American apparel giant PVH Group recently announced plans to fully acquire Tommy Hilfiger's China business for USD172 million.
This transaction is expected to close in the second quarter of 2016. Prior to this, PVH Group already had a 45% stake in the joint venture TH Asia Ltd., which is responsible for the sales of Tommy Hilfiger.
In 2012, TH Asia Ltd. acquired Tommy Hilfiger's China business from Dickson Concepts International Ltd. During the first year after the acquisition, the total revenue of Tommy Hilfiger's China business was doubled and it was expected to reach USD140 million by 2015. At present, Tommy Hilfiger has about 350 stores, including 65 owned stores and 285 franchised stores.
Emanuel Chirico, chairman and chief executive officer of PVH Group, said that this transaction can ensure Tommy Hilfiger's direct operation in its fastest growing market, fully play to the group's complete infrastructure in Asia, and fully use its regional leading professional knowledge and strong brand development trend of its Tommy Hilfiger and Calvin Klein brands.
He revealed that the Chinese market may be the most profitable market for the group. Statistics showed that over the recent five years, Tommy Hilfiger's China business has been maintaining double-digit growth.
At present, Tommy Hilfiger's men's sports series accounted for 75% of its China business; meanwhile, women's jeans, accessories, and shoes businesses have more growth opportunities.