High-priced purchase of Nancheng Department store: The differentiation of step by step and city expansion

Absrtact: Despite the weakness of retail industry, the expansion of industry capital is becoming more and more active. May 11 Night, Hunan regional retail faucet step by step high commercial Chain Co., Ltd. (002251,SZ, referred to as step by step High) announced the announcement, step by step high and its subsidiaries will be issued shares


Despite the weakness of retail industry, industry capital expansion is becoming more and more active. On the evening of May 11, Hunan regional retail faucet step-step high commercial Chain Co., Ltd. (002251,SZ, referred to as "step by Step High") issued a notice disclosed that step by step high and its subsidiaries will be issued shares and pay cash in the way, the acquisition of one of Guangxi retail faucet Nancheng Department Store Co., Ltd. Shares。





, who began announcing new commercial territory last year, has built a "grand Southwest strategy". The launch of the annual A-share retail plate acquisition of the first shot, the retail industry, institutional analysts agree. Ping An securities analysis that, step by step high acquisition of Nancheng department stores, Hunan, Guangxi Intensive store layout is conducive to brand investment, logistics supply chain, management and other aspects to achieve synergy.





But there are also market participants believe that the retail industry is still in the downward stage, and there is no sign of stabilisation, has not been the best time to buy. "The company's asset sales to listed companies are valued at about 15 times times the 2014 earnings ratio, above the overall valuation level of the industry." "A retail industry analyst said," for Nancheng general merchandise shareholders to achieve high prices, but later in the industry risk spread to the listed companies and all shareholders. ”





step high into Southwest





Step by step high bucking the expansion, is the next big chess. In the company's 2013 annual report, the Chairman of the high step this year, the development will enter the rapid development of Fast lane, open up the "new business Long March", the implementation of the "big anti-C-word plan", that is, starting from Hunan, into Jiangxi, the reflexive kill into Guangxi, Guizhou, Chongqing, Sichuan and other markets, in China's commercial territory to create "China Wal-Mart".





as early as last May, step by step has opened the "Big Southwest Plan" Prelude, its branch began to settle in Guangxi Liuzhou, and thus advanced step by step high acquisition of Guangxi Retail market positioning leading Enterprises Nancheng department stores.





Public data show that Nancheng department stores and the pace of the same layout in the three or four-line city, for general merchandise + supermarket + electrical chain combination of integrated mode of operation, since its inception in 2001, in Nanning, Liuzhou, Guilin, Wuzhou, Yulin, Hechi, Baise, Kunming and other areas opened 38 stores, the total operating area of more than 450,000 square meters, One of its own property area of 60,000 square meters.





This transaction is completed, step by step high number of stores will reach 191, operating area of more than 2.2 million square meters, can further improve the pace of South West District in the operation of the network layout.





Guotai analyst Shang believes that Nancheng department stores in the local operating scale, network layout and channel advantages will be preliminarily established. Compared with the independent shop, direct acquisition is conducive to the company to accelerate the expansion process, reducing the risk and duration of the expansion of cross-regional.





Contrarian takeover risk





but the deal did not detonate the enthusiasm of the capital markets. May 12, one months after the suspension of the step-by-step high opening rose 5%, after a downward, until the end of the pull back to close to the limit, and the same day a-share index rose 41.73, deep card exponentially is up to 2.17%.





This step-by-step high purchase of Nancheng department stores of the transaction amount is expected to reach 1.575 billion yuan, of which nearly 1.5 billion yuan through the issue of shares in the way of purchase, shares issued price of 13.98 yuan/share. Nancheng department Stores 2013-year earnings per share of 0.51 yuan, the corresponding price-earnings ratio of more than 14 times times.





Shang that the purchase price of Nancheng department stores is slightly higher than the level of the company, but lower than the pace of their own level, so the acquisition price is basically reasonable.





and the retail industry that the weakness of the traditional retail industry in the short term to stabilize the rebound, the overall value of the retail industry, although already in the low, but still did not touch the bottom, relative industry downward trend, step by step high acquisition price is obviously high.





21st Century Economic report reporter inquires the latest industry data found that April 50 key large retail enterprises, retail sales fell 7% Year-on-year, is this year after the January-February retail sales year-on-year decline in retail sales year-on-year drop, and the decline is significantly more than 1-February. In the 5-June, the retail industry entered the traditional off-season, the catalytic driving factor is small, the overall business trend of the industry is not optimistic.





Tang Jia, the bank's international macro analyst, believes that the decline in CPI also has a negative effect on supermarket growth. Last week, the 000759,sz and Yong-Fai supermarkets (601933,SH), although the acquisition of mergers and acquisitions of increased expectations, still difficult to block down. The decline in the CPI trend is obvious, resulting in a certain resistance to the plate investors.





but the acquisition, through the capital market to achieve the two families of wealth reengineering. After the deal is reached, step by step high total share capital will reach 704.1968 million shares, step by step high group's shareholding is 39.06%, still is step by step high controlling shareholder, its actual control person still is chairman Wang fills in, and Nancheng department store founder Zhong Yongli will account for about 11%, will become step by step high second largest shareholder.





in Nancheng department stores in the original 6 shareholders, the holding of major shareholders, chairman Zhong Yongli and their family members actually hold Nancheng department store 85.85%. With the estimated transaction value of 1,575,780,000, the Zhong Yongli family will sit on a fortune of 1.3528 billion yuan after completing the transaction.





"The past ten years is the rapid development of the retail trade in the golden decade, and nearly two years of traditional retail industry into a significant market inflection point, Nancheng department store shareholders through the sale of assets to the listed companies, the listed companies will bear the later industry downward and enterprises to make money increasingly difficult reality and risk." "Now, regional retail companies are eyeing to realize their assets," the retail industry said. ”