Samsonite raises $1.25bn in Hong Kong IPO
Published: 10th Jun 2011 07:59:33
Samsonite is to raise US$1.25bn (£767m) in an initial public offering in Hong Kong, the BBC has learned.
The 100-year-old luggage maker will sell shares at HK$14.50 each, the low-end of a proposed price range, a person close to the deal told the BBC.
It is the latest foreign company to seek a Hong Kong listing. Fashion house Prada is looking to raise $2.6bn.
But the pricing of the Samsonite deal could mean that interest is not as strong as some had hoped.
Analysts said that the companies would struggle to obtain top prices as poor market sentiment had dampened investor appetite.
Hong Kong's Hang Seng index has fallen in recent weeks.
Huaneng Renewables, the wind-power unit of China's biggest electricity producer, dropped as much as 11% on Wednesday - its first day of trading in Hong Kong.
"The Samsonite IPO is a very big size and the valuation is too high," said Peter Lai, a director at DBS Vickers in Hong Kong.
Samsonite had proposed to sell 671.2 million shares in a HK$13.50 to HK$17.50 range.
The shares are due to begin trading on the Hong Kong stock exchange on 16 June.
Samsonite, which is owned by private equity group CVC and the Royal Bank Of Scotland, will use the proceeds to pay off its debts.
CVC bought Samsonite in 2007 for $1.7bn at the height of the credit boom.
But the company struggled when travel was hit by the financial crisis and Royal Bank of Scotland ended up taking a 30% stake as part of a debt restructuring.
The company is betting on growth in Asia, where leisure travel is becoming increasingly affordable.
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Harvard CitationBBC News, 2011. Samsonite raises $1.25bn in Hong Kong IPO [Online] (Updated 10th Jun 2011)
Available at: http://www.ukwirednews.com/news/160931/Samsonite-raises-1-25bn-in-Hong-Kong-IPO [Accessed 16th Apr 2014]
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