Kering to Spin Off Puma, Saying Goodbye to Sports Lifestyle

Puma Trace Platform

Shedding Puma, meanwhile, would turn Kering into a pure player in the high-margin luxury business, where it rivals larger peers such as French conglomerate LVMH.

Gucci-owner Kering plans to spin off German sports brand Puma to the French conglomerate's shareholders as it sharpens the group's focus squarely on its luxury brands.

Puma shares were down 4.4 percent at the close, with Kerin down nearly 1 percent.

We reached out to Volcom CEO Todd Hymel about this news, but he declined to comment beyond the press release Kering issued about the Puma decision.

The holding company of the Pinault family, Artemis, which owns almost 41 percent of Kering, plans to be a long-term strategic investor in Puma with a stake of approximately 29 percent, the statement said.

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The Paris-based company said Thursday it would ask shareholders to approve distributing 70 percent of Puma's outstanding shares, which would reduce Kering's stake to 16 percent from 86 percent.

"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.

The disposal is likely to be a boost for Kering shares, analysts said.

"The Puma divestiture materializing sooner - rather than later - will add oomph to the stock", Exane BNP Paribas analyst Luca Solca said in a note. The number of Puma's publicly traded shares would be increased to approximately 55 percent, a statement from Kering said.

The sports goods company will probably now be a candidate for inclusion in Germany's mid-cap index, Duplaix said.

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