The private equity pair that had bid €557 million ($744 million) to buy out French resort operator Club Méditerranée has withdrawn the offer in light of a proposal from InvestIndustrial.
InvestIndustrial, the Southern European investment group, made an offer of €21 per share in the business and a further €22.41 for its convertible bonds, according to a statement.
The total deal value would reach €790 million for 100 percent of the business.
The bid was 22 percent above an original offer from Gallion Invest, the consortium including Ardian Private Equity (formerly AXA Private Equity) and Chinese conglomerate Fosun International.
In late June 2013, the two said they would pay €17.50 per share, which is equal to a total bid of €557 million, having raised the offer.
Shareholders had deemed a previous bid from the firms as too low. In late May, they had offered €535 million for all shares and securities in the business, which was subject to approval from an independent board of directors. The offer equaled a price of €17 per share, representing a premium of 28.4 percent over the company’s average share price during a 30-day trading period.
Andrea Bonomi, founder of Investindustrial, said in a statement, “With this offer, we will finally give Club Med the means to execute an ambitious project and the ability to return to sustainable growth, respecting its values, identity and its employees.”
The firm intends to focus on geographical expansion focused on growth markets, which includes having a more ambitious strategy in China and Asia. The firm plans to develop a second brand, JoyView by Club Med, in China, as well as develop three more resorts than is specified in the current plan.
Fosun has been a partial investor in Club Med since 2010, when it invested alongside cross-border firm A Capital. The firms acquired a 7.1 percent stake in the business, which was later increased to 10 percent, and had a strategy to expand the operations into China.
In its own statement on the withdrawal of the bid, Fosun said, “Such a decision does not modify the declarations made by the parties during the Club Med's board of directors meeting, pursuant to which Fosun stated that it was exploring any potential options which would serve Fosun's and Club Med's best interests, and Ardian stated that it would also be associated with such considerations, thus the parties to the investment agreement will continue acting in concert for such purposes.”