Club Med set to back Chinese bid this week
By Astrid Wendlandt and Matthieu Protard
PARIS Jan 4 (Reuters) - French holiday company Club Mediterrannee is expected to back an offer from a consortium led by Chinese billionaire Guo Guangchang this week after Italian rival bidder Andrea Bonomi declined to raise his offer on Friday.
Bonomi's decision puts an end to the longest-running bid battle in recent French corporate history and removes uncertainty over the future of struggling Club Med, which is fighting weaker demand in Europe and heavy restructuring costs.
Investors are hoping Club Med's new owners will invest in the operator's upscale repositioning and expansion in markets such as China, which should widen a client base historically dominated by Europeans.
Guo, whom Forbes estimates has a net worth of about $4.3 billion, has described Club Med as an ideal investment to tap booming demand among China's increasingly affluent city dwellers for the kind of leisure resorts the French company offers.
The board of Club Med has said in the past it would only respond to the last standing offer for the company. It is expected to make a statement on the Chinese bid in the next few days, a spokesman for the Paris-listed company said on Sunday.
French market watchdog AMF for its part, will vet the offer led by China's richest man, valuing Club Med at 939 million euros ($1.13 billion), and set out a timetable.
Guo's 24.60 euro a share offer was 0.60 euro higher than Bonomi's last bid and was the eighth offer for Club Med since May 2013 when Guo first offered 17 euros.
The Chinese offer values Club Med at more than 15 times the company's current estimated underlying earnings, putting it at a premium to the sector's average of around 13 times. Continuación...