China Duty Free Group (CDFG) announced on December 15 that it is taking a 100% stake in China CTS Asset Operations Corporation, a fully-owned subsidiary of CDFG’s majority shareholder, China Tourism Group. The transaction amount is CNY126,482,089.23 (US$19.8 million).
According to the rules governing the listing of stocks on the Shanghai Stock Exchange, this transaction constitutes a connected transaction and not a major asset restructuring. It therefore does not require review & approval byshareholders’ meetings.
CDFG said that the transaction is aimed at further enhancing its competitive advantage and mitigating competition with its majority shareholder, China Tourism Group. It will help create business synergy, consolidate duty free resources, and achieve sound, sustainable business growth, CDFG pointed out.
The move is the result of China Tourism Group’s commitment in September 2016 to mitigate peer competition and minimise and eventually eliminate business overlap between China Tourism Group and CDFG by 26 December, 2021.
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