Leica IPO: Date Set

[ATANOVIC <ATANOVIC@genre.com>]

All the following information comes off this morning's wire service bulletins, 
lifted without permission from Bloomberg, Reuters, and the Financial Times:

Leica Camera AG this morning (Sept 2) reported it will sell up to 3.5 million 
shares in its initial public offering (IPO) at an expected price of between 
DM40 to DM47 per share.  The final price will be determined Sept 12 and the 
shares will begin trading on the Frankfurt exchange Sept 19.  Union Bank of 
Switzerland and WestDeutsche Landesbank Girozentrale are acting as joint global 
managers for the sale, which is expected to raise between 140 and 165 million 
DM.  

Leica Camera's parent, Swiss-based Leica Technologie AG, which currently owns 
91% of the company, will see its stake drop to 20% after the sale, while Leica 
Camera's management team will hold 7.5%.  If the initial offering is 
well-received, an additional 450,000 shares may be put on the market, which 
would see these numbers drop to 13.5% and 7.2% respectively.  Thus, after the 
sale, between 70 and 80% of Leica will be in the hands of the public.

The new shares are eligible for a full dividend for the year ending March 31 
1997.  Analysts are estimating a payout of between DM1.00 and DM1.20 for the 
current year.  Earnings per share are forecast at about DM2.25 this year and 
DM3.00 in fiscal 1997-98.

Some background on Leica's financials and the preparations they've been making 
to put it up for sale:

* Sales in the fiscal year ending Mar 31, 1996 were 240 million DM, with 
pre-tax operating profits of 16.5m.  Cameras account for more than half this 
total.  Leica is projecting a 10% rise in both sales and profits this fiscal 
year.

* Leica is focusing on the Far East as a growth area.  Sales in Germany, 
Leica's largest market, are expected to fall from 47% of total sales currently 
to 38% by 1999.  Sales in the Far East, by comparison, have doubled to almost 
20% of group sales in the last two years, and are expected to comprise 24% by 
1999.  North American sales currently account for about 10% of the order book.

* Leica has approximately tripled spending on research and development since 
1988 and plans to use the proceeds of the share sale to expand product lines 
and enter new markets.  Over the past year, Leica has been adding additional 
production capacity; in April, they acquired the production facilities of 
Minox, the loss-making German micro-camera maker.  Leica plans to unveil 
several new camera and electronic imaging products later this month at the 
Cologne Photokina.

* The company has sought to reduce production costs by outsourcing and by 
shifting component production to Portugal.

I should add the obvious, that all the foregoing is intended for LUG's 
information only and not as an inducement to buy the shares of Leica Camera 
AG.  The value of shares when they are first introduced to the market is often 
highly volatile.  Many experienced investors never touch them.  The Frankfurt 
share symbol is 1106Z if you're interested in tracking it.

Best Regards,
Adrian Tanovic
Tokyo