Suning will take over Japanese Laox
0 Comment(s)
Print
E-mail
Shanghai Daily, June 29, 2011
Suning Appliance Co yesterday announced it will take majority control of Japanese electronics retailer Laox and open 150 Laox Life outlets in China in the next five years.
Laox will issue 9 billion yen (US$111 million) worth of 257 million new shares through a private placement to Suning.
After the deal, Suning's investment arm will hold 51 percent of Laox, and one of Suning's overseas affiliates will become Laox's second-largest stockholder with a 14.3 percent stake.
"The move is essential to Suning's long-term strategy to expand overseas and increase product lines," said Sun Weimin, Suning's vice chairman. "Laox will help us gain more knowledge of overseas markets and help us build a team for overseas expansion."
Suning, China's largest consumer electronics retailer, said it will attempt to integrate Laox's design and manufacturing advantages to develop supply chain for the company, learn advanced expertise for store layouts and services, and train employees through Laox stores to power its overseas expansion.
The 150 Laox Life stores will sell electrical appliances, furniture, toys, musical instruments and other consumer goods. They will be opened in 25 major cities in China.
Fan Zhijun, head of Suning's operations department, said Suning and Laox Life stores will procure independently but will share logistics, accounting and information.
"We have started to select sites in Beijing, Shanghai and Shenzhen. We may open two or three Laox Life stores by the end of this year," Fan said. "Each store will be between 10,000 and 20,000 square meters."
Laox Life will operate through in-house purchasing and will offer "a significant amount of imported goods," Fan said.
In 2009, Suning bought 66.67 million new shares from Laox at 12 yen apiece to become its biggest shareholder. Last year, Suning invested 2 billion yen to increase its stake in Laox to 33.8 percent.
Go to Forum >>0 Comment(s)