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    Morgan Stanley has acquired a 10.6% stake in Sparkle Roll, a Chinese company that sells luxury brands like Bentley, Rolls Royce, and Lamborghini cars as well as other high-end products. Morgan Stanley paid $42 million for the stake, valuing Sparkle Roll's total market capitalization at $380 million. The investment aims to capitalize on China's booming luxury market, as the country is projected to become the world's largest luxury goods market within five years. However, Sparkle Roll currently only has a strong presence in Beijing and lacks a nationwide distribution network to fully tap into China's growing affluent consumer base across the country.

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    Morgan Stanley has acquired a 10.6% stake in Sparkle Roll, a Chinese company that sells luxury brands like Bentley, Rolls Royce, and Lamborghini cars as well as other high-end products. Morgan Stanley paid $42 million for the stake, valuing Sparkle Roll's total market capitalization at $380 million. The investment aims to capitalize on China's booming luxury market, as the country is projected to become the world's largest luxury goods market within five years. However, Sparkle Roll currently only has a strong presence in Beijing and lacks a nationwide distribution network to fully tap into China's growing affluent consumer base across the country.

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    Download as PDF, TXT or read online from Scribd
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    72 views3 pages

    Morgan Stanley China

    Uploaded by

    mahmut123
    Morgan Stanley has acquired a 10.6% stake in Sparkle Roll, a Chinese company that sells luxury brands like Bentley, Rolls Royce, and Lamborghini cars as well as other high-end products. Morgan Stanley paid $42 million for the stake, valuing Sparkle Roll's total market capitalization at $380 million. The investment aims to capitalize on China's booming luxury market, as the country is projected to become the world's largest luxury goods market within five years. However, Sparkle Roll currently only has a strong presence in Beijing and lacks a nationwide distribution network to fully tap into China's growing affluent consumer base across the country.

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    Deal of the day: Morgan Stanley buys into China s luxury market | beyond

    Deal of the day: Morgan Stanley buys into China s luxury market
    September 27, 2010 3:04 pm b be ondbrics

    B Patricia de Leon of mergermarket Morgan Stanley has found a new way to tap into China s nouveaux riches. The bank s private equity arm has bought a $42m stake in Sparkle Roll, which sells luxury brands including Bentley, Rolls Royce and Lamborghini cars, Boucheron jewelry and Duclot wines. News of the move sent Sparkle Roll s Hong Kong shares up 10 per cent on Monday; they have now gained 183 per cent in the last twelve months. And investors confidence is reflected in the company s glittering operating margin. The acquisition has been made through MSPEA Luxury Holding, which is controlled by Morgan Stanley Private Equity Asia III, L.P, a fund which channels money from institutional and private investors. The fund was set up in 2007, pledging a fiveyear investment period followed by a five-year harvest period. It paid $42m for a 10.6 per cent stake in Sparkle Roll. The company s total market cap is HKD 2.95bn ($380m), putting the price at a 4 per cent premium. The investment looks wise, given the growth in luxury consumption in China. The country is set to be the world s top luxury market in five years growing to $14.6bn from $9.4bn last year, according to a recent report by the Chinese Academy of Social Sciences. Macquarie Securities analyst Jake Lynch says:

    The fact that [Sparkle Roll] is so geared to the ultra high-end makes it a ver high bet. There is not another pure e posure [to this lu ur segment].

    High-end property developer, FPG Land, is a distant second in terms of tapping China s rich list, Lynch adds. In operating margins, Sparkle Roll is also well positioned. Its margin in 10.3 per cent, almost double that of other mainland Chinese distributorships like Zhongsheng and Dah Chong Hong. Sparkle Roll s watch-making business has margins of 40 per cent, according to Macquarie.
    ft.com//deal-of-the-day-morgan-stanley-buys-into-chinas-luxury-market/ 1/3

    02.01.12

    Deal of the day: Morgan Stanley buys into China s luxury market | beyond

    However, while strong in Beijing, Sparkle Roll lacks a nationwide network. As affluence spreads across mainland China, can Sparkle Roll follow the trend? Rela ed reading: Consumer special: He Bric Spender, be ondbrics
    Tags: consumption, M&A, mergermarket Posted in China, Czech Republic, Europe, Thailand Permalink

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