Ruyi Group has launched an initial public offering for The Lycra Company to be traded on China’s new Science and Technology Innovation Board (STIB).
A Ruyi spokesman said details on how many shares would be offered or how much the company hoped to raise have not yet been determined.
Last month, Lycra Company CEO Dave Trerotola told Sourcing Journal such a listing “would be cool.”
“It would help our brand and give our employees something exciting, to own shares of Lycra,” he said. “But it’s not a goal I’m focused on. If we have an opportunity to go that route, we might do that, but it’s not an immediate goal of the company.”
The Lycra Co. now consists of 3,000 employees in 40 countries, with its global headquarters in Wilmington, Del. Trerotola, who noted that Lycra Co.’s annual revenue is $1.5 billion, said, “There’s opportunity for us to grow in the core business and there’s also opportunity in the personal care marketplace. In apparel, there’s opportunity for additional services to the market. We’re always on the lookout for differentiators, whether that’s a fiber or an apparel product line.”
Lycra’s relationship with Ruyi, Trerotola said, has proven beneficial for the sense of autonomy it has brought, while being able to call on its vast network and experience, particularly in China.
Trading on China’s Nasdaq-style stock market began this week, with 25 tech companies listed on what is being called the STAR Board, operated by the Shanghai Stock Market. The board is an initiative by the government to encourage more Chinese tech companies to list domestically by addressing concerns about governance.
Ruyi, one of the leading textile and fashion companies in China, said the listing will help Lycra build its Asian supply chain. At a ceremony at Lycra’s Jining, China, regional headquarters, Ruyi executives said Lycra landing on the capital market means it’s entering a substantive stage of operation.
In January, Ruyi Group completed its acquisition of Invista’s Apparel & Advanced Textiles business, including a robust portfolio of highly respected Lycra brands, including Lycra, Coolmax, Thermolite, Elaspan, Supplex and Tactel. The deal was reportedly valued at $2.6 billion for the business, and Ruyi said it plans to “further expand in the high-end spandex field through this acquisition.”
“As the top business in the field of global high-tech materials for textile fibers, Lycra has the absolute competitive advantage, since Lycra is the STIB preferred applicant who provides high-performance composites for the industry,” Ruyi said.
Lycra is the only spandex brand on the China exchange and, according to Ruyi, it “represents the most advanced technology in the field of spandex and controls a significant market share of high-end spandex.
Under the Ruyi Group, new fiber products launched by Lycra could achieve large-scale production in a short time, which could offset the gap in Lycra’s capacity in the Asian region, the company said.
“Asia is also a huge market for fiber consumption, with a strong demand for high-end textile and apparel products, and new fiber products,” Ruyi said. “This could help Lycra quickly occupy new profit growth points, as well.”