SHANGHAI Tang, the retailer which made Chinese fashion and design chic for the upwardly mobile, has fallen into foreign hands. South African tobacco and luxury goods group, Rembrandt, has paid US$13.1 million for a majority shareholding by acquiring new and additional shares. David Tang, a large shareholder and creator of the Shanghai Tang design concept, said the purchase of the stake by the owner of the Cartier, Dunhill, Piaget and Mont Blanc brands would allow his group to develop its brand name internationally. 'We want to be in the position to create and sustain China's first international brand and this deal will allow us to draw on a vast amount of branding experience,' Mr Tang said. He described it as a strategic partnership which would allow him control over the day-to-day management and marketing development of Shanghai Tang. There would be no change to the fashion concept after the purchase and the Rembrandt group's branded products would not be sold through the existing or future Shanghai Tang retail outlets, Mr Tang said. The South African group recently took a substantial minority shareholding and yesterday completed arrangements to boost the stake to slightly above 50 per cent through more share purchases. The five largest investors in Shanghai Tang will remain shareholders. Rembrandt has the right to make a further small increase in its shareholding. Shanghai Tang has broken even since its opening 18 months ago but made a profit for the first time this month, according to Mr Tang. The South African purchase took place after the group carried out two months of due diligence work on Shanghai Tang's accounts and business operations. It grew out of the 15-year acquaintance between Mr Tang and Johann Rupert, the heir to the vast Rembrandt fortune which has developed through a diverse range of investments, centred on cigarette production. The South African group controls the Rothmans and Dunhill brands but the empire has expanded through its Swiss-based Richemont arm, the operator of the luxury brands division. Richemont effectively holds the stake in Shanghai Tang. The deal is the forerunner to a move by Shanghai Tang into franchising and direct mail operations which would put the brand name into Western markets, especially Britain and the United States. There are plans to open a store in London and discussions have been held with several parties interested in entering the venture. A Shanghai Tang shop will open soon in the Shanghai Museum and the group will handle the marketing and merchandising for the museum.