HONG KONG: Dah Chong Hong Holdings Limited ("DCH", HKSE: 1828.HK) announced today that it has agreed to acquire 80% of Zhejiang Ciji, 100% of Yuyao Ciji, 100% of Ciji Xinghang and 80% of Cixi Chiao. These are acquisitions of luxury brand dealerships in the Zhejiang province and include two existing Mercedes-Benz dealerships (in Cixi and Ninghai), three authorisations for new Mercedes-Benz dealerships (in Yuyao, Fenghau and Cixi) and one existing Audi dealership (in Cixi) for a total of RMB920,800,000, and approximately HK$1,060,945,760. The deal will be funded by internally-generated cash and bank loans.
The luxury passenger car market in mainland China has experienced strong growth in recent years, with Mercedes-Benz and Audi amongst the most popular luxury brands. These acquisitions position DCH for growth in alignment with the luxury segment.
DCH has been a long-term partner of Mercedes-Benz and Audi. The acquisitions will increase the Group's number of Mercedes-Benz dealerships from four to nine when all new shops are opened. The Group's number of Audi dealership will increase from six to seven. By increasing the number of dealerships of these brands, DCH hopes to further strengthen the strategic relationship.
In 2016, Zhejiang province ranked fourth in mainland China in terms of Gross Domestic Product (GDP) and represented a significant market for luxury passenger cars. The acquisitions will strengthen DCH's geographical coverage in Eastern China and create synergy with the existing operations in the Zhejiang province cities of Ningbo, Jiaxing, Shaoxing and Taizhou.
This press release should be read in conjunction with the full text of DCH's HKEx Announcement dated 21 July 2017, which is available on https://www.hkex.com.hk and https//www.dch.com.hk.
Dah Chong Hong ("DCH", stock code: 1828.HK) is an integrated trading and distribution company operating in Asia, supported by an extensive logistics network. DCH is a leading distributor and dealer of motor vehicles in Greater China as well as a provider of a full range of associated services. DCH's consumer business comprises the manufacture and distribution of food, healthcare, electrical appliances, beauty and lifestyle products.
DCH has more than 68 years of experience in helping principals penetrate markets including China, Hong Kong, Macau, Thailand, Malaysia, Japan, Indonesia, Singapore, the Philippines and Brunei. As the preferred partner of over 1,000 brands from more than 30 countries, DCH offers a full range of value-added tailored solutions from positioning and marketing to wholesale, retail, after-sales support.
A subsidiary of China's largest conglomerate CITIC Limited (stock code: 0267.HK), DCH employs over 17,000 staff across the region. For more details, please visit www.dch.com.hk.