By Kane Wu
HONG KONG (Reuters) – Blackstone and Chinese language on-line retailer JD.com are amongst greater than 10 events to bid for CMC Holdings, the only real distributor of FANCL’s skincare merchandise in Asia outdoors Japan, individuals with direct information of the matter stated.
Bain Capital, Carlyle, MBK Companions, Sequoia Capital and CITIC Capital are additionally among the many bidders for CMC, valuing the enterprise owned by Hong Kong-based Chris Chan at near $1 billion, the sources instructed Reuters.
In August, Chan appointed Morgan Stanley to promote CMC, which operates greater than 200 shops in Higher China and Southeast Asia.
Chan, CMC, Bain, Carlyle, MBK and Morgan Stanley declined to remark. Blackstone, Sequoia, CITIC and JD.com didn’t reply to requests for remark.
Among the non-public fairness companies wish to staff up with a strategic companion, stated the individuals, who spoke on situation of anonymity as a result of the knowledge is confidential.
China’s web giants Alibaba Group and Tencent Holdings have proven curiosity and will be part of a bidding group later within the course of, they added. Each declined remark.
The curiosity in FANCL’s enterprise outdoors Japan signifies investor confidence in a client restoration in Asia, notably in China which accounts for round 80% of FANCL Asia’s income.
FANCL, whose merchandise are offered and marketed on Alibaba’s TMall, JD.com and Tencent’s WeChat, stated this yr it was in talks with its distributor to launch e-commerce platforms as quickly as attainable.
Alibaba and JD, respectively, generated gross merchandise quantity (GMV) of 498.2 billion yuan ($75.3 billion) and 271.5 billion yuan on this yr’s Singles’ Day gross sales occasion, with Japan among the many top-selling nations.
CMC is predicted to finalise a shortlist for the second spherical of bidding by the tip of subsequent week and binding bids are due by the tip of January, the individuals stated.
Asia accounts for 53% of worldwide skincare gross sales, Euromonitor information confirmed, with researchers anticipating annual progress above 5% within the subsequent 5 years.
Chan is exiting CMC after 25 years as FANCL’s sole distributor outdoors Japan. His contract for China expires in six years and that for the remainder of Asia in 10, Reuters has reported.
Aside from CMC, FANCL Corp additionally sells merchandise by way of its personal retail channels outdoors Japan, generally at completely different costs, individuals conversant in the state of affairs stated.
Some bidders are involved about this observe, which is named “parallel import”, because it might trigger confusion and damage enterprise margins and any purchaser must negotiate with FANCL for future preparations, they stated.
FANCL and Kirin Holdings, which owns 30% of the Tokyo-listed firm, are usually not concerned within the sale course of, the sources have stated. Each declined remark.
(Reporting by Kane Wu in Hong Kong, extra reporting by Julie Zhu and Pei Li in Hong Kong, Brenda Goh in Shanghai and Ritsuko Shimizu and Makiko Yamazaki in Tokyo; Modifying by Ana Nicolaci da Costa and Alexander Smith)