Prada squeezes underwriters
Italian fashion house Prada has proved to be a tough customer for underwriters of its up to $2.6bn (£1.6bn) initial public offering (IPO), having capped the overall commission at 1.9 per cent of the total offer – making it among the lowest fees paid in recent Hong Kong IPOs. Prada revealed in its prospectus released yesterday that it will pay a base underwriting commission of 1.2 per cent and up to 0.7 per cent in incentive fees for the underwriting team. Separately, a source said that the offer is five times subscribed. Last year, American International Group paid two per cent commission for its massive $20.5bn flotation of AIA, which was managed by 11 underwriters. The 1.9 per cent underwriting fee compares with 3.25 per cent paid by Samsonite, which last week raised $1.25bn by selling shares at the bottom of a revised range.