Electronics retailer gets 10b yuan credit line from state lender
Suning Appliance, China's largest electronics retailer by market value, has secured a five-year 10 billion yuan credit line from state policy lender China Development Bank to fund its expansion amid growing competition in the sector.
The retailer would borrow an initial tranche of 800 million yuan to build or buy four to five flagship stores and build three or four logistics centres in first and second-tier cities, officials said yesterday.
'China Development Bank mainly invests in infrastructure and these loans are intended for fixed asset investment,' according to one Suning official.
Last year China Development Bank said it would dedicate 50 billion yuan of policy loans to help develop China's top 20 retail companies and Suning was the first recipient of such a loan.
The interest rate will be the same as the standard bank lending rate but at a time when electronics retailers are rapidly consolidating, China Development Bank allowed the company a 15-year repayment period.
In the next three to five years Suning will build about 30 logistics centres as part of a national logistics network that will be able to support delivery and sales of 150 billion yuan worth of retail electronic products annually.