FRANCE: Fung Brands poised to acquire Sonia Rykiel

Hong Kong based investment firm Fung Brands is in exclusive talks with French luxury fashion brand Sonia Rykiel to take an 80% stake in the company.

Set up a year ago by the Fung family, which controls sourcing giant Li & Fung, Fung Brands' brief is to acquire luxury brands. It has already purchased France's Robert Clergerie (shoes) and Belgium's Delvaux (leather goods).

Sonia Rykiel has been looking for an investment partner for some time and discussions have taken place with a number of potential candidates over the past few months.

Under the takeover proposals, Fung Brands' chief Jean-Marc Loubier, former CEO of Céline and Escada, will head Sonia Rykiel, which was founded by the eponymous designer around 40 years ago.

The Rykiel family will retain 20% of the label and the founder's daughter, Nathalie Rykiel, will continue to hold the post of vice-president and oversee its artistic direction.

Sonia Rykiel, which employs 365 staff, has seen its turnover stagnate at EUR90m (US$118m) over the past two years. However, Loubier estimates the brand's turnover could be doubled over the next five or six years as a result of international expansion.

Export markets currently account for about 50% of Sonia Rykiel's sales, the principal outlet being Europe. It also has a relatively small presence in the US and Asia.