CVC Capital Partners-backed luggage maker Samsonite International has priced its Hong Kong initial public offering at HK$14.5 per share, valuing the company at $1.25 billion, according to a Reuters report.
Just two weeks ago, Samsonite set the indicative price range of its offering at HK$13.5 to HK$17.5 per share, before scaling back to HK$14.5 to HK$15.5 each yesterday. A price at the top would have valued the company at $1.5 billion.
“Market sentiment has turned recently and some of the recent IPOs haven't performed well. As a result companies are forced to lower price to factor in the weak demand,” Steven Leung, sales director with UOB Kay Hian Holdings, was quoted as saying in the report.
CVC bought Samsonite for $1.7 billion at the height of the credit bubble in June 2008. The following year, the firm had to inject $175 million to retain its control of Samsonite, reducing the company’s debt burden from around $800 million to $240 million. CVC is reportedly selling less than half of its stake in the business, with 47.7 percent of Samsonite likely to be sold in the offering.
CVC acquired Samsonite in a take-private transaction, which represented an exit for the business’ largest shareholders – Ares Management, Bain Capital, and Teachers’ Private Capital, the private investment arm of Ontario Teachers’ Pension Plan. The exit reportedly netted the consortium more than five times their money invested.