Fila Korea to split from Fila Global
Gene Yoon, Chairman & CEO of Fila Global
Gene Yoon, Chairman & CEO of FILA Global
Fila Korea, a maker of sports apparel and shoes, is to be reborn as a Korean company, the first case of a foreign-invested firm transforming itself into a Korean-owned one.
In a statement issued yesterday, the company said that its chairman, Yoon Yoon-soo, and five other top managers will purchase the Fila Korea shares held by Fila Global, which is managed by Sports Brand International.
Cerberus, a private U.S. investment fund, holds an 85 percent-stake in Sport Brands International of New York. Mr. Yoon has 3.75 percent.
The company said it expects the purchase to cost $127 million, which will come from Mr. Yoon’s personal funds as well as through private equity funds and public issues.
An official with Fila Korea who requested anonymity said of the buyout: “We plan to re-invest profits made in Korea back into the Korean market.” The official added that profits, previously transmitted abroad, would be used to market Fila products in Korea.
Fila Korea, however, will continue to use the same brand name and the logo, and will jointly develop products. The company will pay half the royalty fees, or about 3.5 percent of its sales to the parent.
In November, the company set up a new holding company, “Fashion Flower,” to prepare for the takeover. They plan to list it on the Korea Stock Exchange by 2007.
Fila Korea’s sales in 2003 were 381.1 billion won, with a profit of 16.1 billion won. In domestic sales, Fila Korea ranks second, behind Hwaseung Corp., in the sports apparel and shoes market.
Fila Korea, established in 1991, grew under Mr. Yoon’s leadership. He began to invest in Fila Global when the group’s management changed from Italian ownership to SBI Holdings in June 2003.
In a statement issued yesterday, the company said that its chairman, Yoon Yoon-soo, and five other top managers will purchase the Fila Korea shares held by Fila Global, which is managed by Sports Brand International.
Cerberus, a private U.S. investment fund, holds an 85 percent-stake in Sport Brands International of New York. Mr. Yoon has 3.75 percent.
The company said it expects the purchase to cost $127 million, which will come from Mr. Yoon’s personal funds as well as through private equity funds and public issues.
An official with Fila Korea who requested anonymity said of the buyout: “We plan to re-invest profits made in Korea back into the Korean market.” The official added that profits, previously transmitted abroad, would be used to market Fila products in Korea.
Fila Korea, however, will continue to use the same brand name and the logo, and will jointly develop products. The company will pay half the royalty fees, or about 3.5 percent of its sales to the parent.
In November, the company set up a new holding company, “Fashion Flower,” to prepare for the takeover. They plan to list it on the Korea Stock Exchange by 2007.
Fila Korea’s sales in 2003 were 381.1 billion won, with a profit of 16.1 billion won. In domestic sales, Fila Korea ranks second, behind Hwaseung Corp., in the sports apparel and shoes market.
Fila Korea, established in 1991, grew under Mr. Yoon’s leadership. He began to invest in Fila Global when the group’s management changed from Italian ownership to SBI Holdings in June 2003.
by Kwon Hyuk-joo, Kim Ji-soo <tarzan@joongang.co.kr>
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