Chinese electronics retailer Suning Appliance Company Limited has announced plans to invest HKD215 million to acquire the businesses and assets of Citicall Retail Management Limited, an electronics retailer in Hong Kong.
The transaction is expected to be completed before the end of March 2010.
The company revealed that Suning Hong Kong, the wholly-owned subsidiary of Suning, will invest HKD35 million to acquire Citicall's brand, business and network. Meanwhile, it will acquire Citicall's stock and related assets for no less than HKD180 million. The payment will be realized in accordance to an installment plan agreed by the two parties.
Sun Weimin, president of Suning, told local media that Citicall expressed its intention to cooperate with Suning in May 2009. After several investigations, Suning decided to acquire Citicall and enter the Hong Kong market with this opportunity.
Sun said Citicall currently has 22 stores in Hong Kong and Suning plans to set up 50 new stores in this marketplace in the next three years. By then, Suning is expected to gain 25% share in the electronics retail market in Hong Kong.
Founded in 1976, Citicall Retail Management Limited is a retail chain that focuses on the retail and agency businesses of camera equipment, electronics, communications, audio-visual products, and computers. It is reported to be one of the top three electronics retail chains in Hong Kong with annual sales of about HKD1.3 billion. It currently has 22 retail outlets in Mong Kok, Tsim Sha Tsui, and Sha Tin.