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.
Write to Euan Conley at firstname.lastname@example.org
(END) Dow Jones Newswires
January 11, 2018 12:57 ET (17:57 GMT)