Even after a discount, Prada remains a luxury
Will Prada have to sell its IPO shares at bargain basement prices? Well, maybe 'bargain basement' is too strong, but the luxury-goods maker has had to lower its earlier lofty assessment of its own worth. It was yesterday forced to lower the price of its IPO shares, reducing the maximum it could raise from the offer to US$2.3 billion from US$2.6 billion, according to Reuters.
It would be tempting to say this will be the first time you'll ever get anything on the cheap from Prada. But at these levels it still commands a significantly higher price-earnings multiple than other luxury-goods brands. Prada initially priced its shares between HK$36.50 and HK$48, putting it on a price-earnings multiple of 26 to 34 times. Yesterday it narrowed the range to HK$39.50 to HK$42.25, according to Reuters. While the new range will lower the PE it is still significantly higher than other luxury brands, which trade on a PE multiple of about 20 times. If Samsonite is anything to go by following its 11 per cent decline on its debut yesterday, punters stand a reasonable chance of getting Prada shares at a sub-IPO price after it lists.
Beauty in the eyes of the law
Singapore's legal fraternity is wrestling with a controversy that, for once, has nothing to do with politics. Should a woman be awarded less alimony if she is attractive and therefore likely to remarry earlier than someone less well-endowed with good looks?
The matter arose when a woman applied for a judicial review after alleging that a judge in a divorce settlement 'had asked whether she was attractive', The Straits Times reports. The judge hearing the review ruled that asking whether a woman was attractive 'was not irrelevant', the newspaper said.
This is a legal minefield that most jurisdictions appear to have steered clear of. Family lawyers consulted by the paper didn't think it would become a significant factor in divorce proceedings. But even if it gets some consideration, it opens the door to undignified courtroom exchanges over a woman's looks.
Beauty, as the saying goes, is in the eye of the beholder. But God forbid it should be determined by the eye of a judge.
A cloud over Hong Kong
We read more evidence that polluted air and the shortage of international school places is a growing problem for Hong Kong. Ambition, a headhunting firm specialising in the banking, finance, sales and marketing and technology sectors, says the number of Hong Kong-based candidates looking to relocate to Singapore rose 58 per cent in the first six months of the year compared with the same period last year.
'Citing a number of issues, from pollution to the size and the cost of accommodation, job candidates have indicated growing levels of disenchantment with Hong Kong as a place to work and bring up a family' the press release says.
Ambition's managing director, Matthew Hill, says: 'It's no secret that Hong Kong's air quality is a major problem, as is finding a school place, but we are seeing clear signs that what are often discussed as personal/family issues are actually key business issues.'
Earlier this month, a survey by office space-provider Regus of more than 200 international and local companies operating in Hong Kong said the city's polluted air was negatively affecting business, with three out of four saying it was making it harder for them to attract and retain employees from abroad.
The business community, organisations such as Clear the Air and Civic Exchange and a number of medical organisations and doctors have been voicing concern about Hong Kong's poisonous air, but the government has so far turned a deaf ear. The main problem is roadside pollution, which is well within its ability to clean up. But it has so far put this issue in the 'too hard basket' and done virtually nothing about it.
The dreaded Sir Fred
The Thomson Reuters Extel Awards lunch attracts the creme de la creme of the financial community, or so you would have thought. But more than 15 per cent of the 300 present, according to the Evening Standard, said Sir Fred ('Fred the Shred') Goodwin should head the IMF.
This is the man whose 'leadership' of the Royal Bank of Scotland brought it to its knees, requiring a GBP50 billion (HK$635 billion) bailout from the British government. Added to which, recent revelations over his hushed-up affair with a colleague at RBS have prompted a novel investigation by the Financial Services Authority to determine whether his sex life contributed to the collapse of the bank. As to being 'fit and proper' for the IMF, we can only conclude those at the lunch were having 'a larf'.