HONG KONG – Ground International Development Limited (“Ground International,” together with its subsidiaries the “Group”) has announced on 31 March 2017, that it has respectively entered into a memorandum of understanding (“MOU”) with Jiangxi Shengshuitang Cultural Tourism Development Company Limited (“Jiangxi Shengshuitang”) in relation to the establishment of a joint venture company (“JV Company”), and has also signed an MOU with Changchun City Ouya Shenlongwan Tourism Limited Liability Company (“Target Company”) in relation to a proposed capital injection to the Target Company. The Group targets to accelerate the pace of development and further expand its cultural tourism business.
The Group has entered a MOU with Jiangxi Shengshuitang and an individual investor (the latter two collectively, the “Possible JV Partners”) to jointly propose an establishment of a JV Company in the PRC, which will be principally engaged in the development of a cultural-tourism project in Nanchang, the PRC.
The cultural-tourism project will include the development of residential and tourism properties with tourism facilities. The registered capital of the initial joint venture company is RMB100 million and will be invested by Ground International and possible joint venture partners in cash by their respective equity interest.
It is expected to become a non-wholly owned subsidiary of the Group upon its establishment. Jiangxi Shengshuitang is a company established in the PRC and is principally engaged in tourism development; services of tourism products exhibition; tourism management services; scenic area management services; tourism hotel services; tourism advisory services; tourism project planning services; development and operation of and real estate projects; and property management.
The Group has also entered into another MOU on the same day to inject cash into an enterprise which is currently expanding and re-developing a tourist attraction project in Shenlongwan, Shanxi Province, a famous tourist zone in the PRC.
The company is principally engaged in the development of tourism projects and tourism souvenir and environmental products, construction and operation of tourist facilities, tourism information consultancy, conference and exhibition services, hotel management and property management services.
The Group has proposed to inject RMB200 million in cash into the Target Company (the “Proposed Capital Injection”). Upon completion of the Proposed Capital Injection, the Group is to ultimately own approximately 25% equity interest in the Target Company.
Ms. Chai Xiu, Chairperson and Executive Director of Ground International, said, “The Group has been striving to expand the cultural tourism projects in Jilin Province as well as other provinces in PRC with tourist attractions. Establishing Joint Venture Company and investing into tourism projects represent a major milestone for the Group to further taping into the cultural tourism business sector.”
In addition, the Group announced that it has won the public tender to acquire the entire equity interest in Jilin Zhongye Business Information Advisory Company Limited (“JL Zhongye”) and Jilin Fengrun Business Information Advisory Company Limited (“JL Fengrun”) with the total cost of RMB506 million.
JL Zhongye and JL Fengrun respectively hold 70% and 30% equity interest in Jilin Province Fengrun Guaranty Company Limited (“FR Guarantee”), which is a company principally engaged in the business of provision of guarantee services in the PRC.
After the completion of the Acquisitions, FR Guarantee will become an indirect wholly-owned subsidiary of the Group. For the year ended 31 December 2016, the net assets of JL Zhongye amounted to RMB360 million and the net profit after taxation was approximately RMB3.87 million. The net assets of JL Fengrun amounted to RMB150 million while the net profit after tax is approximately RMB1.21 million.
Chairperson CHAI, added, “The Group has been seeking opportunities to develop and expand its business into micro-finance sector in order to provide a suitable platform for optimizing values of existing business and to create synergies. Not only we will continue to strengthen our business territory in Jilin, we will also pay efforts to explore other fast-growing cities in the PRC that have growth and investment potential to increase the Group’s market share. We believe that the strategic acquisition, investment and cooperation will help bring long lasting benefits to the Group, achieving long-term sustainable development”. – BusinessNewsAsia.com