Italian furniture brand Natuzzi and China’s Kuka furniture company have agreed to make the company’s wholly owned Chinese subsidiary Natuzzi Trading (Shanghai) a joint venture.
The JV agreement is aimed at expanding the company’s retail network in Mainland China, Hong Kong and Macau. The company, the JV and Kuka have also entered into an agreement for the sale and purchase and subscription of shares In Natuzzi Trading (Shanghai).
The agreements follow the execution of a preliminary agreement last month. Under the agreements, Natuzzi and Kuka will own, respectively, a 49 and a 51 per cent stake in the JV, which will distribute Natuzzi Italia and Natuzzi Editions branded products through a network of single-brand directly run stores and franchised stores in China, Hong Kong and Macau, as well as through online stores.
Kuka will invest a total of €65 million (US$80 million), of which €35 million will be contributed to the JV for the subscription of a capital increase of US$567,869, and €30 million will be paid to the company as consideration for the transfer of US$486,744 of registered capital interest from the company to Kuka.
The JV will be granted the perpetual and exclusive distribution licence for the Natuzzi Italia, Natuzzi Editions and other relevant trademarks for a consideration of €15 million.
The transaction is subject to applicable authorisations, regulatory filings and approvals. Assuming these conditions are met, it is expected the closing will occur by August 22.