SMCP Resolves Shareholder Dispute, Recovers 15.5 Percent Stake

What's Happening?

The textile group SMCP, known for brands like Sandro and Maje, has resolved a significant shareholder dispute involving a 15.5 percent stake in its capital. This stake was illegally transferred in 2021 to Dynamic Treasure Group, a company based in the British Virgin Islands, by SMCP's defaulting Chinese shareholder. The High Court of Singapore ruled in favor of SMCP, leading to the return of the stake to European TopSoho, a Luxembourg holding company. This resolution comes after years of legal battles initiated by GLAS, a creditor entity that recovered a portion of SMCP's capital following the default of its majority shareholder, Shandong Ruyi.

Why It's Important?

The resolution of this dispute is crucial for SMCP as it clarifies its shareholder situation, allowing the company to focus on its growth strategy. The return of the stake provides stability and potential for future investment opportunities. SMCP has been navigating challenges such as the COVID-19 pandemic, inflation, and increased raw material costs due to geopolitical tensions. The legal victory may enhance investor confidence and support SMCP's efforts to leverage its brand desirability and operational agility.

What's Next?

GLAS, as a creditor, may now pursue the recovery of the 15.5 percent stake, potentially leading to a takeover bid. This could further consolidate GLAS's position, as it already holds 29 percent of SMCP's capital. Alternatively, creditors might opt to sell their shares to recoup their investments. SMCP is expected to continue implementing its profitable growth strategy, focusing on brand desirability and cost control.