It may very well be —rowing speculation in the U.K. financial markets state that Burberry could be acquired by one of the big luxury conglomerates, and sooner than later. In the past, rumors have mostly mentioned LVMH Moët Hennessy Louis
Vuitton, but recently the talk has shifted to focus on French company PPR. On Friday, Peter Farren, an analyst in the London office of Bryan Garnier & Co., called
Burberry “an attractive bid target, thanks to its strong brand momentum
and 100 percent free float.” Farren named PPR, which is “in the process
of building its brand portfolio” as a likely suitor.
So what makes the iconic British brand so "attractive"? Burberry has a
market capitalization of 3.7 billion pounds, or $5.7 billion, and is
trading at a 22 percent premium to its peers. Not too shabby! PPR most certainly
would have the means to do some sort of acquisition. According to its 2009 earnings
report, the French parent of Gucci Group and Puma has available cash of
945 million euros, or $1.23 billion, and a medium-term credit line
worth 6 billion euros, or $7.74 billion. Spokespeople for PPR and
Burberry both declined to comment on the speculation at the end of last week. Perhaps more answers are to come…..
Article Source: WWD
Photo Source: dylanfashion.wordpress.com
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