CHINA. Publicly listed Gree Real Estate Co., Ltd is to purchase 100% of Zhuhai Duty Free Enterprise Group Co. Ltd (Zhuhai Duty Free) as part of a major asset restructuring plan announced late last week.
The plan for the long-anticipated deal shows that Gree Real Estate intends to issue shares and pay cash to the Zhuhai State-owned Assets Supervision and Administration Commission and Urban Construction Group to purchase the 100% holding.
If this major asset reorganisation is successfully completed, Gree Real Estate will then invest in tax free businesses “with good industry prospects, outstanding competitive advantages, and strong profitability”, the group said.
“In recent years, under the leadership of Zhuhai State-owned Assets Supervision and Administration Commission, the reform of state-owned enterprises in Zhuhai has achieved remarkable results,” Gree Real Estate continued.
The group added: “The reorganisation and reform of Gree Real Estate and Zhuhai Duty Free once again confirmed that under the guidance of the ‘industry first’ strategy, Zhuhai City will make every effort to improve the operating capabilities and management efficiency of state-owned enterprises, and to make state-owned capital better, stronger and bigger.”
Gree Real Estate, listed on the A-share market in 2009, is one of Zhuhai’s most influential and powerful listed companies. It is mainly engaged in real estate development, principally in Zhuhai, Shanghai, Chongqing, Sanya and other cities. It played a key role in the building of the acclaimed Hong Kong-Zhuhai-Macao Bridge Zhuhai Port.
“This plan shows that through this major asset reorganisation, Gree Real Estate will develop into a large consumer industry dominated by tax-free business, a promising biomedicine and health industry, and a real estate industry that adheres to the high-quality line as its core,” the group said.
Powerful pioneer of duty free
Founded in 1980, Zhuhai Duty Free is a first-level state-owned enterprise under the Zhuhai State-owned Assets Supervision and Administration Commission. It is among the pioneers of China’s duty free business.
It provides duty free retailing services for nearly 200 million domestic and foreign tourists every year (based on pre-pandemic conditions). With China’s duty free industry gradually opening up to competition, in recent years, Zhuhai Duty Free has focused on Hengqin and Hainan, actively explored duty free in Zhuhai City, expanded its presence in major domestic airports and port duty free shops, and further cultivated its national competitive advantage, Gree Real Estate noted.
Tender success
After winning a tender for the departures duty free shop project at Hengqin Port in June, Zhuhai Duty Free was again successful in being awarded the operation rights of the departures duty free shops at Zhongshan Port and Zhuhai Wanzai Port on December 2 and 6, respectively. It also successfully deployed two strategic locations within the Greater Bay Area’s duty free sector.
Zhuhai Duty Free has now formed a “comprehensive” business development and operation business system with duty free business as the core, Gree Real Estate noted. “Activities include port duty-free, diversified commerce, cross-border business, port economy, commercial integration, and online channels.”
After the post-acquisition reorganisation is completed, and through the introduction of a steady stream of capital flow, Zhuhai Duty Free’s momentum will surge, Gree Real Estate said.
“If the reorganisation is successfully implemented and implemented, Gree Real Estate will surely gather stronger resources and industrial advantages, continue to empower Zhuhai Duty Free, and become the vanguard of the duty free consumption industry in the Guangdong-Hong Kong-Macau Greater Bay Area and Hainan Free Trade Port. This will bringing all shareholders more generous returns and make greater contributions to local economic development,” the company concluded.
