August 11, 2008 / 7:18 AM / 9 years ago

Olympics-Chinese gymnast's wealth soars with opening ceremony

4 IN. DI LETTURA

HONG KONG, Aug 11 (Reuters) - Former Chinese gymnast Li Ning was $30 million richer on Monday when shares in his company soared thanks to a starring role at the Olympics opening ceremony, when he was hoisted by cables to light a cauldron.

Investors snapped up shares in his Hong Kong-listed sportswear firm, Li Ning Co. Ltd (2331.HK), hoping that global recognition would follow Friday's spectacle.

Audiences around the world gave rave reviews to the extravaganza of thundering drums and exploding firecrackers, which ended with a heart-stopping climax when Li simulated a race in mid air to set the giant Olympic cauldron ablaze.

Although the impact on sales of Li Ning's clothing line may be hard to gauge, shares in the firm shot up 5 percent on Monday morning to HK$18.50.

Li controlled 266.8 million shares of the firm as of July 11, including through a company jointly owned by his brother, according to Thomson Reuters data.

The paper gain of $30 million for the former gymnast who won six medals at the 1984 Los Angeles Olympics, follows a 3.7 percent share price rally on Friday as rumours swirled that he would feature in the opening ceremony.

The stock is down 34 percent this year, in line with falling stock markets, after more than doubling in 2007.

"I think it actually has more to do with hype," said Germaine Khong, a Hong Kong-based analyst at brokers CIMB. "There's a risk of over-expansion in the Chinese sportswear market, but Li Ning is the short-term beneficiary of the Olympics."

Li Ning, which says it wants to be one of the world's top five sports brands by 2018, is supplying sportswear for the Olympic teams from China, Spain and Sweden.

The brand's logo is similar to the Nike swoosh, although the company says it represents Li Ning's initials and his dynamism on gymnastics apparatus. Li Ning's motto of "anything is possible" also echoes Adidas' ADSG.DE "impossible is nothing" slogan.

Li Ning was accused of ambush marketing when, despite not having paid to sponsor the Beijing Games, the firm struck a deal that resulted in staff on state broadcaster CCTV wearing the company's logo during Olympic broadcasts.

The International Olympic Committee, spurred by complaints from rival firms, investigated Li Ning's arrangements but found no violation of its rules.

With a 10.5 percent share of China's sportswear market, Li Ning is keen to catch up to Adidas's 15.6 percent and Nike's (NKE.N) 16.7 percent, and a dose of national pride could help.

Chinese media acclaimed the ceremony as a moment when national achievements and ambitions won acceptance on a world stage, putting aside rancour over controversies such as China's policy towards Sudan and its crackdown on rioting in Tibet.

"This great performance was a brilliant distillation of 5,000 years of glorious history," a commentary on the website of the People's Daily said. "China will embrace the world with openness, self-confidence and warmth."

Through his achievements in sport and business, Li represents the strength of China's Soviet-style sports system as well as the entrepreneurship and wealth of the country's new capitalism.

The 44-year-old won the most medals of any athlete at the 1984 Los Angeles Olympics, returning home from China's first participation in a Summer Games for 32 years with three golds, two silvers and a bronze.

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