On December 17, Alibaba (HK:09988) announced that it, along with a minority shareholder, agreed to sell 100% of its equity in Intime Department Store to a consortium led by Youngor Group and members of Intime’s management team.
According to the announcement, Alibaba currently holds approximately 99% of Intime’s equity. The total proceeds from the sale are estimated at 7.4 billion RMB (approximately $1 billion). Alibaba expects to record a book loss of about 9.3 billion RMB (approximately $1.27 billion) from the transaction.
Following the news, Youngor Group’s share price rose 3.65% to 9.38 RMB per share at the close of trading today, bringing its total market capitalization to 43.4 billion RMB (approximately $6 billion).
About Intime Department Store
Founded in 1998 with its first store, the Intime Wulin Store in Hangzhou, Intime has grown over two decades into one of the leading retail department store chains in the Chinese Mainland. It has developed or plans to develop over 60 projects.
In 2007, Intime Department Store became the first privately owned department store from the Chinese Mainland to list on the Hong Kong Stock Exchange, setting a precedent for Zhejiang-based commercial stocks. In 2013, the company changed its name to Intime Retail (Group) Co., Ltd.
Alibaba’s History with Intime
In March 2014, Alibaba made a strategic investment of 5.37 billion HKD in Intime Retail, acquiring a 9.9% stake and convertible bonds worth approximately 3.71 billion HKD. By 2016, Alibaba increased its holdings to 27.9%, becoming the largest shareholder. In January 2017, Alibaba partnered with Intime’s founder Shen Guojun to privatize the company in a deal worth 19.8 billion HKD (approximately 17.7 billion RMB). Subsequently, Alibaba increased its stake to approximately 74%, and in 2018, it raised its ownership to about 99%.
Youngor Group’s Expansion Strategy
In recent years, Youngor Group has actively expanded its retail channels. The company has pursued a “large-store strategy” while investing in premium properties.
This year, Youngor opened its top-tier retail format, “Fashion Experience Halls,” in cities including Ganzhou, Nanchang, Jinan, Zhengzhou, Changchun, and Guiyang. Recent openings in Taiyuan, Wenzhou, and Wuhan bring the total number of locations to 12. Youngor plans to expand to 30 Fashion Experience Halls across key cities in the Chinese Mainland.
It is worth noting that all buildings housing these Fashion Experience Halls are owned by Youngor.
Over the past three years, Youngor has heavily invested in acquiring high-quality properties in prime locations, including Nanchang, Wuhan, Guiyang, Chengdu, Xi’an, Changchun, and Shenyang. The company has spent over 3 billion RMB on these acquisitions.
| Source: Official Announcement, Luxe.CO Historical Reports
| Image Credit: Company Website
| Editor: LeZhi
