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June 22, 2018

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Baccarat hopes for a change in Fortune

Source: AFP | 00:01 UTC+8 June 22, 2018 | Print Edition

A Chinese businesswoman who is an avid buyer of Baccarat glassware added the famed French crystal maker to her collection of business assets yesterday in a 164-million-euro (US$189 million) deal.

Coco Chu, founder of the Hong Kong-based Fortune Fountain Capital, has completed the acquisition, whose hand-crafted sculptures and champagne flutes have been made since the reign of Louis XV.

Baccarat announced that Fortune will buy an 89 percent stake held by the US investment firms Starwood Capital and L Catterton, which have struggled to revive the 250-year-old brand.

Baccarat’s luster has faded as it failed to benefit from the explosive growth in demand for luxury items in emerging markets, particularly in Asia.

It began falling into the red when the global financial crisis struck in 2008, only once posting a small annual profit until regaining its footing in 2016.

During those years investments in new designs and marketing were scaled back as losses accumulated.

“This isn’t the kind of growth seen in a luxury company,” said Eric Rogue, a union delegate at the company’s glassworks in the eastern town of Baccarat, which eventually gave its name to the glassworks founded by royal decree in 1764.

“We’re a luxury brand that could be developing much faster than we are now,” he said last month, pointing to annual revenues that have stagnated at around 150 million euros over the past five years.

Baccarat’s designs are found in temples of taste around the world, its sculptures gracing the storied Crillon Hotel in Paris, its glittering chandeliers hanging in palaces and museums.

Prices for a pair of champagne flutes — a stalwart on wealthy wedding registries — start at 300 euros, while a best-selling coffret of six colored tumblers lists for 1,030 euros.

This month it unveiled a collection of 100 sculptures of Zinedine Zidane’s foot costing 40,000 euros each.

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