The top shareholders of the iconic Club Mediterranean are currently formulating a plan to bid for the holiday firm. The price pegged is at Eur541 million or US$700 million.
The goal of the sale is to accelerate the firm's focus into fast emerging markets and veer from Europe's recession hit economy. The bid is a consortium consisting of the top shareholders together with Fosun International of China and AXA Private Equity. The offer by the consortium is at Eur17 per share for stock that the shareholders do not already own.
The price offer had a 23% premium added to the closing price of the stock at Friday's closing.
Club Med has been the pioneer and market standard for the all included holiday vacation resort. The company was established in 1950 and listed publicly in 1966. It had recently fell on hard times, because of budget conscious competition as well as an unsuccessful expansion. Now, with the sputtering European economy, its reintroduction as an upscale vacation operator was not taken very well because of high costs.
At early morning trading, Club Med shares jumped by 22.9% upon the news of the Eur 17 per share offer being made public. Back in 2009, the share values of the company was below Eur8 per share, but this current value is still well below the 2007 high of Eur50 per share.
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