Sanlian Group to Establish New Retail Subsidiary
Xinhuanet, 2/05/09
A spokesperson for the Sanlian Group has revealed that the company plans to establish a new, as yet unnamed home appliance retail company. The group's previous appliance retailer subsidiary, Sanlian Commercial (600898.SH), was recently the subject of a successful hostile takeover bid by rival retailer Gome (0493.HK).
The new company will be integrated with Sanlian, allowing it to utilize Sanlian's existing delivery platform for home appliances, franchising model and after-sales service platform.
In reprisal for the hostile takeover, at least 4 of Sanlian Commercial's 9 directly operated stores will be forced to either close or move location, as their retail space is leased from the Sanlian Group, which does not intend to renew their leases. The stores in question are responsible for approximately a quarter of Sanlian Commercial's turnover, or RMB 400 mln - RMB 500 mln. Sanlian Group will also strive to get the 100 existing Sanlian Commercial stores in Shandong province to join the new Sanlian.
Keywords: M&A 0493.HK 600898.SH Gome hardware home appliances retail Sanlian Commercial Sanlian Group
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