Serena Williams's Racket Maker Gets $5.5 Billion Chinese Bid

(Bloomberg) -- China’s Anta Sports Products Ltd. is gearing up for the Olympic Games in Asia with a 4.7 billion-euro ($5.5 billion) approach for one of the world’s biggest athletic gear makers.

Anta said it and Chinese buyout firm FountainVest Partners made an indicative offer for Amer Sports Oyj of Finland, which makes the Wilson tennis rackets used by Serena Williams as well as the Atomic and Salomon ski equipment. Under the non-binding approach, which is subject to due diligence and other conditions, shareholders would receive a cash consideration of 40 euros a share, Anta said in a statement Wednesday.

The Finnish company said in a separate statement it isn’t in negotiations with the consortium and hasn’t made any decisions related to the proposal. Amer shares jumped 19 percent to close at 34.20 euros in Helsinki on Tuesday, after the company confirmed a Bloomberg News report on the takeover interest. The shares had risen 25 percent this year before news of the approach.

The move comes amid a Chinese government-led push to expand in sports ranging from soccer to skiing, as well as the industries that supply equipment for competitors and weekend enthusiasts. Beijing will play host to the Winter Olympics in 2022, providing a springboard for sales of skis and snowboards, while the 2020 Summer Games in Tokyo will offer a showcase for other Amer brands.

Amer’s portfolio of ski brands “perfectly complements” Descente, the winter sportswear Anta sells in China, UOB Kay Hian analyst Robin Yuen said in a note, adding that the approach “is good timing to capture the hype of winter sports” ahead of the Beijing games.

Adidas Deal

Amer acquired Salomon and other brands from what was then known as Adidas-Salomon AG in 2005, adding the French label to Austrian brand Atomic, which Amer had acquired about a decade earlier. The German sportswear giant retreated from winter sports amid a sluggish market for ski equipment, though Salomon’s sports shoes have been a hit since then.

Anta, China’s biggest athletic apparel producer, has held discussions with banks about a potential acquisition of Amer, people with knowledge of the matter said earlier.

The Chinese company, which has a market value of $12.5 billion, has been working to expand its business overseas and is seeking acquisitions of well-established global brands. It is also scouting for business partners to help it enter the European market as soon as next year, James Zheng, Anta brand president, said in a February interview.

Amer said earlier this month that it’s conducting a review of its Mavic cycling brand to focus on more profitable, faster-growing businesses. Over time, the company also plans to assess strategic options for its Fitness and Sports Instruments businesses, including standalone opportunities, as they grow toward their target scale.

Louisville Slugger

Amer’s other brands include Louisville Slugger baseball bats and Arc’teryx outdoor gear. In the market for adventure clothes and footwear, the company competes with VF Corp., the U.S. owner of The North Face and Timberland brands, which last month moved to separate its denim business into a new company.

Anta, which previously bought the greater China rights to the Fila brand, had $1.5 billion of cash and equivalents at the end of June, data compiled by Bloomberg show.

Anta’s shares fell 1.9 percent on Tuesday. The stock has retreated for seven straight days as U.S. President Donald Trump threatens more tariffs on Chinese imports. Anta said last month it’s slowing its entry into the U.S. due to the volatile trade environment, and is looking to move some of its manufacturing outside of China.

©2018 Bloomberg L.P.