PE firm L Catterton partially exits Chinese mall operator Sasseur

An outlet operated by Sasseur REIT in Chongqing, China.

Global consumer-focused private equity firm L Catterton has divested a significant portion of its stake in China’s mall operator Sasseur Cayman Holding Limited, the sponsor of listed Sasseur REIT.

The PE firm has substantially reduced its deemed shareholding from 58.86 per cent to 1.36 per cent, according to a regulatory filing.

Prior to the transaction, L Catterton held 22.8 per cent of Sasseur Cayman through Great World Shanghai and 1.36 per cent of Sasseur REIT through its Sparkling Gateway unit. Therefore, the total deemed interest by L Catterton in the REIT was 58.86 per cent. Following the buy-back of the sponsor, Sasseur Cayman, as the PE firm’s shareholding in the sponsor has fallen below 20 per cent, it was not deemed to have interest in the REIT.

The divestment was part of L Catterton Asia’s ongoing efforts to optimize current portfolio holdings, and “represents a normal course of action for the fund”, the firm said in a statement.

“We continue to strongly believe in the long-term growth prospects of Sasseur and the opportunities it offers to investors in terms of exposure to China’s fast-growing outlet mall industry. We will continue to support the company’s growth initiatives as a Sasseur shareholder,” said L Catterton Asia chairman and managing partner Ravi Thakran.

Growth prospects for China’s outlet sector remains solid, with the fastest sales growth among the retail segments in China, even outpacing that of e-commerce, Sasseur said in another statement. The growth of outlet sales in China is projected to expand at approximately 25 per cent annually for the next five years to approximately RMB640 billion ($93 billion) by 2030.

L Catterton Asia, along with Ping An Real Estate and Warburg Pincus, were among early backers of Sasseur REIT. Warburg Pincus reportedly exited the mall operator prior to its $303-million IPO earlier this year. It was the first outlet mall to be listed in Asia. Sasseur REIT’s portfolio comprises four retail outlet malls located in fast-growing cities in China such as Chongqing, Kunming, and Hefei.

In addition to Sasseur, L Catterton Asia’s investments include Trendy International, Pepe Jeans, Gentle Monster, YG Entertainment, and Impresario Entertainment & Hospitality.

L Catterton, established in 1989, oversees over $15 billion of equity capital across six funds that have made over 200 investments in the consumer sector across the globe.

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