Financial News
Written by: Lin Leqian
2020-08-07 11:56
Last update date: 2020-08-07 11:56Earlier, it was reported that City'super, a Japanese supermarket, might change hands to a Chinese consortium. According to a "Bloomberg" report, according to an email statement, CR Capital, an investment company under China Resources, and a private equity fund completed the acquisition of 65% of the Japanese supermarket, but did not disclose the transaction amount.
Inquiries have been made to CR Capital and Wheelock on the transaction "Hong Kong 01", but no reply was received. As for the Japanese company Fenix Group (Sanhuang Group), which currently holds about 60% of City'super, its CEO Jiang Bingsu said in an interview with "Hong Kong 01" that the progress of the transaction "should be about the same," but since the confidentiality agreement has been signed Order, failed to disclose relevant details.
The third wave of the local epidemic broke out. When asked whether City'super was affected by the situation recently, he said that the business volume was "good enough." Sales in July were similar to the first half of the year. Supermarket business has always been relatively stable, but it has little impact on LOG-ON business. . Sanhuang Group also has clothing brands such as Anteprima, ATSURO TAYAMA, etc. He said the epidemic has hit the clothing business harder.
China Resources led a consortium to acquire 65% of City'super. (Photo of company)
Statement expected to complete the transaction in the fourth quarter of this year
Fenix Group currently holds approximately 60% of City'super and the remaining approximately 39% is held by Wheelock shareholder Wu Guangzheng. The statement pointed out that the transaction must be approved by the Chinese regulatory authorities and is expected to be completed in the fourth quarter of this year. City'super CEO Wu Jiahua will continue to serve.
Earlier, "Bloomberg" reported that the transaction price is equivalent to 300 million US dollars (about 2.34 billion Hong Kong dollars). CR Capital, an investment company under China Resources, will acquire about 40% of the shares of City'super, and the Feng Group, a subsidiary of China Resources Group and Feng Guojing Brothers The formed joint venture company will purchase 25% of the equity.
Has 20 branches in Hong Kong
Earlier reports indicated that Fenix Group had planned to hold the first round of bidding at the end of March or early April this year. However, due to the new crown pneumonia epidemic, it may be postponed, and travel restrictions made it almost impossible for bidders to conduct on-site inspections in China.
According to data, City Super Group was established in 1996. The first city'super store was opened in the tourist area of Causeway Bay, becoming the first "large lifestyle store" in Hong Kong. According to the official website, the group currently has 3 major brands, including local Japanese supermarket city'super, LOG-ON and cookedDeli. It currently has 20 stores in Hong Kong, 6 stores in Shanghai and 7 branches in Taiwan.
Recently, a number of Hong Kong-owned retail brands have changed hands to Chinese-funded consortia, including Bossini sold to Viva China and Luodingbang descendants. (Profile picture)
Analysis: Expect more mergers and acquisitions in the retail industry in the future
CMB's consumer industry analyst Hu Yongkuang believes that supermarkets have meager profits, but they can drive the flow of people in shopping malls. Supermarket business is relatively good under the epidemic. He does not believe that the original major shareholders are selling their shares because they are down on supermarket business. As for the recent purchases of a number of retail brands by Chinese investors, he said that when the economy adjusts, the market will undergo mergers and acquisitions. Merchants that do not manage well will want to dispose of their businesses. Due to economic fluctuations, the asking prices will also vary. Discounts and low prices naturally attract multiple consortia to negotiate purchases.
The local retail market continues to be sluggish. Recently, a number of Hong Kong-owned retail brands have changed hands to Chinese consortia, including Bossini (0592) sold to Viva China (08032) and Luodingbang’s descendants controlled by the Li Ning family, and established department stores. Shi (00244) was taken over by the real estate stock Realord Group. The sale of City'super to China Resources means that more brands will be included in the hands of Chinese investors. Hu expects that if the economy continues to deteriorate, there may be more acquisitions in the retail industry.
"Bloomberg": City'super received a consortium led by China Resources Group to spend more than 2.3 billion yuan to purchase 65% of the shares
City'super’s proposed sale is rumored to be bid by local Da Masha, China Resources and Yonghui Supermarkets
China Resources Group Wheelock