Suit maker Bagir Group PLC (LON:BAGR) doubled in value as a major Chinese textile group took a majority stake and agreed to help it to win business with global clothes groups.
Shangdong Ruyi Technology, one of China’s top 100 multi-national enterprises with listed subsidiaries in China, France and Japan, will invest US$16.5mln for a 54% holding.
READ: Black is the new red as clothing maker Bagir returns to profit
Eran Itzhak, Bagir’s chief executive, said having Shandong Ruyi Group as a key shareholder and partner would enable it to exploit the opportunity presented by its Ethiopian manufacturing base far quicker and with more certainty than it could independently.
The money will be used to expand the suit trouser business and establish the jacket production lines in Ethiopia, he added.
Shandong Ruyi is paying 3.5p per share for its holding, a 155% premium to the price before the shares were suspended on Monday but about the same as last December’s fundraising.
Since then there have been two profit warnings due to a slowing flow of orders.
Shares in Bagir jumped 118% to 3p.