Translated by Andrew Vanburen from a Chinese-language piece in Sinafinance
LEICA CAMERA AG, which will next year celebrate its 100th anniversary, is looking to break into the Asian market even further via a possible listing in Hong Kong.
Already selling shares in both Hamburg and New York, the iconic German firm is eyeing a potential third listing to expand its capital-raising umbrella.
“Hong Kong would be our first choice for a third IPO,” Leica CEO Alfred Schopf was cited by media reports as saying.
Having not long ago embraced the digital age in order to complement its traditional line of film cameras, the firm is now engaged in an inevitable march Eastward in search of new markets and investors.
While enjoying nearly universal brand recognition in its home market of Germany, the consumer technology firm will strive over the next three to five years to make a “Great Leap Forward” in terms of establishing a more global-scale brand recognition.
“Choosing to list in Hong Kong is based on this,” Schopf said.
He added that the key to the campaign and the ultimate prize was expanding into the Mainland Chinese market.
According to a recent report in the Hong Kong financial media, in October of last year two private equity firms – Blackstone and ACM – purchased a combined 44% stake in the German camera firm.
Reportedly, another major shareholder consolidated a further 2.5% stake in the hopes of taking the company private along with the PE firms.
“Over the next three to five years, our primary objective is to help make Leica bigger and stronger. But at this point no one knows exactly how we will make that happen. Will we list in Hong Kong? That is certainly one viable option for us,” Schopf added.
He said that despite slower sales in Mainland China of late, the world’s most populous country remained the market with the greatest growth potential for Leica worldwide.
Leica has a current market capitalization of around 538 million euro (around 5.25 billion hkd), with its most recently reported 12-month net profit coming in at 35.5 million euro (350 million hkd).
Schopf conceded that during the company’s 2013 financial quarter (April to June), the company’s sales in the PRC on a year-on-year basis showed an obvious slowdown.
But he said that despite the previous two consecutive quarters showing such a tapering off in terms of sales in Mainland China, he was confident that with an expected turnaround in the PRC economy later this year that revenue would pick up once again.
“We can’t ignore the fact that China will be our biggest growth area for the foreseeable future, and we are confident that sales will reaccelerate there this year. But they will struggle to match last year’s relatively strong sales.”
Leica opened its first PRC-based shop in Beijing in 2010.
Already, there are 18 such shops sprinkled across Mainland China.
In the previous financial year, Leica’s sales in the PRC rose some 40%, which has a lot to do with the company’s interest in a possible Hong Kong listing.
Schopf plans to visit Shenzhen this summer when the German firm opens a new shop in the southern economic powerhouse.
See also:
BAD APPLES: Hong Kong’s Listing Laggards
HK SHARES: Trash Already Tossed To Curb
In Praise Of China’s Retail Investors
Whither China Shares?