Golden Eagle Retail Group has entered into a purchase agreement for the acquisition of a parcel of land in Yancheng, Jiangsu for the development of a new department store.
The site area is estimated to be 11,227 sqm with an expected consideration of RMB84,610,000. The final consideration will be subject to the actual site area. The Group intends to set up a new store on the site, which is expected to have a total GFA of approximately 50,000 sqm.
The Group will fund the acquisition with internal resources, including cash and proceeds raised from the Groups initial public offering in March, and the zero-coupon convertible bonds issued in September. Upon completion of the acquisition and setting up of the new store, proportion of the Group's self- owned versus leased operating area is expected to be ramped-up from the current 69%, complementary to the Group's strategy preference to operate on self-owned premise and secure the costs of operation in the long run.
Roger Wang, Chairman of the Group, commented, "The Group has always targeted second-tier cities in China with strong growth potential, and is especially favourable in view of the strong domestic consumption from within Jiangsu Province. We are confident that the new store will reiterate our presence and expand our market share in the Province of Jiangsu."