Friday, 8 October 2010

Prada contemplating a Hong Kong IPO? We Thought So... 8/9/10

Prada has been expected to make an IPO for a while now- On September 20 we commented on the brand’s strong performance recently, and suggested on top of more rumours that now is perhaps as good an opportunity as ever. It seems we were correct. Market conditions allowing, Prada is contemplating a Hong Kong flotation for 2011, in time to take advantage of the expansion of the Chinese market- already the fastest growing, and soon to be the world’s largest market for luxury brands. This is the most likely move, but Prada have not decided just yet.

Prada have flirted with the idea of making an IPO for years, but each attempt has been thwarted- they just haven’t seemed to have great luck with timing. If they do list, it will be fourth time lucky following three failed attempts in the past ten years. Perhaps fourth time very lucky, and well worth the wait. If they can time the offer in line with Chinese growth, as well as economic recovery in the US and Europe, Prada might also be able to shake off its debt (estimated at approx $1.4 billion AUD) and emerge positively laughing. All in all, Prada is expected to be valued between 4.5-6.7 billion euros ($6.4-9.6 billion AUD).

Still, nothing is set in concrete, and the move will involve significant changes to Prada’s executive and supervisory structure. Decision-making currently lies very much in the hands of Chief Executive Patrizio Bertelli, who, with the family of Muiccia Prada, controls 95 per cent of Prada Spa’s capital. The Italian bank Intesa Sanpaolo owns the remaining 5 per cent.

We can’t wait to see what is in store for one of the world’s most iconic fashion houses, and impatiently await further revelations.

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genevieve said...

I am a Business student (Majoring in Marketing, Minor in PR) and your blog has given me a taste for how fascinating the luxury market is. Thank you for your spectacular work!


MO said...

Thank you for your feedback Genevieve and of course spread the word! We appreciate you taking the time to write to us. We wish you success in your studies and perhaps a future career in the luxury industry.

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Melinda O’Rourke is the founder and Director of MO Luxury, a dynamic, Sydney-based management firm specialising in luxury brands and services. Melinda and her associates at MO work with local and international brands across prestige retail, fashion, fine jewellery, timepieces and specialised services. Melinda is well-connected, well-read, and well-versed in the demands of the luxury market and its client base. Her advice is firmly based in objectivity and ultimately, accountability. Melinda offers constructive counsel and both strategic and creative thinking and is able to draw upon a strong network of specialised talent to compliment the MO Luxury team as needed. Melinda enjoys excellent industry relationships and is regularly quoted in the business and fashion media. Read more about MO Luxury,