Patchi IPO in Challenging Middle Eastern Financial Climate
Patchi, the Lebanon-based chocolate company is planning to float a 49-percent stake in the family-owned company it seeks to expand globally. The primary listing is believed to be in Dubai and the secondary listing in London. Appetite for IPOs dropped substantially in 2009 as investors react to the global and regional economic crisis.
Patchi was founded in 1974 by Nizar Choucair. It now has more than 140 boutiques in some 35 countries. In addition to chocolates, Patchi makes silver tableware and artificial flowers and has printing, porcelain and glass divisions.
Mazin Obeidi, Patchi’s executive general manager, had delayed the flotation as the financial crisis hit and had planned to open 165 stores globally by the end of 2010.
Sales in key markets such as Dubai, Singapore and Hong Kong had dropped, while it shut 14 stores since September 2008 in the United States, Canada, Australia and Nigeria.
The IPO funds would finance Patchi’s expansion to 165 by end of 2010 and possibly a chain of cafes around the world. Patchi plans to open shops in Russia and Japan – the Takashimaya department store in 12 Japanese cities.
Patchi’s sales revenue in 2008 was quoted to be US$165 million.