Hong Kong secondary listing is first stop in Fast Retailing's growth plan

Secondary listing is part of Japanese fashion chain's bid to boost brand awareness in Asia

PUBLISHED : Tuesday, 28 January, 2014, 1:35am
UPDATED : Tuesday, 28 January, 2014, 1:35am

Fast Retailing, the operator of popular cheap chic fashion chain Uniqlo, plans a secondary listing on the Hong Kong stock exchange, a move it says demonstrates the firm's commitment to the Asia region.

The planned March 4 listing will "further improve the company's exposure to investors and customers in the rapidly growing Asian market including China", the company said in a statement.

Though no shares will be issued and no capital will be raised, the listing will allow investors to buy and sell Fast Retailing depository receipts in Hong Kong dollars rather than the yen-denominated stock.

The company, owned by Japan's richest man, Tadashi Yanai, will continue to have its primary listing on the Tokyo Stock Exchange.

Morgan Stanley is acting as the underwriter of the deal.

"As there will reportedly be no new shares issued, and no significant change in the financial statements of the company, there is unlikely to be any significant impact on the long-term earnings prospects of the company. It may, however, help raise the profile of Fast Retailing as it continues its Asian expansion," Macquarie analyst Toby Williams said.

Fast Retailing is not the first overseas brand to pursue a secondary listing in the city. Affordable luxury brand Coach and casino operator Melco Crown Entertainment listed here in 2011, also without issuing shares.

Once regulatory approval is obtained from the stock exchange, Fast Retailing will be the third Japanese company to list in the city, after SBI Holdings and Dynam Japan Holdings.

The Japanese clothing company is on an aggressive overseas expansion drive to become the region's No1 apparel brand by 2020.

The company opened 33 new Uniqlo stores across Hong Kong, the mainland and Taiwan, totalling 312 at the end of November. That included the opening of its Shanghai flagship store, the largest shop to date.

The group had earlier said it plans to add about 100 stores a year over the next decade on the mainland to increase the number of its outlets to 3,000.

Fast Retailing is currently the world's fourth-largest apparel retail company with a portfolio of seven brands.

Besides Uniqlo, it owns Helmut Lang, Theory, Comptoir des Cotonniers, Princesse tam.tam and J Brand.

For its first quarter of September to November, global sales increased 22.3 per cent year on year to 389 billion yen (HK$29.5 billion) while income was up 8.8 per cent to 41.8 billion yen.

However, a depreciating yen has helped boost the company's financials.

Shares of Fast Retailing were down 1.9 per cent yesterday, outperforming the Nikkei.