Hong Kong Fashion Label Maker SML Narrows Buyout Bidders

(Bloomberg) -- SML Group Ltd., a closely held garment label maker for fashion brands and retailers globally, has narrowed the field of bidders as it moves ahead with a potential sale of the business, according to people familiar with the matter.

Buyout firms Affinity Equity Partners, and FountainVest Partners are among bidders that have been selected to continue in the process, the people said, asking not to be identified because the matter is private. Cornell Capital and Platinum Equity have also proceeded into the next round of bidding, the people said.

Binding bids are expected within the next few weeks, although the coronavirus outbreak could slow down the process, the people said. Deliberations are ongoing and no final decision has been made, the people said.

Representatives for Cornell Capital, FountainVest and Platinum Equity declined to comment, while representatives for Affinity Equity and SML didn’t immediately respond to requests for comment.

The company has been working with Citigroup Inc. as it explores a sale, Bloomberg News reported earlier this year. The business attracted interest from private-equity firms and could fetch about $500 million, the people familiar with the matter have said.

SML makes woven and printed labels, price tickets and hangtags as well as zippers and buttons, according to its website. Founded in a warehouse office in 1985, the company has since expanded both organically and via acquisitions. It counts offices and production sites in 30 countries including the U.S., Mexico, Spain and Indonesia.

A deal for SML would follow the sale in 2018 of Hong Kong-based apparel label maker Trimco International Holdings Ltd. by Partners Group to Affinity for $520 million.

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