Finland's leading clothing company, the P.T.A. Group, signed a contract with Optiva Bank Jan. 28, according to which the company will buy a 43 percent holding in Klementi from Fine Holding, a subsidiary of Optiva Bank.
The deal will open up new growth opportunities for both companies.
"This will guarantee a supply to the Finnish partners and it will also give them an opportunity to expand to new markets," said Madis Vooras, managing director of Klementi.
Vooras added that the strategic investor would give Klementi stability since speculators had been buying and selling the stock, making any long term investments and strategies difficult.
"A strategic investor will also make our company stronger, as the ownership was very unclear before the deal," said Vooras, who does not see any automatic changes in the company and forecasts normal development for next few years.
Kari Mattsson, from the P.T.A. Group, agreed that there would be few changes in the near future and said that the partnership was a natural fit.
"There will be no strategic changes in the company in the short run perspective. The management will continue. We can support them in marketing and vice versa. Klementi is well know in the Baltics and P.T.A. has an extremely well established trademark in Finland and Sweden," said Mattsson.
P.T.A. is a fashion manufacturer located in Kuopio, the eastern part of Finland, with a sales of about $32 million last year.
The P.T.A. Group has been a client of Klementi since 1991. Klementi supplies the P.T.A. Group with clothing accessories. According to Vooras, Klementi's growth and development owes a lot to their cooperation with the P.T.A. Group, one of its biggest clients, and as a result of the transaction the connections will tighten further.
At the same time, Klementi will continue producing and marketing its products in the Baltic countries and Scandinavia under the same trademark.
Vooras said people in the Baltics and Finland are choosing the products of Klementi and its competitors Baltika and Virulane mostly on the basis of trademark and not price. Klementi's trademark is not widely known on the markets of the developed countries.
There are also lots of foreign competitors for Klementi as the market is open to all importers, says Vooras.
In 1997, the company earned a 5 million kroon ($371,000) profit on a 98 million kroon turnover. Its management has predicted a 125 million kroon turnover for 1998.