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Hamleys in talks with Chinese buyer

Article By: ,  Financial Analyst
October 26, 2015 8:36 AM

Most famous for its flagship store on Regent Street, Hamleys is a 255-year-old toy retailer. Its seven-storey toy shop in London is a particularly popular stop for Christmas shoppers and tourists in the capital.

Last week, it emerged that the company's French owners were expected to complete a £100 million deal, selling the business to C.banner International Holdings.

In a statement, the Chinese company said it was "in the process of negotiating and finalising the definitive documentation with a view to entering into a legally binding agreement in the near future". However, the potential buyer made clear that no definitive agreement had been reached.

International ownership

Despite the company's foreign ownership, Hamleys is considered a British icon. William Hamley opened the first shop in 1760 and called it Noah’s Ark. Mr Hamley was a Cornishman from Bodmin, and he stocked tin soldiers, wooden horses and rag dolls.

In 2003, Icelandic retail investor Baugur bought Hamleys for £59 million. During the financial crash, Baugur got into difficulties and in 2009, Icelandic bank Landsbanki took control of the business.

Then, in 2012, the firm was sold to French retailer Groupe Ludendo, a company that operates hundreds of toy shops in France, Belgium, Switzerland and Spain.

Since moving to foreign ownership, Hamleys has expanded across the UK, with new stores opening in Cardiff, Glasgow and Manchester. More recently, the company has also expanded over seas. Earlier this year, it opened Europe's largest toy store in Moscow. There is also talk expansion to the US market.

Chinese interest

C.banner International, which specialises in women’s footwear including brands MIO and Sundance, says it is interested in the toy company because it wants to diversify its offering. It says that Hamleys has a strong brand identity and it also wants to develop a "strategic partnership" to distribute children's products via House of Fraser, which Sanpower, a Chinese conglomerate, bought last year.

Chen Yixi, chairman of C.banner said: "A strong brand is an outstanding resource. Acquisition of a world-renowned brand could greatly enhance the company’s competitive advantages."

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