Kering SA(KER.FR) said Thursday that it plans to reduce its stake in sportswear company Puma AG (PUM.XE) by distributing around 70% of outstanding Puma shares to Kering shareholders.
Following the distribution, the Paris-based luxury goods company would reduce its stake in Puma to 16%, down from 86.3% currently.
The move is meant to reinforce Kering's status as solely a luxury company, it said. Kering is best-known for its brands including Gucci, YSL and Balenciaga.
The company added that Artemis, which holds 40.9% of shares in Kering, is set to become Puma's long-term strategic shareholder with an ownership of around 29%.
Separately, Puma said it welcomed the move which will increase its free float to about 55%, from 14% currently.
"The full support of both Artemis, which would become Puma's main shareholder, and Kering, as a significant minority shareholder, reflects a strong confidence in the company's ability to continue to deliver its strategic and financial objectives," said Francois-Henri Pinault, Kering's chief executive and chairman.
Kering's shareholders are set to vote on the transaction at the company's annual general meeting on April 26.
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(END) Dow Jones Newswires
January 11, 2018 12:57 ET (17:57 GMT)