Chinese luxe retailer Secoo mulls CEO approach to go private
Chinese luxury e-tailer Secoo Holding Limited is considering going private and delisting its shares after receiving an approach from founder, chairman and CEO Richard Rixue Li to do so. His non-binding proposal could see him acquiring all the shares he doesn’t already hold.
Its shares are currently listed in the US on NASDAQ and he’s offering a premium of 10.5% to the closing price as of Monday. The current share price values the business at around $200 million after rising sharply on Monday, although they fell back a little on Tuesday. And they’re still down around 70% since they were first listed in 2017.
The board has now formed a special committee consisting of independent directors Jun Wang and Jian Wang to “evaluate and consider the proposed transaction”.
Beijing-based Secoo is one of the big names of luxury online retail to come out of China, although it nonetheless lags behind mega-sized market peers such as Alibaba’s Tmall and JD.com. That said, it’s the country’s largest luxury-focused lifestyle platform and as well as selling local and international fashion labels, it also sells jewellery and even cars.
In Q3, its net profit plunged by two-thirds to CNY20.77 million (€2.63 million) as gross merchandise volume rose 12.5% to CNY4.1 billion but revenue fell nearly 30% to CNY1.37 billion.
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