Export firm Li & Fung has bought Marks & Spencer footwear supplier Peter Black International and will use the acquisition as a springboard for expansion across Europe.
The £48.1 million acquisition of Peter Black, which specialises in footwear and personal care, will significantly expand Li & Fung's potential customer base in the UK.
Peter Black is M&S's largest footwear supplier. It also supplies Tesco, Sainsbury's, Next and Body Shop and has sales of more than £240m.
Although Li & Fung sources a small amount of footwear and accessories itself, its main focus has been on clothing. Most of its sales are in the US.
Hong Kong-based Li & Fung said it planned to build a £500m business in the UK and Europe through further acquisitions, consolidating what it calls "a fragmented supply chain" across the continent.
Peter Black chairman Gordon Black said the deal would enable the supplier, whose head office is in Keighley, West Yorkshire, to broaden its offer beyond its core footwear, accessories and personal care range. "The globalisation of the supply chain for consumer products is now a reality and the timing of this change is absolutely right. (This deal) will sharpen our competitive edge and enable us to offer our customers a broader range of products," he said.
Li & Fung bought Peter Black from investment firm Endless just 18 months after Endless backed a management buyout of the business. Endless said it had realised a three times return on its initial investment in 13 months and that the sale paved the way for it to back similar Peter Black-type businesses.
The Li & Fung Group last week announced its strongest first-half growth since 2000. For the six months to June 30, group turnover was up 35% on last year to HK$37.7 billion (£2.43bn). Core operating profit rose 38% to HK$1.05bn (£67.6m).
Separately, Li & Fung bought US outdoor brand Regatta for US$148m (£74.5m) last week. As well as Regatta the company designs and sources US brands including Daisy Fuentes, and supplies the likes of Kohl's, Wal-Mart and JC Penney.