China's Xtep Goes Public

Xtep International Holdings Ltd., a Chinese maker of fashion sportswear, has raised HK$2.23 billion (US $286m) in an IPO on the Hong Kong Exchange. Company shareholders include The Carlyle Group.

 

PRESS RELEASE

 

Xtep International Holdings Limited (Xtep, SEHK Stock Code: 1368), one of the largest fashion sportswear companies in China, has debuted today on the Main Board of the Stock Exchange of Hong Kong, raising HK$2.23 billion (approximately US$286 million) of new capital.

Xtep began operations in 1999 as a manufacturer for major international sportswear brands. Last year, Xtep's namesake brand was one of the largest brands in China's domestic fashion sportswear sector with a 3.4 percent share of the athletic shoes and clothing market. Xtep also markets products under its Koling brand and distributes Disney Sports products in China.

Xtep offered a total of 550 million primary shares to international and Hong Kong investors. Both the institutional and retail tranches have been fully subscribed, showing a strong confidence in Xtep's ability to capture the increased demand for sporting goods in the lead up to the Beijing Olympics.

The proceeds of IPO will be used to broaden Xtep's distribution network, support sales and marketing initiatives, make acquisitions, as well as provide working capital for expanded apparel production facilities.

Mr. Ding Shui Po, Chairman of Xtep will remain the controlling shareholders while Carlyle will continue to be a committed strategic investor. Xtep is a portfolio company of Carlyle Asia Growth Partners III under the Carlyle Asia Growth Capital Group which manages three funds with a total asset value of US$1 billion.

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About Xtep International Holdings Limited

Xtep is one of the largest fashion sportswear companies in China which designs, develops, manufactures and markets sporting goods including footwear, apparel and accessories under proprietary brands Xtep and Koling as well as under a licensed brand Disney Sports across the country. Founded in 1999 and headquartered in Quanzhou of the Fujian province, Xtep began as an OEM sports footwear manufacturer for major international brands. With the broad recognition of its product quality, Xtep created its namesake brand in 2002 and marketed its products in China. One of its product series, Windfire series, became one of the best selling sports footwear collections in China. The company's dedication to quality enabled it to be selected as the sole sports product partner for the 10th National Games of China in 2005 and be named as among China's 500 Most Valuable Brands by the World Brand Laboratory in 2006. In 2007, Xtep was named as China's No. 1 sporting goods brand by World Brand Laboratory. Xtep has 6,188 employees in China.