CHINA’S textile company Shandong Ruyi is set to buy control of SMCP Group, the French firm behind fashion brands Sandro, Maje and Claudie Pierlot, for 1.3 billion euros (US$1.5 billion) including debt, two sources close to the deal said yesterday.

    Sandro, Maje and Claudie Pierlot, which sell dresses priced at around 200 euros, operate in the accessible segment of the luxury market, enjoying solid demand among fast-growing middle classes, particularly in countries such as China.

    SMCP, which is controlled by private equity firm KKR & Co., had filed documents this month to launch an initial public offering (IPO) in Paris as early as April.

    The company’s preparations for a float had added pressure on the Chinese group to strike a deal, the sources said. One of the sources said that talks had accelerated in the past week.

    Talks with Shandong Ruyi had been going on for at least six months, but had gone cold earlier in the year over price differences, sources close to the talks said earlier.

    The sources said that founders Evelyne, Ylan Chetrite and Judith Milgrom, who together own 21.11 percent of the company, were more in favor of an IPO but KKR, which has 70 percent, backed a deal with Shandong Ruyi.

    The founders, together with the firm’s management, will retain a minority stake under the deal, the sources said. (SD-Agencies)