JD Sports Fashion to rescue Champion

Wednesday, 26 January 2011

FashionUnited Top 100 closed Tuesday at 1,200.03, downing by 6.4. Traded apparel companies were performing lower than last week, showing themselves cautious in a session owned by strategic movements announced by the likes of JD Sports Fashion, buying Irish Champion,or Prada, to present an IPO in Hong Kong.

Awaiting to January 27 when it will review the company's fourth quarter and FY 2010 financial result, shares of Columbia Sportswear saw unusually high trading volume on Tuesday. Approximately 245,027 shares changed hands during mid-day trading, an increase of 120.57% from the previous session. The stock last traded at $59.99, or in other weeks, the shares gained 2.17%.

UK based JD Sports Fashion protagonized Tuesday's session after announcing a deal to buy loss-making Irish store chain Champion for a nominal sum. The British athletic firm also said it had agreed to advance 17.1m euros (£14.74m) as a secured loan to allow Champion's outstanding debts to be settled.

Champion, which has its headquarters near Dublin was founded in 1992 and operates 22 sports clothing and footwear stores in Irish town centre and shopping centres. In a stock market statement, JD said Champion turned over 54m euros (£46.56m) in 2009 and posted pre-tax losses of 4.9m euros (£4.22m). The market welcomed the agreement with caution, what supposed a slight loss for the sportswear firm, which ended down by 0.06%.

Those shares seeing gains included Burberry rising 3.2% to 1063p, while Next was off by 3.13% to 2075p and achieving then the second worst place within the international fashion benchmark index.

In India, apparel exports are expected to decline by over three per cent to USD 10.2 billion in 2010-11 year-on-year, due to the higher cost of fabrics in the local market. “The rising prices of cotton yarn have impacted garment exports. The increase in cost of apparels has shifted foreign buyers to other neighbouring markets like Bangladesh and Vietnam, which are cost-effective,” Apparel Export Promotion Council (AEPC) Secretary General Vimal Kirti Singh told PTI. Koutons closed down by 0.6%, while its compatriot Provogue India also accused the market warning with a loss of 0.81%.

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