Nanjing-based Suning Appliance is to take over Citicall Retail Management, one of the oldest and biggest retail players in Hong Kong, in a HK$35 million deal that will give it a foothold in the city's crowded market.
The unexpected sale of 33-year-old Citicall by Tang Shing-bor, dubbed 'the king of commercial property', effectively means Tang is withdrawing from the retail sector.
Suning, which is listed on the Shenzhen Stock Exchange, planned to expand the sales network of Citicall from 22 now to about 50 in three years and pledged to retain the retailer's 300 employees, Suning president Sun Weimin said. Sun declined to specify the size of future investments.
Tang's son, Stan Tang Yiu-sing, said the family would focus on commercial investments.
The family, through Success Group, is active in dealing in retail shops and office buildings in prime areas such as Mong Kok and Causeway Bay. 'We were reluctant to cut the deal, but we had to after making the decision to concentrate on the property business,' said Stan Tang.
The Tang family took over Citicall three years ago. Stan Tang said Citicall generated HK$1.3 billion in sales per year and was profitable.
Citicall was started in Mong Kok in 1976 as a distributor of photographic equipment and audio and has risen to become one of Hong Kong's top three players in the sales of consumer appliances, computer and communications products.