Kunming Sinobright buys 5i5j.com for $900 million US

04 Apr 2017

Kunming Sinobright Group*, a nationwide department store operator in China, announced the acquisition of 94 percent of the real estate site 5i5j.com (registered as Beijing 5i5j Real Estate Brokerage), for about 6.18 billion RMB ($899 million U.S.), partly paid for in cash (1.8 billion RMB), and partly with the issuance of shares (4.3 billion RMB).

Kunming Sinobright also said it plans to sign a share transfer agreement for the acquisition of the remaining 6 percent for 378 million RMB, once a deal has been reached with the remaining 5i5j.com shareholders.  

The deal has been on the table since September of 2016, but was delayed when Kunming Sinobright’s shares were suspended from trading. The suspension was lifted on March 24 this year. Kunming Sinobright plans to raise 2.5 billion RMB in a private share placement to fund the acquisition. 

The acquisition has drawn attention from industry insiders, because Kunming Sinobright is a relatively small company. In fact, 5i5j.com’s 2015 revenue exceeded Kunming Sinobright’s by 400 percent.

Founded in 1998, 5i5j.com operates 2,215 branches in 15 cities in China, and claims to have had more than 33,000 pre-owned property listings in its home market of Shanghai alone in December last year.

*Bloomberg describes the company as follows: The company operates a department store in Kunming, which is involved in the wholesaling and retailing of general merchandise, household electric appliances, and other commodities. It also develops residential community and department store projects, and offers property management services. The company’s tourism business includes the operation of regular chain hotels. It operates primarily in Yunnan province, Beijing, and Jiangsu province in China. Kunming Sinobright (Group) Co., Ltd. is based in Kunming, China.

It is listed on the Shenzhen Stock Exchange, and will release its results for FY2016 on March 17. 

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Tom Marling

Tom is a PhD candidate in Chinese History at Hong Kong Baptist University, and former PR consultant in Mainland China. He joined the AIM Group in 2016 as a writer/analyst.