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Sim Leisure inks theme-park deal with Guangzhou Daxin
SIM Leisure Group on Friday announced the signing of a cooperation agreement with China-based Guangzhou Daxin Water Park Equipment, under which the company will monetise its name in the theme-park industry through a partnership with Guangzhou Daxin.
The agreement will grant Guangzhou Daxin the right to use “Sim Leisure” as the name to secure theme-park design and building contracts within China and the Asean region, in return for a 5 per cent royalty payment to the company’s 60-per-cent owned subsidiary, Sim Leisure Creative.
The remaining 40-per-cent shareholding interests in Sim Leisure Creative are held by Wesley James Rae (30 per cent), the former non-executive non-independent director of Sim Leisure; and Josie Booth (10 per cent), who was a senior manager with the company prior to its listing since 2013.
Guangzhou Daxin is one of the biggest waterpark designers, equipment suppliers and contractors in China, with a turnover of US$50 million at its peak in 2016, Sim Leisure said.
"The potential in China is considerable, based on statistics in 2017 that indicated that over half a billion Chinese visited an amusement park. Amusement park spending in China was forecast to surpass US$6 billion by 2019, making China the world's fastest-growing market. Aresearch report on Chinese theme parks stated that 64 new parks were expected to be established between 2015 and 2020, with a total investment of about US$24 billion," it added.
The group believes that this construction trend is set to continue, given the demand for domestic amusement park markets, as domestic tourism continues to become more popular in China.
Founder Sim Choo Kheng said this is the "right moment" he has been waiting for to enter China and the Asean market. "We are ready for the next stage of growth with our new partner Guangzhou Daxin Group, capitalising on our common business philosophy of providing Asian business economics with a global approach in our creativity.”