Taiwan-based Zoyi Capital has acquired a controlling stake in Pink Lady, a manufacturer of highend women’s apparel in China, according to a firm statement.
The deal was valued at $30 million – $40 million, Andrew Kuo, founding partner and chief executive of Zoyi told Private Equity International.
Pink Lady, which is Shanghai based and owned by Taiwanese, manufactures and distributes highend women’s apparel with hand-knitted patterns. It has 60 distributors and reaches 400 stores in China, mostly located in mid-to-high growth cities, according to the statement.
Kuo said China’s slowing GDP growth will likely impact the luxury goods sector, but women’s highend apparel is different, having grown the last two years. He expects the growth to continue and believes Pink Lady is well-placed to benefit.
Pink Lady was family-run and Zoyi brought in an entirely new management team including CEO, COO and head of sales, Kuo said.
“We’ll now focus on the supply chain and distribution channels, helping the distributor to enhance same-store sales. The business is doing quite well, so expansion will be in a later phase.”
Kuo added that valuations in China are in general becoming more reasonable.
“We emphasise value added work and we partnered with the owner, who remained a shareholder, so we’re pleased with the entry valuation.”
The firm is about to close another China deal, Kuo said, but he declined to provide details.
Zoyi Capital is a Greater China-focused fund, investing in mid-cap companies in China and Taiwan.
The firm was founded by three Taiwanese: Andrew Kuo, former vice chairman of Blackstone Greater China, Pei Pei Yu, former managing director at Goldman Sachs PIA Asia and Eric Chen, previously president of Greater China at Temasek subsidiary Fullerton Financial.
In August 2013, Zoyi launched its debut fund with a target of $300 million and a hard cap of $500 million, according to PEI’s Research & Analytics division.