City’super banks on China connection to tap consumption upgrade story as Hong Kong retail industry slumps

China Resources and other investors buy 65 per cent of supermarket chain for undisclosed sum from sellers including billionaire Peter Woo

New owners seek to grow City’super by leveraging synergies with other own ventures like Ole, CR Vanguard

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A City’super outlet in Times Square, Causeway Bay. Photo: Nora Tam

Published: 4:49pm, 7 Aug 2020Updated: 4:49pm, 7 Aug 2020

A group led by conglomerate China Resources Group has bought a controlling stake in Hong Kong’s premium supermarket chain City’super in a move to tap into high-end consumption in the mainland Chinese market.

Its investment arm China Resources Capital Management and Asia Food Growth Fund took a 65 per cent stake in City’super (BVI) from existing shareholders for an undisclosed sum. The sellers included Lane Crawford Joyce Group, a private business owned by billionaire Peter Woo Kwong-ching.

“We trust that our new partners will help consolidate our success and accelerate our growth in China, and help us adapt to a rapidly changing marketplace,” Thomas Woo, the chain’s chief executive, said in the statement on Friday.

The City’super group has a network of 20 stores in Hong Kong and six in Shanghai, under both the supermarket chain and LOG-ON retail outlets.

The transaction added to an otherwise weaker year for mergers and acquisitions in the global retail industry, where volume has shrunk 17 per cent to US$72.2 billion, according to data compiled by Refinitiv. In Hong Kong, retail sales have slumped for 17 straight months amid the city’s worst recession on record.