Club Med: Bonomi throws in the towel after outbidding Fosun – The Point

Club Med: Bonomi throws in the towel after outbidding Fosun – The Point

The Chinese conglomerate Fosun will be able to seize the Club Mediterranean, Italian businessman Andrea Bonomi Friday having thrown in the towel, giving up bid for the umpteenth time in Homeric battle for the takeover of the French group of clubs vacation. On December 19, the Chinese conglomerate Fosun and Sino-Brazilian-French-Portuguese partners had raised again their offer on the French company, offering 24.60 euros per share, against 24 euros previously offered by the Bonomi team. An offer that values ​​the company at 939 million euros, which is less than at the last Club Méditerranée, which closed at 25.09 euros on Friday night.

But this time the stakes will go up no higher. Because “after having carefully analyzed the situation of the public offer for the shares of Club Méditerranée SA and, in particular, valuation levels achieved for the company, the board of directors of Global Resorts SAS (a company of Andrea Bonomi, Ed) has decided not to bid, and therefore intends to withdraw its offer, “said the Bonomi camp in a statement. The Italian businessman puts an end to the longest takeover in the history of the Paris on a Friday night in the hollow New Year of the bridge. And he justifies his choice by financial reasons, Global Resorts saying that “the current situation and valuation levels do not allow to consider that the Club Med is an investment opportunity.”

Now it is the other team, led by Chinese Fosun, which way free Global Resorts even offering to hand over the 18.9% stake in Club Med held. Fosun held so far 18.25% of the French group. “The shares held by Club Med Global Resorts will be tendered Gaillon Invest II, or sold on the market,” explains Global Resorts indeed. Gallio Invest II is the company created by Fosun to bear its own takeover.

Focus on China

Beyond War outbidding, Bonomi and Fosun will not have the same vision on the future of Club Med, which specializes in high-end resorts. Fosun strong emphasis on the development in China, “the world’s largest tourism market,” and in Brazil with its Brazilian partner Nelson Tanure: the Docas Investimentos conglomerate is supposed to take up 20% of Gaillon II capital, or about 10% of Club Med. Possible projects are discussed elsewhere, notably in Colombia, and discussions were held with “other regional partners, including Europe and North America,” some of which may eventually enter the capital.

This vision of a multi-continent development is not different from that which was defended far by Andrea Bonomi and his supporters. But the Italian, who reiterated Friday that he was a “consistent” approach would be more interested in mid-range clubs and villages to be less focused on China.

a strategy that has not paid off

The offer of Fosun had in any case favors the CEO of Club Med, Henri Giscard d’Estaing who defends the move upmarket and internationalization of Club Med, which aims to balance between French customers, developed and emerging countries. The French now make up 36% of customers of the 70 villages of the group trident in 26 countries (448,000 French), followed by Chinese (126,000) and Belgium (80,000).

One strategy that has not yet paid off as the last year, the Club Méditerranée wiped € 12 million net loss group share for sales of 1 38 billion and an operating profit of 13 million. Its leaders, however, insist “heavy investments”, “1.2 billion euros over the period 2002-2014.”

The battle for redemption of Club Med, eventful, remedies and bidding, began in May 2013 when Fosun then associated with Ardian funds (formerly Axa Private Equity), was launched to assault the group with an offer of 17 euros per share.