HONG KONG (Reuters) ? For tycoon Cheng Yu-Tung, 86, listing his jewelry retailer Chow Tai Fook, the world's largest, on the Hong Kong Stock Exchange paves the way for his younger generation to strengthen its position in China's glittering market.
Chow Tai Fook Jewellery Group Ltd, built by Cheng from scratch into a household name in China, debuted on Thursday with a market value of about $19 billion - more than twice that of Tiffany & Co - after raising $2 billion from Hong Kong's third largest IPO this year.
The stock lost some of its sparkle, however, sliding as much as 9 percent - a victim of weak sentiment on global financial markets.
That market uncertainty has prompted several other companies to cancel Hong Kong IPOs, but Chow Tai Fook seized a tiny window of opportunity to launch its IPO and raise the money it badly needs for future expansion.
The decision to go ahead with the listing underscores Cheng's anxiety to cash in on China's booming jewelry market where demand from a burgeoning middle class is driving fiercer competition from Tiffany and Cartier as well as local rivals Chow Sang Sang and Luk Fook.
"We have no intention, at least for 10 years, to open any POS (points of sale) other than in China, Hong Kong and Macau," his son Henry Cheng, chairman of Chow Tai Fook, said earlier this month.
Chow Tai Fook - which means 'good luck' in Cantonese - will use the IPO proceeds to buy gold and diamonds and expand its jewelry store network.
While Chow Tai Fook is mainly run by Henry and his grandson Adrian, a Harvard graduate and ex-Goldman Sachs banker, analysts say Cheng Yu-Tung remains the lynchpin and, as honorary chairman of the 82 year-old firm, holds sway on the big decisions.
"We see this listing as one of the steps of handing over because he (Cheng) wants the business to stay successful," said Eugene Mak, analyst at Core Pacific Yamaichi International. "One of the best ways to do that is to go public. This is a good thing for the business in the long run."
BUSINESS EMPIRE
Cheng Yu-Tung, also chairman of one of Hong Kong's biggest property groups, New World Development, has businesses spanning real estate and jewelry to infrastructure, hotels and telecommunications around the world.
The spry octogenarian is one of Hong Kong's richest men with a fortune estimated at $9 billion by Forbes.
Chow Tai Fook, founded by Cheng's father-in-law Chow Chi-yuen in 1929, opened its first outlet in Beijing in 1998. It now has some 1,500 stores, most of them in China's 260 cities, and aims to expand that to 2,000 stores by 2016.
Characterized by its burgundy colored logo, Chow Tai Fook stores dominate shopping districts in Hong Kong with some stores within a short walking distance from each other. Advertisements are plastered across double-decker buses and subway stations, dwarfing those of rivals.
A golfer and known for his down-to-earth personality, Cheng is often seen dressed in sports shoes walking around Chow Tai Fook stores in downtown Hong Kong, mingling with staff and customers.
Soft spoken and friendly in person, Cheng, with his cropped dark hair and signature mole to the right of his mouth, looks more like an elderly Chinese uncle than a high-powered billionaire.
POKER AND FAMILY
Cheng also enjoys playing poker with good friends who include real estate mogul Lee Shau Kee, chairman of Henderson Land, say people close to him. His circle of friends also includes former Macau kingpin Stanley Ho, and Cheng remains a non-executive director of Ho's gaming conglomerate SJM, they say.
Having started as a trainee with Chow Tai Fook in 1947, Cheng is known to love home cooked Cantonese food, favoring fish and soup.
Also one of Hong Kong's leading philanthropists, Cheng is attached to his hometown of Shunde in southern China's Pearl River Delta, say colleagues, and has set up production facilities there for his business.
A father of four, Cheng is married to Chow Tsui Ying, whose father started Chow Tai Fook's first gold shop.
"There are a lot of people named Cheng working for him. Even if they are not blood relatives, they are people who come from his hometown area," said a contact close to Cheng.
(Editing by Charlie Zhu and Ian Geoghegan)
remember the titans wale wale weather denver weather denver ambition dorothy rodham
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.