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Jimmy Choo is up for sale

The shoe king is looking for a buyer - of which there seem to be a few if other transactions in the sector are any indication
April 27, 2017

It seems there's a flurry of M&A activity among luxury retailers lately. Investors might remember trenchcoat maker Burberry (BRBY) spurning "multiple" takeover offers from US brand Coach (US:COH) at the end of last year. Now, it's rumoured that Coach is preparing a $2bn (£1.7bn) takeover offer for New York accessories brand Kate Spade. What's more, luxury conglomerate LVMH (MC) just confirmed it will buy the remaining stake it doesn't already own in Christian Dior for £10bn, or €230 (£196) a share. Analysts initially called this a "fair valuation", but Dior shares have subsequently risen to €253.

IC TIP: Hold at 187p

But could either of those groups have buyer's remorse? It just came to light that shoe king Jimmy Choo (CHOO) is up for sale. The brand - made famous by the hit TV show Sex and the City - has been put on the market by its major shareholder, German investment group JAB Holdings. The group, which floated a quarter of Jimmy Choo at the end of 2014, said a potential sale would be the best way to maximise value for shareholders, although it was not currently in receipt of any offers.

The decision comes as JAB tries to transition away from luxury goods and towards the coffee market, having bought coffee machine maker Keurig Green Mountain back in 2015 for $14bn. JAB first bought Jimmy Choo for £500m back in 2011, and the retailer's current market cap now stands at £656m. JAB still has investments in luxury clothing brand Bally and, via beauty giant Coty, in groups such as Calvin Klein and Marc Jacobs.

Analysts are restricted from commenting in light of the potential sale, while the company declined to elaborate on their initial statement.