Puma shares were trading in the red Friday, as owner Kering Group announced it would exit its position as a majority shareholder, by redistributing most of its 86% of shares of the sporting goods business. Kering will retain 16% of Puma, as it focuses its efforts on its luxury brands.
By 1230 BST, Puma shares were 5.03% lower at €321.00. The performance of Puma shares during 2017 was positive, as the brand experienced a resurgence of appetite for more retro sports brands in the US.
Puma welcomes announcement
While some shareholders may be disappointed that Kering hasn’t opted to try and sell its Puma stake at a premium, Puma said it was happy with the news and plans to go forward with its existing strategy.
“We are very pleased that Kering has proposed this way to reduce its stake in PUMA. It would allow us to continue with our current business strategy that has started to show good results,” said Bjørn Gulden, CEO of PUMA.
“We would be able to carry on to invest in becoming the Fastest Sports Brand in the world, create value for retailers, improve performance for athletes and excite consumers,” Gulden added.
Kering’s strategy means that the proportion of Puma shares that will be available to be traded on the stock market will increase from 14% to around 55%.
The transaction is subject to approval at Kering’s Annual General Meeting on 26 April 2018.
Kering to focus on its luxury brands
Kering bought its 86% share of Puma in 2009 as it sought to gain a foothold on the sporting lifestyle sector. Under Kering’s stewardship Puma has recovered after a difficult period.
“The contemplated distribution of Puma shares to our shareholders would be a significant milestone in the history of the Group,” said Francois-Henri Pinault, Chairman and CEO of Kering.
“Kering would dedicate itself entirely to the development of its Luxury Houses, whose enduring appeal built on creative audacity and innovativeness, will allow us to continue to gain market share and gain value,” Pinault said.