China’s Xinao Textiles to Sell 40% of Todd & Duncan to UK Unit’s Key Client
Tang Shihua
DATE:  7 hours ago
/ SOURCE:  Yicai
China’s Xinao Textiles to Sell 40% of Todd & Duncan to UK Unit’s Key Client China’s Xinao Textiles to Sell 40% of Todd & Duncan to UK Unit’s Key Client

(Yicai) Dec. 17 -- China’s Xinao Textiles is selling a 40 percent stake in Todd & Duncan to Barrie Knitwear, a major customer of the British cashmere yarn spinner, for GBP18.8 million (USD23.8 million) to bolster their ties and boost the unit’s liquidity.

Xinao will pump an additional GBP9.5 million (USD12 million) into Todd & Duncan to boost its capital, the Jiaxing-based maker of worsted wool yarn said yesterday. Barrie will then pay GBP18.8 million in cash for 10.7 million new shares of Todd & Duncan, reducing Xinao’s stake to 60 percent.

The sale will enable Croydon-based Barrie, one of the oldest cashmere knitwear producers in Scotland, to work more closely with its key supplier, Xinao said. The deal will also help Todd & Duncan upgrade its machinery and efficiency.

Xinao’s shares [SHA: 603889] ended flat at CNY7.75 (USD1.06) a share in Shanghai, after swinging between a 10 percent gain and a 5.5 percent loss earlier in the day.

Xinao paid CNY42 million (USD5.7 million) in 2020 to take over Todd & Duncan, which provides luxury cashmere yarn to world-class brands and has many long-standing clients. Xinao said at the time that the acquisition would give the Chinese firm its first overseas manufacturing base, thereby integrating its domestic and foreign businesses and improving its global footprint.

In the first nine months of this year, Todd & Duncan lost CNY62,300 (USD8,500) on revenue of CNY219 million (USD30 million), according to its last financial report. The Kinross-based business posted net profit of CNY8.2 million (USD1.1 million) on revenue of CNY267 million for last year.

Editor: Kim Taylor

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