When it comes to the flotation of luxury goods companies these days, bankers are fast getting in the habit of avoiding London. Hence, when the London-based private equity group Doughty Hanson and other shareholders revealed they were set to sell shares in Tumi, the premium travel bag company, it came as little surprise that the $300m share offering headed for New York. The listing is being led by Goldman Sachs, Credit Suisse and JP Morgan.
Other luxury sector IPOs, including Samsonite and Graff Diamonds, went or have chosen to go the far east, where bankers say investors have a better understanding of the luxury market. Even Milan is hosting the float of a luxury company, Brunello Coccinelli, the retailer of cashmere fashion.
One source close to the Tumi flotation says: “The UK is a good place to float for resources and mining groups but no longer for luxury. New York or Hong is preferable. You’re selling to a larger consumer audience and a market where there’s greater investor expertise.”
It all seems light years away from 2002 and the era of Cool Britannia when Burberry parent GUS didn’t think twice about floating the luxury brand in London. Luckily Burberry doesn’t seem ready to jump ship. “We’re happy with our London listing and have no reason to raise capital elsewhere,” said a Burberry source.