COLUMBIA will acquire the remaining 40% stake in its Shanghai joint venture from Swire

Recently, Columbia Sportswear Company announced that it will acquire the remaining 40% stake in the joint venture Columbia (Shanghai) Trading Co., Ltd. from Swire Resources Limited. Subject to various conditions, including approval from Chinese regulatory authorities, the acquisition is expected to be completed around January 1, 2019. Upon completion, Columbia (Shanghai) Trading Co., Ltd. will become a wholly-owned subsidiary of Columbia Sportswear Company.

Tim Boyle, President and CEO of Columbia, said: “We appreciate Swire Resources’ contributions to the success and growth of the Columbia brand in China. Over the years, they have been an outstanding partner, and we look forward to continuing our strong relationship in Hong Kong and Macau. The performance of the Shanghai joint venture since its establishment in 2014 has been very satisfying. We have made the development of the Columbia brand in the Chinese market a long-term strategy, and this acquisition aligns with our accelerated investment approach—investing in brand-led, consumer-first businesses in areas with the highest growth potential for our existing brands.”

Columbia (Shanghai) Trading Co., Ltd. commenced operations on January 1, 2014, with its headquarters in Shanghai. According to the agreement, Columbia owns 60% of the joint venture, while Swire Group holds the remaining 40%. The initial cooperation term was set at 20 years, but the agreement also includes a clause allowing the purchase or sale of minority stakes at any time after the fifth year.

In 2017, Columbia’s total sales in China amounted to approximately $168 million, with a high single-digit growth expected in 2018. Columbia stated that future plans for its China division include continued investment in brand building in China, as well as increasing directly operated and dealer-operated stores. The existing management team, employees, and dealers will remain unchanged, and Jason Zhu will continue to serve as General Manager of Columbia (Shanghai) Trading Co., Ltd.

As of December 31, 2017, Columbia (Shanghai) had a total of 86 directly operated stores in the Chinese mainland market, established sales channels across multiple e-commerce platforms, and maintained distribution relationships with nearly 50 wholesalers, covering about 750 retail outlets.

After Columbia completes the acquisition of the remaining 40% stake in the joint venture from Swire Resources, the latter will continue to handle its distribution business in Hong Kong and Macau.