Strengthen the Development Edge of NWDS in Central China Region
New World Department Store China Limited ("NWDS"; Hong Kong stock code: 825), one of the largest owners and operators of department stores in the PRC, is pleased to announce the Company has successfully acquired the operating right of a managed store in Changsha, Changsha New World Trendy Plaza ("Changsha Trendy Plaza"), at a consideration of RMB 10 million. The store is converted into a self-owned store from a managed store of NWDS.
Opened in September 2006, Changsha Store is the first department store of NWDS in Changsha. Providing a gross floor area of approximately 35,000 sq.m. in a seven-storey complex, the store is ideally located at Wuyi Avenue of Changsha City, Hunan Province, the southeast side of Wuyi Plaza, and it is only about hundred metres away from pedestrian street at South Huangxing Road. The location of Changsha Trendy Plaza is in the central business district of the city with convenient traffic, perfect public services, entertainments, restaurants, banks, hospitals and leisure facilities, which is the most ideal and competitive district for commerce and business.
As the "Rising Strategy of Central China" and the "Western China Development" are gradually rolled out by the Central government, more inhabitants and mobile population to different cities in Central China will be attracted, that will also simulate the development of retail market. In the first half of 2010, GDP of Changsha City achieved RMB 195.18 billion. In addition, the increasing in domestic spending power and the change of mode of living have resulted in RMB 84.98 billion retail sales of consumer goods recorded in the first half of 2010. Thus, citizens in Changsha City were thirst for retail and consumer goods. The government's stimulus plan has successfully boosted the domestic demands and the consumption demand of Changsha City, providing an ideal breeding ground for the further development of department stores.
As a "Fashion Gallery", Changsha Trendy Plaza is committed to consolidate its position by dedicating its effort to exploring young famous fashion brands. The store expands the business area of famous fashion brand and sports & casual wear as well as introduction of more brands to meet the taste of Changsha citizens. In addition, Changsha Trendy Plaza has introduced exclusive brands within the business circle on each floor of the store, bringing more diverse trendy living products for customers. Over the past year, Changsha Trendy Plaza was the pioneer in the Changsha department store industry by organizing games or engaging activities for VIP club members. VIP club members can actively participate in the event and foster their interaction with experts, brand salespersons and New World Department Store, therefore successfully attracted more VIP customers and stimulated their spending, which eventually increased sales volume. For example, "Cake DIY Program" and "Goodbye! Single Life" social gathering were tailor-made for Perfect House Wife Club members and Smart Lady Club members respectively while "Self-driving Tour" for Platinum VIP Club members, strengthening its interaction with customers.
Regarding the acquisition, Mr. Cheung Fai Yet, Managing Director and Executive Director of NWDS, said, "NWDS has been actively seeking desirable acquisition targets including acquisition of existing potential managed stores. Thus, the Company has acquired the operating rights of Shanghai Pujian Store, Beijing Store and Chengdu Store last year. ‘The Twelfth Five-Year Plan of Economic and Social Development of Changsha' was discussed during the executive meeting of Changsha Municipal People's Government held in November 2010. With the potential advantages of Changsha, they proposed to develop the city as the major strategic emerging industrial base, the international cultural city, the innovative urban city, the international city and the regional consumption centre, fully demonstrating an infinite development potential of Changsha City. After the acquisition of Changsha Trendy Plaza, NWDS has 6 self-owned stores out of 7 in Central China Region, further strengthening the development edge of Central China Region. Aside from the acquisition of current managed stores, we will actively seek worthwhile acquisition targets to facilitate quick inroads into new markets with prosperous growth potential, striving to be the leading department store operator in China."