What's going on?
A group of Chinese investors swiped right on Finnish sporting goods company, Amer Sports – which owns Salomon, Wilson and Arc’teryx, among other brands – indicating their interest and valuing the company at over $5.3 billion.
What does this mean?
The courting consortium comprises a private equity firm and Amer’s Chinese rival, Anta Sports – which has had eyes on Amer for a while. Anta wants to expand overseas and buying big, reputable, international brands is a surefire way to go. According to reports, the Chinese group will make a formal offer in the coming weeks and wants to lock down a deal by the end of 2018.
If Anta succeeds in getting Amer, the combined force might be a formidable opponent for VF Corporation – American owner of Timberland, North Face and Vans – which Amer competes with in adventure clothes and footwear.
Why should I care?
The bigger picture: Shooting for the Olympics?
Along with skimaker, Salomon, Amer owns Atomic Skis, and China is hosting the Beijing Winter Olympics in 2022 – which will likely boost ski sales (both worldwide and in China). Plus, the 2020 Summer Olympics in Japan will show off other Amer brands – like tennis maverick, Wilson.
For markets: It’s all about China.
As Chinese consumers become wealthier, the number of hours they have for leisure each day is growing – and they’re spending more cash on sporting goods. The Chinese sportswear market is forecast to be worth over $700 billion in 2025 (more than tripling from 2017). And enthusiasm for sporting events is growing rapidly – there were more than 400 marathons held in China last year, up from a measly 22 in 2011 – and all these athletes will need gear. Furthermore, the Chinese government is concerned about growing levels of obesity and has a plan – “Healthy China 2030” – that champions health as a habit.