France's PPR launches friendly takeover offer for Germany's Puma

French luxury goods group PPR SA said Tuesday it is buying a 27.1 percent stake in sporting goods maker Puma AG and plans to make a friendly takeover bid that values the German company at EUR5.3 billion (US$7.1 billion).

PPR, which owns the luxury goods company Gucci Group, said it was paying EUR1.4 billion (US$1.9 billion) for the stake in Puma held by Mayfair Beteiligungsfondsgesellschaft.

"Following this acquisition, PPR intends to launch a friendly takeover offer in cash on the remaining outstanding Puma shares at the same price" of EUR330 (US$441.11) per share, PPR said in a statement. It said it expects to complete the offer in early July.

Herzogenaurauch, Germany-based Puma welcomed the offer, saying its board "unanimously believes that PPR's engagement is in the best interests of the company and that the announced offer price per share ... for the voluntary public takeover offer is fair."

Puma is the world's third-largest sporting goods company after Nike Inc. of the U.S. and German rival Adidas AG.

In addition to Gucci and Yves Saint Laurent, PPR's holdings including the Fnac music chain and Conforama furniture chain.

"We guarantee Pumas continuity as an autonomous company within the PPR Group," PPR chief executive Francois-Henri Pinault said in Puma's statement. "There will be no changes with regard to staffing."

The company has been working to expand its reputation as a maker of lifestyle brands - clothes, shoes and accessories, such as eyeglasses - and expand in more regions and categories.

In 2006, Puma earned a net profit of EUR263.2 million on sales of EUR2.37 billion.

Puma shares opened up 7.7 percent in Frankfurt at EUR338.36 (US$452.29) following news of PPR's bid.

The stock already had gained more than 10 percent on Thursday, the last day of trading before the long Easter weekend, on talk of a takeover bid.

Mayfair is an asset management company for members of the Herz family, which founded Germany's Tchibo coffee and clothing retailer.