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Li Ning goes public in Hong Kong
By Liu Jie (China Daily)
Updated: 2004-06-16 10:59
China's leading enterprise in sporting and leisure footwear, apparel and
accessories launched its initial public offering (IPO) yesterday in Hong Kong.
The group, Li Ning Co Ltd, to be officially listed on June 28, expects to
raise up to HK$550 million (US$70.54 million).
The share price ranges from HK$1.76 (23 US cents) to HK$2.23 (29 US cents).
The share offer comprises an international placement and a Hong Kong public
offer, with 221,864,000 shares, which comprise 211,410,000 new shares and
10,454,000 sale shares. They will be allocated for subscription and purchased
under international placing.
The remaining 24,652,000 new shares will be allocated for subscription under
the Hong Kong public offer.
DBS Asia Capital Ltd is the global co-ordinator, and Bookrunner is the lead
manager and sponsor of the IPO.
Nearly half of the fund, or over HK$210 million (US$27 million), raised via
the IPO will be spent on brand promotion and sales network expansion, in an
attempt to maintain the company's dominant position in the Chinese mainland's
sporting goods market.
"Our top priority is to capture the full potential of our extensive
distribution and retail networks to maximize revenues and profitability," said
former Olympian Li Ning, chairman of the group, who is also referred to as
China's "Prince of Gymnastics."
As of May 31 this year, there were 2,500 Li Ning chain outlets, including
franchised stores and directly managed shops, across China. And it plans to open
another 1,000 stores by 2006.
Li Ning sporting goods are very popular in the second and third-tier cities,
given their high quality and relatively low prices compared with foreign brands
such as Nike, Adidas and Puma.
However, in the brand-conscious first-tier cities like Beijing, Guangzhou and
Shanghai, Li Ning is less competitive. Brand and marketing promotion is the
company's top concern.
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