ArtGo announces the acquisition of properties in prime location in Shanghai.
ArtGo is committed to exploring middle class market in China. The aggregate size of the properties is about 26,000 square feet, which is located in Puxi area and is next to Jing'an District. The Group believes that the acquisition will be beneficial for promoting the two brands under the Group, namely "ArtGo" which targets B2B construction market and "ArtMore" which focuses on B2C home decoration and retail market. The acquisition will also help to explore the Group's target customers in tier one cities in China and to introduce natural, simple and elegant marble products to the middle-class.
Shanghai is the financial, business and cultural center of China. The Group is hoping to relocate its headquarter to Shanghai in the near future. Given the superior geographical advantage of Shanghai, together with its influence on lifestyle and culture, the Group will focus on exploring the emerging middle class market by introducing the stylish and artsy home decoration marble products into their homes in order to boost the development of marble business in tier one cities in China. Apart from that, relocation of headquarter to Shanghai will provide a better connection with capital market for rapid business development.
The Consideration of HK$294,000,000 for this acquisition will be settled by the Group to allot and issue the Consideration Shares credited as fully paid at the Issue Price at Completion. The Issue Price of HK$1.13 per Consideration Share, which:1) represents a discount of approximately 10.96% to the closing price of HK$1.27 per Share as quoted on the Stock Exchange on the Last Trading Day; and 2) represents a discount of approximately 13.68% to the average closing price of HK$1.31 per Share for the last five trading days prior to the Last Trading Day. The Consideration Shares (being 260,000,000 new Shares to be issued) will represent approximately: 19.50% of the exiting issued share capital of the Company; and 16.23% of the issued share capital of the Company as enlarged by the allotment and issues of Consideration Shares. The Group believes that owning the properties will further enhance and develop its business growth and to generate greater returns for the shareholders in the long run.
Regarding the acquisition, Mr. Liu Chuanjia, the Chairman of ArtGo, commented, "In 2015, we focused on developing mid-to-high end decoration and retail market, and we launched a new brand called 'ArtMore' which targets mid-to-high end home decoration market. The newly acquired properties will be used for setting up the Shanghai Headquarter and marble showroom in the future, which aligns with the Group's long-term development strategies. In the long run, the Group is going to develop other emerging businesses including environmental-friendly construction materials and logistic etc. The acquisition definitely helps building a strong foundation for our future development in Shanghai and exploring new target customers in other first tier cities in China."
Source: ArtGo Holdings Limited
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|Date:||Feb 4, 2016|
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