Significant investor interest as SPAR Shandong introduces initial public offering
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SPAR Shandong operators, Jiajiayue Group, who became SPAR International’s first retail partner in China in 2004, have launched an initial public offering (IPO) which saw the company listed on the Shanghai Stock Exchange.
Jiajiayue issued 90 million shares priced at 13,64 yuan per share to raise 1,23 billion yuan ($178,12 million). In late November, interest from investors saw the online portion of the IPO oversubscribed 4,407 times. The listing on the main A-Share exchange in China saw trading activity begin immediately after the opening on Tuesday ending 43% up on the first day of trading.
The market funding will be used to strengthen the business further by financing new store openings and existing store upgrades, developing distribution centres and logistics infrastructure and enhancing the existing technology and IT infrastructure.
Jiajiayue was the first SPAR partner in China and opened its first store in 2005 in the city of Weihai, north east China. Since then, SPAR China has opened 360 stores with nearly 1,000,000 sqm of selling space in eight provinces, employing over 30,000 people. It also operates eight distribution centres delivering across 50 cities.
“Jiajiayue was the first SPAR partner in China and opened its first store in 2005 in the city of Weihai, north east China.”
Speaking at the launch, Tobias Wasmuht, Managing Director of SPAR International said: “Today is a significant milestone, not just for SPAR Shandong, but also for the wider SPAR China family. All at SPAR are delighted to have contributed to the success of Jiajiayue, our founding partner of SPAR in China. Over the last 12 years the company has continued to lead the way, working closely with the growing list of SPAR Partners in China to grow and enhance the brand. Investor interest in today’s IPO is testament to the strength and vision of the company and its management team. This partnership embodies the values of SPAR and we look forward to growing together the scale of our retail network in Shandong and China as a whole.”
In addition to its partnership with SPAR, Jiajiayue Group Co. Ltd is involved in food processing, wholesale of agricultural products and foreign trade business. In total it operates over 400 stores with a selling space of 900,000 sqm in 34 cities within Shandong province such as Weihai, Yantai, Jinan, Weifang, Qingdao, Linyi, Laiwu and Zaozhuang.
The store formats cover hypermarket, supermarket, department store, neighbourhood store and discount store. The company has been recognised with a number of awards, including top 100 China FMCG Chain, Customer Satisfied Company in Shandong Province and Top Employer of China Retailing.
SPAR is the world’s largest voluntary retail chain with retail sales of €33 billion in 2015. With a presence now in 44 markets around the world, SPAR continues to be the partner of choice for independent retail partners keen to embrace retail best practice and fast-track their development in the face of international competition. SPAR International’s multi-format strategy sees its Partners operate over 12,100 hypermarket, supermarket, neighbourhood and convenience stores serving the needs of 13 million customers daily.
Questions & Answers
Q.How much capital did Jiajiayue Group raise through this initial public offering?
How much capital did Jiajiayue Group raise through this initial public offering?
Jiajiayue Group raised 1.23 billion yuan, which equates to approximately $178.12 million, from the initial public offering. They issued 90 million shares at a price of 13.64 yuan per share.
Q.How does Jiajiayue Group plan to utilise the funds generated from the IPO?
How does Jiajiayue Group plan to utilise the funds generated from the IPO?
The market funding will be used to bolster the business by financing new store openings and upgrades for existing stores. It will also support the development of distribution centres, logistics infrastructure, and enhance current technology and IT systems.
Q.When did SPAR first establish its presence in China, and how has it expanded since then?
When did SPAR first establish its presence in China, and how has it expanded since then?
SPAR International's partnership with Jiajiayue Group began in 2004, with the first store opening in Weihai in 2005. Since then, SPAR China has expanded to 360 stores across eight provinces, covering nearly 1,000,000 sqm of selling space.
Q.What other business activities is Jiajiayue Group involved in besides its partnership with SPAR?
What other business activities is Jiajiayue Group involved in besides its partnership with SPAR?
In addition to its SPAR partnership, Jiajiayue Group Co. Ltd is involved in food processing, the wholesale of agricultural products, and foreign trade business. It also operates over 400 stores of various formats within Shandong province.
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