Precor Parent Company to Be Acquired by China-Based Anta Sports

Precor parent company to be acquired by Anta Sports
With the sale, Amer Sport, which is the parent company of Precor, will become a private company. (Photo courtesy Precor.)

Amer Sports, the Finnish parent company of Precor, Woodinville, Washington, will be acquired by China-based Anta Sports Products Limited, according to a recent release by Anta Sports.

The sale, pending finalization, will take the publicly traded Amer Sports private. Amer Sports will operate as a separate entity, according to a March 8 media release.

Anta Sports stated its interest in acquiring 94.98 percent of Amer Sports' shares and votes, excluding those held by Amer Sports and its subsidiaries. The company said it will announce the preliminary percentage of the shares tendered around March 28, with the final percentage being announced around April 1.

Anta Sports is the leader of a purchasing consortium interested in Amer Sports that includes Chinese technology firm Tencent and an investment company owned by Lululemon Athletica founder Chip Wilson. The consortium initially offered €40 ($45) per share to acquire Amer Sports. This is nearly 14 percent above Amer Sports' then-closing trading price, valuing Amer Sports at approximately $5.2 billion, according to a CNN report.

“We are delighted about the opportunity to invest in Amer Sports, a leading sporting goods company with a strong portfolio of internationally recognized brands," Anta Sports CEO Ding Shizhong said in a Dec. 8, 2018, release that first announced the possible acquisition. "We share the same passion as Amer Sports’ management in providing excellent products, services and experiences that inspire sports lovers’ achievements and enjoyment, as well as setting the standard for innovation. In particular, we are excited to bring these premium international brands and products to Chinese consumers, who increasingly seek high-end products with outstanding qualities and heritage in various niche and specialized sports segments. Working closely with the other Investor Consortium members, we are fully committed to backing Amer Sports‘ talented management and employee team to stay true to its premium brand value as it accelerates into the next stage of growth under the Investor Consortium’s ownership.”

Amer Sports CEO Heikki Takala said, if the sale is finalized, Amer Sports would become privatized and would continue to operate as an independent entity, taking advantage of Anta Sports' manufacturing and distributing capabilities, in addition to its roots in Asian markets.

"The offer ... represents an acknowledgement of the work we have done, and their plan to keep Amer Sports as an independent company signals a strong confidence in our strategy and business model," Takala said in the release. “Under the ownership of the Investor Consortium, there is an opportunity to continue to deliver our strong sustainable profitable growth with further acceleration in our strategic priorities including soft goods, direct-to-consumer and China. This acceleration provides further exciting opportunities for our people globally. I am pleased that the existing management team has been invited to continue leading the business, and also that the Investor Consortium is committed to retaining our Helsinki corporate head office.”

Amer Sports is the parent entity of several sports and apparel brands including Wilson, Arc'teryx, Atomic and Salomon, as well as Precor.

Precor recently reported a 1 percent increase in 2018 net sales, partially attributable to its new vendor agreement with Planet Fitness

€64.2 million ($72.79 million), or 17 percent, of Precor's  2018 sales were in the Asian-Pacific market. This was a 6 percent increase from 2017.

Doug Johns, Precor's vice president of global marketing and product management, told Club Industry that Anta Sports' offer is a massive and invigorating opportunity for Amer Sports and Precor.

"What’s going to happen is that Amer Sports will continue to be a company on its own," Johns said. "Our board of directors today will go away because we are no longer a publicly traded company. ... A new board of directors will be put in place. ... The senior leadership is still all the same. For everybody in Precor, we have the same boss, the same strategic mandate. We aren’t changing offices."

Moving forward, Precor remains focused on partnering with budget health clubs and university rec centers, while growing new partnerships with hospitality and mult-family housing companies, Johns said.

Anta Sports, which is publicly traded on the Hong Kong Stock Exchange (HKSE: 2020.HK), is the owner of Anta, Fila, Descente, Sprandi, Kingkow and Kolon Sport. The company was founded in 1991 and is based in Beijing.

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