Big Three They Gathered The Capital Market Home Appliance Chain Re-shuffle – Home Appliance Chain –

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Yongle Home Appliances chairman Chen Xiao has acknowledged in public funding has been absorbed by Morgan Stanley matter, and said the next step will be for years, listed in Hong Kong

Following the country the United States in Hong Kong, listed in Shenzhen after Suning, Shanghai Yongle also listed the pace of the countdown. It is said that Yongle Home Appliances chairman Chen Xiao recent “WTO context of the rise of private business ” seminar, for the first time publicly acknowledged

Absorbed by the injection of Morgan Stanley regarding the company, and said plans for next year, listed in Hong Kong.

Industry believes that, with the three largest home appliance chain enterprises they gathered the capital market, China’s home appliance chain “giant ” struggle will be intensified. Meanwhile, China’s home appliance chain industry concentration will be further enhanced.

Morgan Stanley to enter Paradise

Early as the first half of last year, the industry has been Shengchuan Yong Yue appliances will be listed with Morgan Stanley. However, the parties without making the matter has been publicly disclosed.

January 7 this year, in the “WTO context of the rise of private business ” seminar, Yongle Home Appliances chairman Chen Xiao for the first time publicly confirmed that Morgan Stanley will be 50 million U.S. dollars was Yongle Home Appliances 20% of the shares and became the third largest shareholder of Yongle. At the same time, it will help the Wing-lok, listed in Hong Kong. At present, the transactions have received the formal approval of the Ministry of Commerce. The scale of financing listed Yongle, Chen Xiao did not disclose, but said the money mainly into financing procurement, store construction, expansion, and network.

It is reported that Wing-lok, a total of 108 home appliance stores, after Gome, Suning. Under the plan, this year the company will be integrated traditional household appliances shop mainly in the North, South, Southwest and other places to step up expansion of stores by the end of the whole country had reached 250, and into Beijing, Nanjing, Shenzhen, Gome, Suning has been done The primary market is very strong.

Listed real intention of the Yongle

Headquarters in Shanghai Yongle Home Appliances is a privately owned company, according to Commerce Department data showed first half of 2004 Yongle Home Appliances 65 billion, ranks ninth in the Chinese chain, has 74 stores across the country.

This time Yongle seeking overseas listing, the industry generally believe that Paradise is not capitalized on in order to be old rival —— Gome, Suning Shuaixia; the same time, also for the future expansion of the necessary capital accumulation.

Shanghai Securities Research Institute Co., Ltd. analyst Jin Zefei SW said chain elements of the first big competition is for the pursuit of scale, while the scale of development will depend on strong capital strength. Use of capital market financing function, attain their own funds needed for development and growth should be listed on the main purpose of chain enterprises. Thus, while Paradise is not a lack of funds has been claimed, but eventually the United States or the country to take the old road, that is, to raise funds through capital operation.

Guotai Junan the analysts also said that both the scale of expansion or brand building, Yongle will need huge financial backing, the relative single channel of financing for private enterprise, market is undoubtedly the best choice. Wing-lok, and Morgan Stanley claimed that cooperation is mainly Chinese and the latter’s global resources and a governance model, not the industry’s urgent need of expansion capital rumors. But with global resources of the world’s top investment bank Morgan Stanley to enter Paradise, the Paradise of the IPO will undoubtedly attract more overseas investors, the capital of the Wing-lok, a tremendous role in promoting the objectives.

Home appliance chain industry will re-shuffle

Is no doubt that once the successful listing of Paradise, the three major home appliance chain in China giant will they gathered in the capital markets, this will be the home appliance chain business in China affect the pattern of it? Researchers given the answer is yes.

Jin Zefei that Paradise will make the first listing of the three “giant ” more intense competition between; more importantly, this competition will lead to increased concentration of the industry, as well as the industry’s intense competition. She pointed out that, according to a global chain industry development trend of view, a regional chain will be less and less competitive advantage. Next, the integration of acquisitions will be the big three primary ways to achieve expansion. Although, Gome, Suning, Yongle in the field of domestic home appliance chain has been described as “giant “, but compared to the great chain of foreign enterprises, the scale is still small.

Jinze Fei said the retail sector in 2005 is a watershed, because China will honor its WTO commitments, foreign distribution companies to completely liberalize the restrictions, Gome, Suning, Yongle and so will Wal-Mart and other multinational giants on the same stage chain fighting. In this case, after listing the home appliance chain is expected to expand by virtue of its powerful capabilities and capital platform, essential home appliances and circulation integration, which will allow small business to home appliances market share brought together to enhance the circulation of the concentration of household appliances enhance the home appliance chain enterprises in China’s overall competitiveness.