Club Méditerranée board approves Axa-Fosun $729 mn bid

The board of Club Méditerranée has approved a revised €17.5-per share bid from its two majority shareholders, valuing the French leisure company at €557 million ($729 million).

Last week, AXA Private Equity and China's largest privately-owned conglomerate Fosun International, holding a little over 19 per cent stake, offered to pay €17.50 a share for the stock they do not already own in the French-owned global leisure chain.

The revised offer is higher tha their offer of €17 a share earlier made in May.

The board of Club Med yesterday voted unanimously in favour of the revised offer and shareholders holding 34 per cent stake, including AXA PE and Fosun, have agreed to tender their shares to the offer.

Post closing, Club Med will be operated through a joint venture, with Fosun and Axa holding 46 per cent each, and the remaining 8 per cent held by 400 Club Med managers.

Club Med, which was started in 1950 by former Belgian water polo champion, Gérard Blitz, invented the all-inclusive holiday resorts in France and is today present in 40 countries through its 70 Club Med Resorts, including beach resorts and ski resorts, such as Aime la Plagne in France, Agadir in Morocco, Cancun in Mexico and Kabira in Japan.

With annual revenues of more than €1.3 billion, Club Med also operates a number of villas and the Club Med 2 cruise ship as well as offers business conferences hosting services within its resort villages. About 1.2 million people have their vacations at Club Méd resorts every year.

When individual travel market opened up to Chinese tourists in 2003, Club Med established sales offices in Shanghai, Beijing, Guangzhou and Chengdu.

Club Méd has decided to strengthen its presence in upscale resorts, by opening five villages between 2010 and 2015. Club Med has already initiated new projects in China, in particular its first Village, as a ski resort, in Yabuli, the largest Chinese ski station in north-east China, which will be opened by the winter season of 2010.

Club Med's goal is to attract 5 to 10 per cent of potential Chinese visitors to 4- and 5-star vacation resorts by 2015, representing just 0.2 per cent of the total Chinese population.

Hong Kong Stock Exchange-listed Fosun, run by chairman Guo Guangchang, has investments in pharmaceuticals, property development, steel, mining, retail, services and strategic investments, with annual revenue of more than 35 billion RMB.