Fraspens will use an initial public offering (IPO) on London’s junior stock exchange to raise £4 million and secure a valuation of around £40 million.
The business, which is based in China, is an outdoor wear brand retailer which began by producing its own products in 2007. It has since gone on to outsource manufacture and secure distributors.
The Alternative Investment Market (AIM) is set to become home for Fraspens, where it will join fellow new Chinese listings such as Jiansen and Galasys, and JQW.
John Bautista, CEO of Fraspens, says the fundraising will allow the business to capitalise on what he describes as the ‘high growth’ Chinese outdoor wear market by exploiting demand in cities and rural areas that have not before been targeted by larger domestic brands.
‘Funds raised will contribute to sustained marketing and advertising campaigns to push the business into unrepresented areas, growth the number of distributor outlets by developing the distributor network, as well as increasing R&D,’ he adds.
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According to statistics from the business, Fraspens has a 6.8 per cent share of the Chinese outdoor wear market and posted revenues of £39 million last year.
On listing, Fraspens will implement a progressive dividend policy, with an interim dividend to be announced with the results of trading for the six months to 30 June 2014.
The Fraspens management team believes that its existing business model will allow it to leverage the retail sales network and geographical reach of its distributors and sub-distributors without having to allocate resources to operate and maintain its own retail sales network.
In 2013, the brand sold 3.8 million products from 434 product lines, with the majority of products sold consisting of outdoor clothing.