Prime and SRL agree to merge
01/04/2008
A merger between Prime Tanning, headquartered in Berwick, Maine, and Shanghai Richina Leather Company will form what the companies are calling “the world’s largest premium leather make”.
The name of the new company will be Prime Leather International and it will have the capacity to finish more than 150 million feet of leather annually.
Currently, Prime Tanning operates the largest vertically wet blue and side-leather finishing tanneries in North America with capacities up to 125 million feet and 55 million feet, respectively.
Shanghai Richina Leather, or SRL, finishes more than 96 million feet of leather annually and is a leading supplier to the bovine shoe, lambskin garment and automotive leather markets.
"The merger of Prime and SRL will be a landmark transaction combining the enormous production and technological synergies of the two companies for the benefit of our global base," said Robert Moore, CEO of Prime Tanning.
Moore will become CEO of the new company and a board of directors will be comprised of officers from both companies.
Shanghai Richina Leather CEO Roger Wang said his company has been working closely with Prime since Prime became its principal wet blue supplier in early 2006.
"We have gotten to know the Prime team and value the strong synergies between us," he said. "This merger will create the undisputed global leader in premium bovine fashion leathers for the footwear and specialty markets while significantly strengthening our capabilities in our lambskin garment and automotive leather divisions."
The merger, as explained in a press release distributed Monday, will be structured in a three-step process. On May 1, the companies will make a management agreement that will combine their global management, marketing, sales and customer service teams. Then the companies will combine the balance of their operations through a merger or contribution agreement as soon as they are able. Lastly, the new, merged company will seek a listing on an Asian stock exchange at the earliest possible time according to market conditions.
"We will maintain Prime's unsurpassed standards for product innovation, quality and environmental stewardship," Moore said.
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