In major news on Hong Kong stocks, L’Occitane International SA, (HK:0973) announced that its owner, L’Occitane Groupe SA, has proposed to acquire all outstanding shares of the company in a privatization deal. The transaction is valued at up to HK$13.91 billion (€1.7 billion), with the company’s equity valued at €6 billion.
Trading of L’Occitane shares, which had been suspended since April 9, resumed today. L’Occitane stock was up nearly 10% as of writing. On approval, this proposed deal would lead to the company’s delisting from the Hong Kong Stock Exchange.
L’Occitane International is a French luxury manufacturer and retailer of beauty and wellness products. L’Occitane Groupe, headquartered in Luxembourg, is an investment holding company owned by Reinold Geiger, who serves as chairman and CEO of both entities. As of the end of March, L’Occitane Groupe owned 72.39% of L’Occitane International.
More Details on the L’Occitane Buyout
Geiger has offered to pay HK$34 per share for the remaining shares, which represents a premium of approximately 60.83% over L’Occitane stock’s average closing price over the last 60 trading days. The offer price has been stated as final, with no possibility of any further increase.
According to the company’s announcement, around 25.79% of the shareholders of the offered shares have agreed to tender their shares. Meanwhile, an additional 12.17% of shareholders have either submitted letters of intent or intend to endorse the offer.
The deal’s purpose is to allow the company to operate more flexibly as a privately held entity in a highly competitive landscape. L’Occitane’s privatization will enable the company to invest in long-term growth plans without being bound by capital market expectations, costs, or disclosure obligations.
L’Occitane Share Price Target
As per the consensus rating on TipRanks, 0973 stock has received a Moderate Buy rating, supported by two Buys and one Hold recommendation. The L’Occitane share price forecast stands at HK$31.71, which is 7.48% above the current level.
