Hong Kong watch company draws CVC bid

Trading of Peace Mark shares has been suspended following an indicative offer from CVC Asia Pacific, which has made four investments in Greater China in the last 12 months. Peace Mark has exclusive arrangements with brands including De Beers and Gucci-owned Boucheron and has a $241m market cap.

CVC Asia Pacific, a unit of European buyout firm CVC Capital Partners, has made “an indicative offer of a possible subscription of shares” of Peace Mark Holdings, a Hong Kong-based watch manufacturer, distributor and retailer.

Peace Mark revealed CVC’s interest to the Hong Kong Stock Exchange in a statement, following which trading of the company’s shares were suspended 18 August.

The company’s shares were last trading at HK$1.50 ($0.19; €0.13) on Friday evening. Its shares have dropped almost 70 percent since the end of July, when they were trading at HK$4.95 a share.

Established in 1983, Peace Mark manages a retail network through which it sells more than 100 mid-range and luxury watch brands in Greater China, besides also also manufacturing and distributing timepieces.

Earlier this year Peace Mark said it had agreed a deal with Boucheron, a luxury French jewellery brand owned by Gucci Group, to develop Boucheron locations in China, Hong Kong and Macao. At the time, Peace Mark said it planned to open 10 standalone Boucheron stores and a minimum of 20 “Shop-in-Shop” for the brand in the Tourneau watch retailer's network in Greater China within five years starting in July 2007.

Peace Mark also has an exclusive franchise arrangement with diamond jewellery company De Beers to operate its retail outlets in China. 

Last month, CVC Asia Pacific invested HK$873.5 million in new shares of Hong Kong-listed Hung Hing Printing Group, a Chinese packaging and printing company, for a 35 percent stake. In the same month, it also opened its Beijing office, its first in mainland China.

The firm has so far completed 29 investments in Greater China, Southeast Asia, Korea, Japan and Australia, for a total transaction value of $19 billion. In April this year, the firm closed CVC Capital Partners Asia Pacific III, a $4.1 billion buyout fund.