Ferretti float may be back in same boat

Ferretti float may be back in same boat

(The authors are Reuters Breakingviews columnists. The opinions expressed are their own. Refiles to remove extraneous advisory.)

MELBOURNE - Ferretti may find Victoria Harbour just as challenging to navigate as Lake Como. Roughly two years after aborting an initial public offering effort in Milan, the Italian yacht maker is trying again in Hong Kong. It will be equally difficult to make a splash.

Best known for its Riva speedboats favoured by Hollywood stars and the ultra-rich, Ferretti has been docked for a decade at a Chinese state-owned enterprise whose product lines include spark plugs and bus engines. Weichai Group and Shandong Heavy Industry bought control of the embattled company from creditors in 2012. Its last attempt at a market debut flopped when a 1.1 billion euros valuation target, roughly $1.2 billion, proved too ambitious.

Although the initial strategy to grow sales in China and nearby has not gone to plan, demand elsewhere is rebounding. Annual revenue in Asia-Pacific fell from 2018 to 2020, and the region accounted for just 5% of the total in the nine months to Sept. 30, about half the proportion from a year earlier. And yet the company’s top line swelled by 63% over the same span, to nearly