private |
- Ukraine accuses Russia of 'undisguised aggression' as rebels advance |
- Actress Jennifer Lawrence contacts authorities after nude photos hacked
- Risk appetite flickers in Europe, ECB speculation holds down euro