Esprit's Ex-Chairman Ying Raises $160 Million in Share Sale
Great View International Ltd., a company controlled by Ying, sold 22.8 million shares, or a 1.79 percent stake, at HK$54.25 each on March 11, according to the sale document, which was sent by e-mail. The sale was arranged by UBS AG. Ying, who is a billionaire, was Esprit’s chairman from 1993 to 2006.
The shares were sold at a discount of 6.7 percent to the market price, according to the pricing sheet.
“Michael Ying has been steadily selling down his stake for the past few years and his timing of his exit can be said to be fortuitous,” Matthew Marsden, a Hong Kong-based analyst at Samsung Securities Co. said in a phone interview today.
The stock has fallen 22.4 percent since Ying sold his stake on March 11, compared with a 7.8 percent decline in the benchmark Hang Seng Index. Esprit fell 5 percent to close at HK$45.10 in Hong Kong.
The sale came a month before Esprit reported a 1.8 percent decline in fiscal nine-month sales as households in Europe, where it makes 84 percent of revenue, curbed spending.
Concerns Europe’s debt crisis will worsen also sent the euro to its weakest level against the U.S. dollar in more than four years.
“Esprit has been hit by a straightforward currency translation effect, it earns in euro and report profits in Hong Kong dollars,” Marsden said. “The hope for the stock is the euro stabilizes, and Esprit’s fundamental business is improving.”
The euro stood at $1.2178 as of 5:01 p.m. Hong Kong time, and traded at HK$9.5023. The euro has weakened by about 15 percent against the Hong Kong dollar this year.
Ying is Hong Kong’s 13th richest man with a net worth of $2.5 billion, Forbes Asia Magazine said in February.
In February he cut his stake in Esprit to 1.79 percent, compared with 30 percent in 2004, according to Bloomberg calculations using Hong Kong stock exchange data.
“Mr. Ying is neither a director nor is he subject to disclosure rules in Hong Kong as his holding is below the 5 percent limit,” Lau said in an e-mail reply to questions.