Samsonite International’s high valuation has put off several private equity firms including, Carlyle Group and KKR & Co, considering a buyout of the luggage manufacturer, opening up the possibility for a dual listing of the company, according to a report by Bloomberg.
Investment funds initially showed interest, but the valuation expectations of Samsonite were not met. Although the possibility of a private deal could be revisited, current plans are on hold.
Following another Bloomberg report on the decreased buyout interest, Samsonite’s shares experienced a decline with a maximum drop of 5.3%, the largest since March 2022. The company’s market value stands at approximately HK$41bn ($5.2bn), with the 12-month gain reduced to 11%.
In March, it was reported that the company, which is listed in Hong Kong and owns brands such as American Tourister, Tumi, and High Sierra, was considering a second listing to enhance liquidity and attract global investors, following an initial review of potential strategies to increase shareholder value. At the time, Bloomberg’s sources indicated that Samsonite was open to a private deal and had attracted interest from several buyout firms.
Investment funds including the Carlyle and KKRo had expressed initial interest in a potential takeover, while other firms including CVC Capital Partners and DCP Capital Partners were also contemplating a deal.
Samsonite, which went public in Hong Kong in 2011 to cater to wealthy Chinese customers, has been affected by a general decrease in consumer spending due to various factors, including economic instability, a property crisis and high youth unemployment in the country.
The underperformance of the stock market is causing companies to reassess their listings in Hong Kong. More recently, skincare company L’Occitane International has been nearing a buyout deal with Blackstone.
Over the past 12 months, Hong Kong’s Hang Seng Index has decreased by 21%, making it the worst-performing major global stock index during this period.
