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Deyin restructures STO stake
Posted on Thursday, 09 May 2019 12:58
Shanghai Deyin Investment Holding is considering transferring a significant portion of its majority stake in STO Express to two wholly owned subsidiaries in order to improve the shareholding structure of the Chinese courier.
The controlling investor has established Shanghai Deyin Derun Industrial Development and Shanghai Gongzhirun Industrial Development to acquire 46.0 per cent of the listed delivery group for an aggregate CNY 14.65 billion (USD 2.16 billion).
It is transferring 415.71 million shares equating to a 29.9 per cent stake to the first subsidiary and an additional 246.46 million stocks representing a 16.1 per cent interest to the latter.
However, the restructuring would trigger a tender offer for the remaining stake and needs a waiver from China Securities Regulatory Commission before it can go ahead.
The announcement follows a statement in March where Deyin said Alibaba intended to invest CNY 4.66 billion to acquire 49.0 per cent of whichever subsidiary will own the 29.9 per cent STO stake.
By extension, the e-commerce powerhouse would have an indirect holding of 14.6 per cent as part of a logistics technology, express terminal and new retail network cooperation agreement with the listed courier.
STO Express recorded a 37.7 per cent hike in profit for the full year to 31st December 2018 due to the robust, albeit, crowded sector, where ZTO, YTO and Yunda rub shoulders with the local logistics arms of Alibaba or JD.com.
The company generated net profit of CNY 2.05 billion on revenue of CNY 17.00 billion and handled 5.10 billion parcels over the 12 months.
According to State Post Bureau, China’s express delivery firms handled 50.71 billion parcels in 2018, up 26.6 per cent year-on-year, and the country is one of the world’s largest courier markets globally.
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