ZHONGMIN Baihui Retail Group Ltd is acquiring the retail premises at Hui'an County in Quanzhou city of Fujian province for 122.24 million yuan (S$24.88 million).
It said on Wednesday that its wholly owned unit Zhongmin Baihui (Quanzhou) Commercial Management Co Ltd (QZM) has inked five separate sale and purchase agreements with Hui'an Hongyi Property Development Co Ltd.
The vendor is a joint venture company that is owned by Fujian Hongyi Real Estate Group Co Ltd, Quanzhou Xinjiada Container Transport Co Ltd and Quanzhou Zhongmin Baihui Shopping Co Ltd (Quanzhou ZMBH) with stakeholdings of 30 per cent, 40 per cent and 30 per cent respectively.
This transaction constitutes an interested person transaction since the three shareholders of Quanzhou ZMBH are directors of Zhongmin Baihui. They are Chen Kaitong (group CEO), Su Caiye (non-executive director) and Su Jianli (deputy CEO). The legal representative and sole director of Quanzhou ZMBH is also Mr Su Caiye.
Explaining the rationale for the deal, Zhongmin Baihui said that it has been operating the Hui'an department store at the premises under a lease agreement since April 1, 2013.
"The proposed acquisition will result in QZM having full title and ownership of the premises, hence allowing the QZM to have full control, access and right over the operations and management of the premises, as well as all of the economic benefits of the Hui'an store," it added.
The deal is conditional upon the approval of shareholders at an extraordinary general meeting to be convened.