UK Supreme Court invalidates sale of 15.9% stake | kbnmart

In 2021, China’s Shandong Rui Group, formerly the owner of fashion conglomerate SMCP, went bankrupt. Subsequently, several creditors, with specialist debt management firm GLAS as trustee, seized a stake of around 30% in SMCP, the group that owns Sandro, Maje, Claudie Pierlot and Fursac, with the aim of selling their shares publicly later. But the process has resulted in a complex financial tangle. Shandong Rui, through its European subsidiary European TopSoho, still owns an 8% stake in SMCP, while another 15.9% has been transferred to Dynamic Treasure Group, a British Virgin Islands-based company registered in the name of Shandong Rui’s founder’s daughter.

On July 12, 2024, the UK High Court declared the sale of a 15.9% stake in SMCP by European company TopSoho to Dynamic Treasure Group in 2021 invalid. The ruling came in response to an appeal filed by GLAS, which the court upheld. GLAS acts as trustee for five of the group’s creditors: BlackRock, Carlyle, Anchorage, Boussard and Gavaudan. According to the French business daily LesicoThe creditors plan to buy the stake in question in order to obtain better leverage on the group’s capital in the future.

In a statement, SMCP said the court is expected to issue an injunction “soon, demanding the return of the 15.9% stake in Dynamic Treasure Group to the European company TopSoho, which is currently being liquidated in Luxembourg.”

The coming months are set to witness a new chapter in this financial saga. Earlier this year, SMCP, which is listed on the Paris Stock Exchange, unveiled an action plan aimed at revitalizing the business and improving profitability. The plan includes downsizing the group’s operations in China, entering the Indian market, and reviewing all of SMCP’s existing contracts, especially leases and supply contracts.

In the first quarter of 2024, SMCP, which operates more than 1,700 stores worldwide, recorded a 5% decline in global revenues compared to the previous year, to €287 million. During that period, revenues fell in the Asia-Pacific region (down 15.7%) and in France (down 7.4%), but were strong in America, where they grew by 8.9%.