People familiar with the matter revealed that Amer Sports' dependence on the Chinese market is affecting the interest of investors considering participating in this IPO.
The Zhitong Finance App learned that Amer Sports, the parent company of clothes/sports brands such as Archeongbird, Salomon, and Wilson, submitted an initial public offering (IPO) application to the US Securities and Exchange Commission (SEC) earlier this month to raise up to 1.8 billion US dollars. The company plans to be listed on the New York Stock Exchange under the ticker symbol “AS.” However, sources familiar with the matter revealed that Amer Sports' dependence on the Chinese market is affecting the interest of investors considering participating in this IPO.
According to Amer Sports' IPO prospectus, in the first nine months of 2023, the company's sales in the Chinese market accounted for 19.4% of its total sales, up from 8.3% in 2020. Although the majority of the company's sales come from America and Europe, and sales in these regions have been growing, the company's sales in China are growing much faster. According to the IPO prospectus, in the first nine months of 2023, Amer Sports' sales in the Chinese market were US$593 million, an increase of 68% over the same period last year.
Additionally, Amer Sports warned in its IPO prospectus that escalating trade tensions could in the future limit the company's ability to sell goods manufactured or purchased in China in the US by tariffs or other factors. Amer Sports stated in its IPO prospectus that the main suppliers and manufacturing facilities are currently located in China.
According to reports, Amer Sports is a non-wholly-owned subsidiary of Anta Sports Joint Venture Amer Sports Holding (Cayman) Limited (AS Holding for short). Anta Sports and the Investor Consortium completed the acquisition of Amer Sports in 2019. As of the end of 2022, Anta Sports actually held 52.7% of AS Holding's equity.
People familiar with the matter said that although Amer Sports' IPI has been oversubscribed and the offering is not at risk, weakening investor demand may prompt the company to act prudently and set the issue price at the bottom or middle of the indicative range of $16-18 per share. People familiar with the matter added that the company has yet to make a decision, but even if the IPO price is at the bottom of this range, the company's valuation will reach around $8 billion.
According to reports, Amer Sports' current IPO is scheduled to be priced on Wednesday night EST and listed on the New York Stock Exchange on Thursday.