dickson shareholders may wonder who benefits most from latest deal
The Dickson Concepts recipe for success in business is, as his stock watchers will tell you, a time-honoured one - buy low and sell high between the listed company and the parent company.
However, retail tycoon Dickson Poon's listed company Dickson Concepts yesterday proposed to buy the Asian licensing business of Tommy Hilfiger from the chairman for $396 million or about 7.8 times last year's earnings.
The price represents 6.6 times its book value this year and 12 times that of last year's and altogether seems a bit rich for a flat business.
What is rather curious is that Mr Poon did not give a profits guarantee this year. The group did not even release sales figure of its Tommy Hilfiger Asian business which runs 79 stores in Hong Kong, Taiwan, China, Singapore and Malaysia.
We are not sure if this is a good deal for Dickson shareholders, given Tommy Hilfiger was taken over by private equity group Apex Partners only three months ago for US$1.6 billion and that the US apparel brand is destined for a painful restructuring.
