Prada May Mirror Samsonite’s IPO as Shares Fall in Gray Market Trading
Prada SpA may decline when it begins trading this week, following in the footsteps of companies such as Samsonite International SA that struggled to woo investors in Hong Kong debuts, premarket trading shows.
Prada shares fell as much as 2.5 percent to HK$38.50 to HK$39 in over-the-counter trading yesterday, said two people with knowledge of the transactions brokered by Jefferies Group Inc. (JEF) Prada sold shares in the IPO at HK$39.50 each, raising $2.14 billion.
“The fact that Prada will probably be trading down when it opens underlines the overall change of sentiment in Hong Kong’s IPO market,” said Josef Schuster, founder of Chicago-based IPOX Schuster LLC, which oversees about $2.5 billion. “You don’t see the initial pops anymore.”
Shares of the Milan-based luxury-goods maker are scheduled to start official trading on the Hong Kong Stock Exchange on June 24. Prada priced the stock below the middle point of the range used to canvass investors after a five-week slump on the benchmark Hang Seng Index. (HSI) Samsonite, which raised $1.25 billion in its IPO after scaling back the sale, dropped 7.7 percent on its first day of trading last week.
The gray market is an over-the-counter venue for the unofficial buying and selling of securities between institutions before their listing on a stock exchange. Prada’s shares were actively traded in the gray market, said one of the people, who declined to give a specific figure for the volume.
The Hang Seng Index added 0.3 percent today, paring losses in the past month to 5.6 percent. The gauge earlier this week slipped to its lowest level since September.
A spokesman for Prada in Milan declined to comment yesterday. A call to Jefferies’ Hong Kong office outside of normal business hours wasn’t answered and a spokeswoman in London wasn’t immediately available to comment.
“The fact that Prada got the deal done is positive. It wouldn’t be able to do it in Europe,” said Schuster. “It’s still a sensible move for them.”
To contact the reporter on this story: Zijing Wu in London at zwu17@bloomberg.net Alexis Xydias in London at axydias@bloomberg.net.
To contact the editor responsible for this story: Jeff St.Onge at jstonge@bloomberg.net; Andrew Rummer at arummer@bloomberg.net
Prada Debut May Mirror Samsonite, Stock Drops in Gray Market
Chris Ratcliffe/Bloomberg
A Prada SpA sign hangs above the company's boutique on Old Bond Street in London.
A Prada SpA sign hangs above the company's boutique on Old Bond Street in London. Photographer: Chris Ratcliffe/Bloomberg
June 16 (Bloomberg) -- Tim Parker, chairman and chief executive officer of Samsonite International SA, the world’s largest branded-luggage maker, talks about the company's initial public offering in Hong Kong and his business strategy. Samsonite slumped on its first day of trading as China’s monetary tightening and rival share sales sapped investor demand. Parker speaks with Susan Li and Rishaad Salamat on Bloomberg Television's "Asia Edge." (Source: Bloomberg)
June 17 (Bloomberg) -- Brian Sozzi, a retail analyst at Wall Street Strategies, talks about Prada SpA's initial public offering in Hong Kong. Prada and its owners raised about HK$16.7 billion ($2.14 billion) in this year’s biggest Hong Kong IPO after the Milan-based luxury company sold shares near the low end of its target. Sozzi speaks with Deirdre Bolton on Bloomberg Television's "InsideTrack." (Source: Bloomberg)
June 16 (Bloomberg) -- Robert Howe, chief executive officer of Hong Kong-based hedge fund Geomatrix (H.K.) Ltd., talks about initial public offerings in Hong Kong including Samsonite International SA and Prada SpA. Samsonite, after raising $1.25 billion in an initial public offering, dropped in its Hong Kong trading debut amid concern that China’s tighter monetary policy will sap demand for branded goods. Howe speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Howe started speaking before Samsonite began trading in Hong Kong. Source: Bloomberg)
Rate this Page
Bloomberg moderates all comments. Comments that are abusive or off-topic will not be posted to the site. Excessively long comments may be moderated as well. Bloomberg cannot facilitate requests to remove comments or explain individual moderation decisions.