11 October 2004 LAWFUEL – Law, law firm, attorney, legal newsSimmons & Simmons has advised ABN AMRO Rothschild in its dual roles as financial adviser to Hong Kong-listed company GOME Electrical Appliance Holding Limited (“GOME”) in its acquisition of a majority stake in Beijing-based appliance chain GOME Appliance Co., Ltd. for a total consideration of approximately HK$8.3 billion, and as placing agent in a subsequent placing of shares of GOME by Shinning Crown Holdings Inc, a substantial shareholder of GOME, in a transaction raising gross proceeds of HK$1,194 million.
GOME Appliance, according to independent research, was the largest electrical appliances and consumer electronic products retailer in the PRC in terms of turnover between 2001 and 2003. GOME Appliance sells audio and visual goods, refrigerators, air-conditioners, telecommunication products and computers, and has an extensive retail network in the PRC. As of 30 September 2004, it operated 96 electrical appliance retail outlets in the PRC, covering 22 major cities including Beijing, Tianjin and Shenzhen. GOME Appliance plans to aggressively expand its mainland retail network, entering second-tier cities, and ultimately hopes to have increased its coverage to 190 outlets within two years. It also wants to open 478 smaller audio-visual and mobile-phone shops by 2007.
The deal was led by partners Nicholas Norris and David Neuville, supported by corporate consultant Victoria Lloyd. They were assisted by corporate associates Marianne Cheng, Gilbert Ho and Philip Ng.
David Neuville commented:
“We are delighted to have represented ABN AMRO Rothschild in both the initial acquisition and the subsequent secondary market placing. The transaction included a number of novel aspects, designed to ensure that the market was given full information at the time of the acquisition regarding the business, assets and financial results and condition of the post-acquisition company, ultimately allowing the selling shareholder to place its shares into a secondary market that had a comprehensive understanding of the company.”