Chinese conglomerate Fosun will buy a controlling stake in Austrian luxury lingerie brand Wolford, Reuters reported on March 2. Wolford opened a flagship store in Shanghai in 2013, where tights retail for up to $350.
Fosun will not only pay 33 million euros ($40 million) to Wolford for a 50.9 percent stake, but also stump an additional 22 million euros as part of a capital increase. They are also offering 13.67 euros per share to buy out other shareholders. The deal comes shortly after Fosun’s proposed deal with La Perla stumbled.
In the past few months, Chinese companies have been aggressively buying up fashion brands. Shandong Ruyi, one of China’s largest textile producers, bought Swiss clothing brand Bally in early February, and was reportedly in talks with Sir Phillip Green to acquire Arcadia, which owns Topshop. At the end of last year, Hemei Group bought controlling stakes in Rainbow Group in Macau, while Septwolves acquired an 80 percent stake worth $36 million in Karl Lagerfeld Greater China Holdings (KLGC), which owns the Karl Lagerfeld trademark in China.
Foreign luxury lingerie brands have also become more bullish on China. Last spring, La Perla hired Liu Wen (刘雯) to be its first Chinese brand ambassador and opened four flagship stores in China. Victoria’s Secret also joined the fray, finally opening its first flagship store in Shanghai last year.
Fosun’s latest acquisition, however, signals a shift in the luxury market, as its the first time a Chinese company has acquired a Western luxury lingerie brand.
In the past, Chinese people were more likely to buy luxury bags or clothes, which allow them to show off to their family and friends, rather than something like lingerie, which is for a woman herself or her romantic partners. That has started to change.
Chinese millennials now value luxury lifestyle experiences more than logos and name tags, Chloe Reuter, co-founder of The Luxury Conversation, told Jing Daily in New York last month. Lingerie is one luxury that can be enjoyed without being too conspicuous.
In 2016, Euromonitor projected that the Chinese women’s underwear market is expected to have a retail value of $25 billion by 2017 — double that of the United States — and would grow to $33 billion by 2020.
It is worth noting that although most Chinese consumers are familiar with America’s Victoria’s Secret, Italy’s La Perla, and Germany’s Triumph, there are several popular domestic luxury lingerie brands, such as Gujin (古今), Embry (安莉芳), and Aimer (爱慕), that dominate the market. Compared to other luxury items, foreign lingerie brands expansion into China is just beginning.