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SCMP Reporter

WATCH and jewellery manufacturer Egana International Holdings has spent $54 million acquiring German jeweller Speidel's business and trademark.

Company non-executive director David Wong Wai-kwong said the integration of Speidel into Egana would see the transfer of 90 per cent of Speidel's production from Germany to China.

He said this would reduce operating costs and that the profit margin would rise by 20 percentage points.

'The current profit margin for Speidel jewellery is 35 per cent,' he said.

'After reducing the cost it may rise to 55 per cent.'  Speidel's last annual turnover was 20 million marks (about HK$108.20 million).

 Mr Wong said the company had a five-year plan to open the Asian market to Speidel and expected to have a five million mark profit after the first year of operation.

 'We expect the Hong Kong market will contribute 50 per cent to the five million mark business turnover in the first year,' he said.

 He said China and Japan were expected to contribute between 20 and 30 per cent to the business.

  The company announced an exceptional in its interim results of $3.7 million, being compensation from Benetton International for terminating a contract with Eco Swiss China Time.

 The company said it had no idea when the US$23.75 million compensation would be paid.

 Egana International executive director Peter Lee said the Speidel trademark would further boost the company's image.



Egana International acquires Speidel name