Nanji E-Commerce Co.Ltd(002127) the acquisition of a well-known women’s fashion brand in South Korea is finally coming to an end.
On February 10, Nanji E-Commerce Co.Ltd(002127) announced that baijiahao (Shanghai) Fashion Co., Ltd. (hereinafter referred to as “baijiahao company”) has recently completed the industrial and commercial change registration and obtained the business license issued by the market supervision administration of China (Shanghai) pilot free trade zone.
According to tianyancha app, on February 9, baijiahao company had a number of industrial and commercial changes, the original shareholder TBH Hong Kong Limited withdrew and the new shareholder Nanji E-Commerce Co.Ltd(002127) ; The legal representative is changed to Xu Jinqi; The registered capital increased to about 433 million yuan, an increase of more than 561%.
In the relevant acquisition announcement in December last year, Nanji E-Commerce Co.Ltd(002127) pointed out that because the company has certain weaknesses in R & D, production and quality management, baijiahao has strong advantages in R & D, production and quality management, which can better supplement the company’s weaknesses in these aspects.
In this regard, Cheng Weixiong, a brand management expert in the footwear and clothing industry and general manager of Shanghai Liangqi Brand Management Co., Ltd., said in an interview with the reporter of the international finance news that Nanji E-Commerce Co.Ltd(002127) online business operation has reached the bottleneck period. Behind the above transaction, the company has to consider reform and breakthrough. To a certain extent, Nanji E-Commerce Co.Ltd(002127) is to get through online and offline and build its own brand matrix
M & a fashion enterprise
At the beginning of November last year, Nanji E-Commerce Co.Ltd(002127) issued an announcement about the company’s intention to sign an agreement, pointing out that the company intends to cooperate with TBH Global Co., Ltd and baijiahao Hong Kong Co., Ltd. signed the intention agreement to acquire TBH Global Co., LTD holds BASIC HOUSE, Mind Bridge, JUCY JUDY trademarks (including Chinese trademarks 100 good, 100 good deeds, etc.) in the Chinese mainland, Hongkong Special Administrative Region and Macao Special Administrative Region trademark ownership, and 100 good Limited Hong Kong Company holding hundreds of good companies 100% stake.
In December after that, Nanji E-Commerce Co.Ltd(002127) formal acquisition announcement was released. The board of directors agreed to hold a meeting with TBH’s own capital of 300 million yuan, and the board of supervisors agreed to hold a meeting with TBH’s own capital of 300 million yuan., LTD has registered some trademarks registered in the Chinese mainland and the Hongkong Special Administrative Region (including 78 trademarks including BASIC HOUSE, Mind Bridge, JUCY JUDY, etc.), and has purchased 100% of the 100 good companies held by hundreds of good Limited Hong Kong Company with its own capital of 180 million yuan.
According to the information disclosed in the announcement, the basic house brand was founded in 2000 and is a well-known women’s fashion brand in South Korea; Mind bridge brand, founded in 2003, is a well-known clothing brand in South Korea, with both business leisure and fashion styles; Jucy Judy brand was founded in 2003. It is a well-known clothing brand in South Korea, focusing on girls’ style.
Baijiahao company was established in 2004. According to the data in the Nanji E-Commerce Co.Ltd(002127) announcement, the company’s performance in recent years is not good. In 2020, the operating revenue of baijiahao company was 1.337 billion yuan, the total profit was – 174 million yuan and the net profit was – 183 million yuan. In the first nine months of 2021, the company’s operating revenue, total profit and net profit were 966 million yuan, – 66.7479 million yuan and – 66.7513 million yuan respectively. By the end of 2020 and September 2021, the net assets of 100 good companies were negative.
Nanji E-Commerce Co.Ltd(002127) once pointed out in the announcement that due to the rise of content e-commerce, the value of some famous and personalized brands is highlighted, and the acquisition of such brands is helpful to build the company’s brand system; At the same time, due to the company’s shortcomings in R & D, production and quality management, baijiahao has strong advantages in R & D, production and quality management, which can better supplement the company’s shortcomings in these aspects, make fuller preparations for the company’s integrated control of production, marketing and research in the future, and better provide consumers with good quality, good R & D, personalized and inexpensive goods.
On January 17 this year, Nanji E-Commerce Co.Ltd(002127) received the decision of the State Administration of market supervision on the non implementation of further examination in the antitrust examination of concentration of business operators.
On February 11, the relevant person in charge of Nanji E-Commerce Co.Ltd(002127) told the reporter of the international finance news that at present, the acquisition of relevant trademarks has not been completed. Please refer to the announcement for details.
Cheng Weixiong told reporters that the corresponding trademark registration and transfer takes time, but it should not affect the overall transaction of Nanji E-Commerce Co.Ltd(002127) or the operation.
According to Nanji E-Commerce Co.Ltd(002127) previously, after the completion of this acquisition, the target company will become a wholly-owned subsidiary of Nanji E-Commerce Co.Ltd(002127) and be included in the scope of the company’s consolidated statements. However, Nanji E-Commerce Co.Ltd(002127) also pointed out that this acquisition is in line with the company’s business development strategy, can better enrich the company’s brand system, is conducive to give full play to the company’s brand operation and maintenance ability, further broaden the company’s product level and enhance the company’s brand image. The acquisition will not have a significant adverse impact on the company’s short-term operating performance and financial situation
pathfinding under performance pressure?
Over the past period of time, Nanji E-Commerce Co.Ltd(002127) has acted frequently.
On July 2 last year, Nanji E-Commerce Co.Ltd(002127) issued an announcement on foreign investment and establishment of a joint venture, saying that it had reached cooperation with Xiya Yijia Trading Group Co., Ltd. (C & A (China)) on its “C & a” brand’s online business in China, and signed the shareholder investment agreement. C & A (China) has the legal authorization of the “C & a” trademark holder in China, Nanji E-Commerce Co.Ltd(002127) as its only partner in the “C & a” brand online business in China, both parties intend to jointly invest and establish a company (hereinafter referred to as “joint venture”).
According to the announcement, the registered capital of the joint venture is 1 million yuan, of which Nanji E-Commerce Co.Ltd(002127) contributes 600000 yuan, accounting for 60% of the registered capital; C & A (China) invested 400000 yuan, accounting for 40% of the registered capital. The joint venture will enjoy the online trademark use right of C & a trademark in China and become the only online operation partner of “C & a” brand in China.
At that time, Zhang Yuxiang said that in the following period of time, on the basis of doing a good job in C & A, he would also consider cooperation with third parties, especially foreign brands, “this is our long-term strategy”.
“From the perspective of business performance, Nanji E-Commerce Co.Ltd(002127) is still under pressure, otherwise it will not be possible to explore cross-border e-commerce, sign C & A, and acquire hundreds of good brands.” Cheng Weixiong pointed out.
According to the data, in 2020, Nanji E-Commerce Co.Ltd(002127) operating revenue was 4.172 billion yuan, a year-on-year increase of 6.78%; The net profit was 1.188 billion yuan, a year-on-year decrease of 1.50%.
According to the performance forecast released at the end of Nanji E-Commerce Co.Ltd(002127) January, it is expected that the net profit attributable to shareholders of Listed Companies in 2021 will be 430 million yuan to 550 million yuan, with a year-on-year decrease of 53.70% – 63.80%.
For the sharp decline in performance last year, Nanji E-Commerce Co.Ltd(002127) said that the main reasons for the change include two aspects. First of all, the traditional search channel Gmv has declined, the customer inventory pressure is large, and the corresponding brand comprehensive service revenue has declined significantly. Most of the company’s costs are fixed expenses such as manpower and rent, resulting in a sharp decline in profits and revenue. In addition, new projects such as cross-border e-commerce and food, which the company vigorously expanded this year, had large initial investment and had no obvious output, resulting in a decline in profits.
So, can the new business bring a leap in performance to Nanji E-Commerce Co.Ltd(002127) ? Insiders pointed out that over the past few years, the development of Baijiaxin’s Chinese market has not been smooth, and its brand voice is gradually decreasing. At the same time, it has also been punished for product problems for many times.
In the announcement, Nanji E-Commerce Co.Ltd(002127) also pointed out that due to the differences in development process, management concept and corporate culture, the company has some uncertainty about whether the integration effect of 100 companies can meet the expectations. “The company will strengthen the management of baijiahao, give full play to the enthusiasm of the company’s management personnel, ensure the effective control of baijiahao, realize the complementarity and effective coordination of the company’s existing businesses and resources, and reduce the integration risk.”
Cheng Weixiong pointed out that although Nanji E-Commerce Co.Ltd(002127) has many years of e-commerce online authorization and asset light management thinking, it is not a small challenge to build a brand model dominated by offline stores. However, the brands it receives this time have certain value, and stores with a certain scale are the basic sector. In addition, the design and R & D capabilities of these brands also exist. “It’s just how to integrate into the needs of Chinese user market, which is what foreign brands need to think about.”
