Fast Retailing to list in HK in bid to be No. 1 apparel firm by 2020
Print Edition
Japan’s Fast Retailing Co will list in Hong Kong as the operator of the Uniqlo casual clothing chain seeks to raise its Asian profile en route to becoming the world’s top apparel retailer by 2020.
Fast Retailing is focusing on Asia to help it quintuple revenue to US$50 billion, overtaking Zara operator Inditex SA, Hennes & Mauritz AB and Gap Inc.
Asia’s biggest clothing retailer by market value said yesterday that it will list in Hong Kong on March 5 to boost its profile, demonstrate commitment to the region and make its stock available to a wider pool of investors.
The company said it plans to list Hong Kong Depositary Receipts — which will allow investors to buy its Tokyo-listed shares through the Hong Kong stock exchange — rather than by selling shares to raise funds.
“We chose Hong Kong among the many bourses out there because Hong Kong is the center of financial markets in Asia,” Chief Financial Officer Takeshi Okazaki said at a Tokyo news conference.
“By increasing brand awareness further, we’re aiming to accelerate our overall expansion.”
Offering shares through other overseas exchanges is a possibility as a strategy for raising the company’s profile, Okazaki said.
Morgan Stanley is sponsoring the Hong Kong listing, which is pending approval from the bourse.
Listing in Hong Kong for branding purposes has been popular among companies as they appeal to investors and consumers in the city and the rest of China.
Two companies have already taken that road in January, compared with five for all of 2013 and just two in 2012.
Those listing without selling shares in the past few years include US-based luxury group Coach Inc and casino operator Melco Crown Entertainment Ltd.
Such listings, known as listing by introduction, have had limited success unlike typical initial public offerings because there are no new shares to trade. Coach’s depositary receipts were not traded over three straight days last week.
Companies and investment bankers have said listing by introduction could be a platform to raise capital in the future, but since 2010, only three of 24 firms have raised funds after introductions.
Fast Retailing, which has built up cash reserves in recent years thanks to growing sales, said its Hong Kong listing was not aimed at raising funds.
Uniqlo has 251 outlets in China.
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