HANG Ten Group Holdings Co.,Ltd., the Hong Kong-based clothing retailer, climbed by a record after receiving a HK$2.65 billion (US$340 million) buyout offer.

Hang Ten soared 56 percent, the biggest gain since listing in 2003, to HK$2.65 in Hong Kong. The Hang Seng Index rose 0.06 percent yesterday.

The offer by Li & Fung Retailing Ltd, which has opened more than 100 Toys "R" Us stores in Asia, values the shares at 59 percent more than their closing price on Thursday, before a trading halt. The deal would be the largest for a Hong Kong apparel company, based on data compiled by Bloomberg News.

Asian clothing and consumer brands have become acquisition targets as the region's shoppers grow more affluent. Apparel firms were bought in 34 deals valued at US$1.3 billion in Hong Kong in the past three years, according to data compiled by Bloomberg News. The buyers paid an average premium of 22 percent.

"Hang Ten has retail networks in Greater China and Southeast Asia which can help boost Li & Fung's presence in the region," said Kenneth Li, a Cinda Securities analyst.

Li & Fung Retailing, whose parent is the biggest investor in consumer-goods supplier Li & Fung Ltd, offered to buy all outstanding Hang Ten shares at HK$2.70 each, Hang Ten told the Hong Kong's stock exchange on Monday. The stock traded at HK$1.70 on Thursday, the day before it was halted, pending an announcement.

Li & Fung Retailing said it won't raise the offer for Hang Ten, whose profit totaled HK$239 million for the year ended March 31.

 

Source:shanghaidaily.com