Chinese fashion group Shandong Ruyi’s creditors, including China Everbright Ltd, Tor Investment Management, Lindeman Partners, and Lindeman Asia, have taken over complete ownership of U.S. fiber maker Lycra. This transfer of ownership occurred after Shandong Ruyi defaulted on a $400 million loan. Previously, Shandong Ruyi had acquired Lycra from Koch Industries for $2.6 billion in 2019, financing the purchase with approximately $1 billion in borrowed funds.

The new creditors-turned-owners have expressed their commitment to safeguarding and strengthening the future of Lycra, assuring that the company will be insulated from the financial distress faced by its former shareholder. Lycra CEO Julien Born has also highlighted the support of experienced professionals who share the company’s long-term vision.

Representatives from Shandong Ruyi have not yet commented on the situation. The Chinese fashion conglomerate had previously pursued an ambitious acquisition strategy to establish a global luxury clothing empire, acquiring brands such as Aquascutum, Cerruti 1881, and SMCP. However, the heavy debt burden carried by the company, worsened by the impact of the COVID-19 pandemic, presented challenges for its expansion plans.

Useful links:
1. The LYCRA Company
2. Shandong Ruyi Technology Group