Hong Kong Firm Ready To Buy Hull City Munich Has Highest Payroll In DEL Nottingham Forest Owner Seeks £1M Salary Durham Cricket To Get Rescue Package Surprise Football Results Lift Ladbrokes Hong Kong's MEF Faces Unclear Future Man City Announces £20.5M In Profit McCourt Officially Purchases OM Investors Take Over Birmingham City ManU Tops List Of Jersey Sales
Enter amount in full numerical value, without currency symbol or commas (ex: 3000000).
SBD Global/January 28, 2013/Finance
Li Ning Shares Drop Following Announcement Of $241M Fundrasing Plan
Published January 28, 2013
TAKING ITS TOLL: On the WALL STREET JOURNAL's blog Asia Business, Laurie Burkitt noted the plan "calls for three of Li Ning's major investors" -- U.S. buyout firm TPG, sports talent firm Viva China and Government of Singapore Investment Corp. -- to buy a combined total of HK$627.5M ($80.9M) in the securities. Discounts intended to clear its shelves "have taken a toll on the brand." Li Ning and TPG "plan to revive it with new products," such as lightweight running gear. Additionally, Li Ning Exec Dir & Vice Chair Jin-Goon Kim said that the company is "planning marketing and sponsorship promotions, as well as product innovations for basketball, running and badminton, which are among the most popular of its apparel lines in China" (WSJ, 1/25).
INVENTORY ISSUES: REUTERS' Donny Kwok noted shares in Li Ning, which have a market value of $846M, fell 53% on Wednesday prior to the fundraising announcement "after a Hong Kong media report said the sportswear sector still faced an inventory overhang." Its shares had risen more than 20% in January. Sunwah Kingsway Research analyst Steve Chow said, "Li Ning is a role model among the rivals and is a showcase of the industry. The latest fundraising plan suggested that players have to put in a lot more effort to deal with this tough inventory issue. That erases hope of a recovery of the sector -- at least it won't happen in the short run" (REUTERS, 1/25).