Wumart acquires 85% stake in Shaoxing Shangchao Investment

Sep. 2, 2008 (China Knowledge) - Beijing-based Wumart Stores Inc<8277>, one of the leading supermarket chains in China, announced on Aug. 28 that its wholly-owned subsidiary Hangzhou Tiantian Wumart Commerce Co. Ltd had acquired an 85% stake in Shaoxing Shangchao Investment Co. Ltd for RMB 151 million.

Through the acquisition, Wumart will indirectly hold a 54.09% stake in Zhejiang Gongxiao Supermarket Co. Ltd, which had a network of 87 supermarkets and convenience stores and one distribution center in Shaoxing city by the end of 2007.

In 2007, Zhejiang Gongxiao's sales totaled to RMB 461 million with net profit of RMB 23.46 million, while revenue for the first half of 2008 amounted to RMB 308 million with a net profit of RMB 13.55 million.

Fu Yu, chief PR officer of Wumart, told sources that Wumart will further expand its presence in East China by adding four more stores in Hangzhou and Huzhou.

In 2006, Wumart had planned to acquire a 50% stake in Jiangshu Time Supermarket for RMB 1.12 billion. However, the plan fell through as a top executive of Wumart was involved in some legal investigations.

Currently, Wumart runs four supermarkets in Hangzhou, capital of Zhejiang province.