Samsonite Plans Dividends, to Enter New Segments: CEO
Samsonite shares dropped as much as 10 percent on their debut in the Hong Kong on Thursday as investor appetite for new listings waned. But CEO Timothy Parker said he believed the territory is a great market, and hoped to be able to pay dividends to the company's new shareholders.
"[The listing] brings us close to where I think the center of gravity will lie in the future," Parker told CNBC. "As a company that generates good cash flows, I'm anticipating that we will be paying dividends here in Hong Kong and so make ourselves an attractive investment."
Watch the full interview here.
Parker noted that private equity firm CVC Capital Partners, which acquired the luggage maker for $2 billion in 2007, will reduce its shareholding in the company by 40 to 50 percent after the IPO.
The CEO also said that while the company's main products were its suitcases, he saw an opportunity in expanding into business and casual bags.
"[We have] a fantastically growing business in China, in India and most of the growth countries in Asia, and we will be seeking to get advantage from those very exciting markets," he added.
Samsonite faces plenty of competition from copycat brands and non-branded suitcases, many of which are made in China and sold for a fraction of the cost. But Parker defended the company's position, saying it had a very strong brand and its sales were six times larger than that of the next biggest brand.
"Our brand rests on a degree of expertise with the product,” he said. “When people buy luggage it's important, I think, [that] it doesn't let them down at the airport or wherever they're taking it; so when people buy Samsonite, they buy quality, they buy durability, they buy lightness."