Mingtiandi

Asia real estate and outbound investment news

  • Facebook
  • LinkedIn
  • RSS
  • Twitter
Sign Up / Login Logout

Lost your password?
Register
Forgotten Password
Cancel

Register For This Site

A password will be e-mailed to you.

  • Capital Markets
  • Events
    • Join the Mingtiandi Proptech Forum 2021
      • Asia Proptech 2021: COVID-19 Accelerates a Trend
      • Panel Talk: Tech Adoption in Logistics Real Estate
    • Promote Your Brand with the Mingtiandi Proptech Forum 2021
    • 2021 Mingtiandi Event Calendar
    • More Events
  • MTD TV
  • People
  • Logistics
  • Asia Outbound
  • Retail
  • Design & Construction
  • Research & Policy
  • Advertise

China Resources-Led Group Buying Hong Kong Supermarket Chain for $300M

2020/08/08 by Jonathan Burgos Leave a Comment

city super

A City Super store in Hong Kong

China Resources Capital Management, the alternative investments arm of China’s state-owned conglomerate China Resources Holdings, said Thursday it and partner Asia Food Growth Fund have signed an agreement to buy a 65 percent stake in Hong Kong-based high-end supermarket chain City Super Group.

The company, with businesses spanning property development, retail, brewery, pharmaceuticals and energy, didn’t disclose the purchase price, which Bloomberg earlier reported as $300 million. Subject to Chinese regulatory approvals, the transaction is expected to be completed by the fourth quarter of this year.

Yardi Lease Manager

The Chinese conglomerate is acquiring the controlling interest in City Super from existing shareholders Fenix Group, a privately held Hong Kong-based fashion retailer, and real estate tycoon Peter Woo’s Lane Crawford Joyce Group. Fenix and Woo will retain 35 percent of Super City after the deal.

Accelerating Expansion in China

“Our new partners will help consolidate our success and accelerate our growth in China, and help us adapt to a rapidly changing marketplace,” said Thomas Woo, CEO of City Super. “We look forward to the broader partnership with China Resources.”

china resources fu yuning

China Resources chairman Fu Yuning looks pleased with his new stores

With the backing of China Resources, City Super plans to accelerate its expansion in the mainland to tap on China’s growing consumption. The company said it also expects to derive synergies from working together with China Resources’ chains of Vanguard and Ole supermarkets.

Established in 1996, City Super currently operates 20 supermarkets in Hong Kong and seven each in Shanghai and Taiwan. Its premium grocery stores are located in prominent locations such as Hong Kong’s IFC Mall, a waterfront integrated shopping and office complex in Central that counts global banks such as UBS Group AG among its tenants.

MTD Proptech Report

The acquisition comes amid recent moves by China Resources to consolidate its position in the mainland China supermarket industry.

Consolidating China Resources’ Supermarket Business

Just as the Covid-19 pandemic spread across the world in February, China Resources bought out the 20 percent stake held by its partner, Tesco, in a mainland China supermarket joint venture between the two companies, marking the exit of Britain’s largest retailer from the Chinese market.

Peter Woo Wheelock

Billionaire Peter Woo is among the shareholders selling to China Resources

“We are convinced that China Resources is the ideal partner for City Super to fully realise its potential given our leading position in China’s food retail market, our local knowledge and our strong and proven expertise in growing multinational brands in China,” said Carl Qin, CEO of China Resources Capital Management.

Hong Kong-listed China Resources operates almost 3,000 supermarket stores across China. The group is among China’s biggest food and beverage companies, supplying rice, meat, frozen food, fruits and vegetables across the mainland and Hong Kong, according to its website. It also brews Snow Beer and distributes bottled purified water.

Challenging Hong Kong Retail Outlook

The City Super deal is the maiden transaction for Asia Food Growth Fund, a vehicle jointly managed by China Resources, Bahrain-based Investcorp and Fung Investments, a private investment vehicle controlled by Li & Fung chairman Victor Fung and his brother William.

Under its new ownership, City Super plans to step up expansion into China amid signs the country’s economy is bouncing back from the economic slump caused by the Covid-19 pandemic. China’s GDP rose 3.2 percent in the second quarter after contracting 6.8 percent in the period from January through March, government data released in July showed.

MTD Proptech Report

In contrast, Hong Kong’s economy continues to sink deeper into recession, with GDP growth slumping another 9 percent in the second quarter. The city’s retail sector has taken the brunt of the coronavirus economic blow, even as it was already reeling from months of pro-democracy protests.

The value of the city’s retail sales fell 24.8 percent year-on-year in June. The one bright spot is supermarket sales which rose 4.5 percent in June from a year ago.

Despite the resilience of the supermarket industry, the recovery of Hong Kong’s broader retail sector will depend on when the Asian financial centre reopens its borders to tourists and business travellers, said Kevin Lam, executive director and head of retail services at Cushman & Wakefield in Hong Kong.

“Without these tens of millions of visitors’ support, the general retail sector in Hong Kong is still under the biggest challenge ever,” Lam said. Visitor arrivals in Hong Kong tumbled 90 percent in the first half of this year to 3.5 million from a year ago as the government restricted flights to the city in a a bid to curb the further spread of coronavirus.

Related Stories

  • China Resources Unit Said Buying HK Industrial Asset for HK$820MChina Resources Unit Said Buying HK Industrial Asset for HK$820M
  • Li & Fung Delists After Completing HK$7.2B GLP-Led BuyoutLi & Fung Delists After Completing HK$7.2B GLP-Led Buyout
  • GLP Backs HK$7.2B Buyout of Hong Kong’s Li & FungGLP Backs HK$7.2B Buyout of Hong Kong’s Li & Fung
  • Billionaire Bids HK$48B to Privatise HK Developer WheelockBillionaire Bids HK$48B to Privatise HK Developer Wheelock

Share this now

  • LinkedIn
  • Share
  • Tweet
  • Email

Filed Under: Retail Real Estate Tagged With: China Resources Capital, China Resources Holdings, daily-sp, Featured, Li and Fung, Peter Woo

MTD Proptech Report Download

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Yardi Commercial Cafe

Get Mingtiandi Delivered

MTD Proptech Report

Latest Stories

JLL Alex Barnes

Office Vacancy in Hong Kong’s Central Tops 7% for the First Time Since 2004

laurent-jacquemin axa

AXA IM Breaks Ground on $260M Nagoya Distribution Centre with ESR

Amazon Asks India Court to Jail Erstwhile Partner and More Asia Real Estate Headlines

Ben Cha Grosvenor

UK Developer Grosvenor Appoints Kozo Hiratani as Japan President

Sponsored Features

Tony Horrell

Colliers’ Global Investor Sentiment Report Anticipates Up to 50% Surge in Investment in 2021 Sponsored Feature

Andrew-Slevin-John-Foord (4)

Insurtech to Help Address Underinsurance Across Asian Real Estate Assets in 2021 Sponsored Feature

CK Lau

Asia Pacific Logistics Sector: Increasingly Varied Sector Requires Multiple Approaches Sponsored Feature

COVID-19 Uncertainty Creates New Priorities for Real Estate Investors Sponsored Feature

More Sponsored Features>>

MTD-QR-Code-320

Top Stories

Singapore’s CDL Warns of Loss After China Developer Investment Swells to $1.4BSingapore’s CDL Warns of Loss After China Developer Investment Swells to $1.4B

JLL Recruits Finance Veterans to Fill Japan, India Leadership Posts JLL Recruits Finance Veterans to Fill Japan, India Leadership Posts 

Asia Real Estate People in the News 2021-01-25Asia Real Estate People in the News 2021-01-25

UK Developer Grosvenor Appoints Kozo Hiratani as Japan PresidentUK Developer Grosvenor Appoints Kozo Hiratani as Japan President


Connect with Mingtiandi

  • Facebook
  • LinkedIn
  • RSS
  • Twitter

Real Estate News

  • Capital Markets
  • Events
    • Join the Mingtiandi Proptech Forum 2021
      • Asia Proptech 2021: COVID-19 Accelerates a Trend
      • Panel Talk: Tech Adoption in Logistics Real Estate
    • Promote Your Brand with the Mingtiandi Proptech Forum 2021
    • 2021 Mingtiandi Event Calendar
    • More Events
  • MTD TV
  • People
  • Logistics
  • Asia Outbound
  • Retail
  • Design & Construction
  • Research & Policy
  • Advertise

More Mingtiandi

  • About Mingtiandi
  • Contact Mingtiandi
  • Newsletter Subscription
  • Terms of Use
  • Privacy
  • Advertise
  • Join the Mingtiandi Team

We use cookies in accordance with our Privacy policy to provide the best user experience on Mingtiandi and to safeguard user data. By continuing to browse you consent to the policy. AcceptRefuse