Photo: Antony Dickson/AFP/Getty Images After a month of wining, dining, and putting on elaborate fashion shows for potential investors around the world, Prada announced their stock price in Hong Kong today: it'll be 39.50 Hong Kong dollars, or $5.06 per share. The company's IPO plans apparently suffered from a number of adverse factors, mainly that it's been a crappy week for the Hong Kong market. There has also been a lack of retail demand because of the high taxes involved: Hong Kong residents purchasing shares of Prada, or any other Italian company, are required to pay a 27 percent dividend tax as well as 12.5 per cent capital gains tax on any shares they sell in the future.
Prada will reportedly raise $2.14 billion from the IPO deal, which is much lower than last week's estimate of $2.6 billion. Hong Kong market researcher Castor Pang said that Prada overestimated its worth from the start. "Even the power of international branding cannot make the deal attractive and give it a higher valuation," he told WWD, noting that Prada's valuation is still higher than many other luxury companies, including LVMH. He predicts that the listing will fall even further on its first day of trade next Thursday, June 23.
Prada Said to Raise $2.14 Billion in Hong Kong IPO [WWD]
Earlier: Prada’s International Road Show Is Going Particularly Well
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