Samsonite sets price for its HK listing

 
City A.M. Reporter
LUGGAGE maker Samsonite, backed by private equity firm CVC Capital Partners, moved closer to a $1.5bn (£911m) Hong Kong initial public offering, setting an indicative range for the deal yesterday as it bets on Asian demand for global consumer brands.

Samsonite will join companies such as L’Occitane and luxury brands such as Prada and Coach that have targeted Hong Kong to raise their profile among Asian consumers or tap deep-pocketed investors to fund expansion in the region.

Luxembourg-based Samsonite will offer 671m shares in the IPO, with an indicative price range of HK$13.5 to HK$17.5 each, two sources with direct knowledge of the deal said.

About 82 per cent of the shares in the IPO are existing shares, with 18 per cent coming from a primary offering, said the sources, who declined to be named because the details were not yet public.

At the top end of its price range, Samsonite would be trading at 22 times its projected earnings in 2011, according to the consensus estimates of banks underwriting the IPO. That compares with an average P/E ratio of 20.1 times for Asia ex-Japan consumer companies.

Chinese company Powerland, which listed in Frankfurt in April and makes luxury handbags and suitcases, trades at a 7.7 times projected 2011 earnings, while US-based Coach trades at 20.7 times and British luxury firm Burberry, which is seeking a Hong Kong listing, trades at 22.1 times, according to Macquarie Research.

FAST FACTS | SAMSONITE
● Founded in Denver in 1910 by Jesse Shwayder

● Bought by CVC Capital Partners in 2007 from a consortium including Bain Capital.

● Did a debt-for-equity swap with its biggest lender RBS  in 2009 after a slump in sales.