SMCP initiates legal proceedings against bondholders
The owner of French fashion company SMCP said she has taken legal action against bond companies who have allegedly tried to take control of SMCP at a low price. The news was reported by Reuters.
TopSoho, a European company and a unit of Shandong Ruyi, which owns 53% of the capital of SMPC, last month failed to honor a debt of 250 million euros exchangeable for shares of the company. This left the door open for bondholders, including BlackRock and Carlyle, to take a 37% stake in SMCP.
TopSoho said it has started legal proceedings to identify the parties who they believe “conspired by illegal means to injure and cause loss to the company by forcing it into a position where the conspirator (s) could acquire or obtain the control of SMCP SA to an undervaluation. “
A number of companies have been brought before a UK court against several companies including Glas SAS, a company serving a bond group, the subsidiary of Carlyle, Celf Advisors LLP, and BNP Paribas Trust Corporation UK Limited, which acts as depositary of the SMCP shares which have been given as collateral. for bonds.
Glas has previously stated that due to the non-payment of his bond by TopSoho, he is now able to exercise voting rights equal to 29% of SMCP Capital. Glas also said it did not intend to initiate a buyout of SMCP. SMCP said the current situation is not affecting its finances and day-to-day operations.
Shandong Ruyi, the parent company of TopSoho, embarked on a wave of fashion shopping in 2018 that included Cerruti 1881, Aquascutum, and Gieves & Hawkes. Their goal was to become a luxury fashion conglomerate, but the crippling debt they incurred with these acquisitions crushed them.
Bondholders should look for a buyer for the stocks and given SMCP’s popularity with brands like Sandro and Maje to their credit, they could be a nice acquisition for an investor or a company looking to enrich their fashion portfolio. The transfer of bondholders’ shares could begin on October 19.