BY betting on the future spending power of China’s consumer market, Samsonite is the latest in a string of retailers looking to make the most of the country’s booming luxury goods market.
French skincare group L’Occitane priced a $700m initial public offering (IPO) in Hong Kong last year, and fellow aspirational brands Burberry and Prada are also wooing Asia’s investors.
Though Asia is currently Samsonite’s fastest growing market, making up around a third of its sales total, the company doesn’t quite fit the mould of the region’s other success stories.
Neither bargain basement nor luxury high-end, Samsonite luggage falls in the tricky mid-range price bracket – traditionally a harder sell, particularly in a country where fakes are plentiful and brand names highly prized.
Timed against a rush of similarly themed companies entering the market, it’s a risky move for the US-founded firm, which is only just recovering from having to be rescued by its biggest lender RBS through a debt-for-equity swap in 2009.
Hong Kong may have been the world’s top destination for IPOs for the past two years running, but for Samsonite it could be a step too far.