LONDON (ShareCast) - Analysts at CMC Markets have suggested the £1.1bn initial public offer (IPO) of fashionable shoemaker Jimmy Choo could be shelved, after challenger bank Aldermore pulled its Friday flotation.
CMC Markets' Michael Hewson said that, given the "raspberry" blown in the direction of fashion peers Burberry and Mulberry this week and other recent IPO withdrawals in Europe, Jimmy Choo was floating at a difficult time, with widespread concern in the market about growth and valuations.

"It is in this environment that Jimmy Choo will be stepping into the spotlight, looking to raise up to £175m, with a potential market capitalisation of £620m or $1bn."

He added: "With a typical pair of shoes costing northwards of £300 the timing of the IPO could have been better, but with the shares fully allotted it would take a significant change of heart for the float to get pulled at this late stage."

The biggest concern surrounding the Jimmy Choo flotation, Hewson suggested, is that the company is not raising much cash for the business.

The company has about £100m in debt and intends to increase the number of shops in China from 11 to about 30 over the next few years.

"It is hard to see how they can do that at a time when most luxury brands are reporting slowing growth while Chinese retail sales growth has been slowing significantly in the past two years," Hewson said.

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