Clothing Industry Is Not Easy To Do, China'S Top Suit Leader Smashed More Than 3000 Chain Drugstores With 1.5 Billion Plates

Hubei Meierya Co., Ltd. (hereinafter referred to as "Meierya"), which has won the "China clothing annual award - Quality Award", announced in the evening of July 10 that the company intends to purchase 3111.3 million shares of Zhongyou shares by issuing shares and paying cash. As of the signing date of the plan, Zhongyou Co., Ltd. is in the process of capital increase. After the completion of capital increase, the total share capital of Zhongyou will be changed to 6222.6 million shares. After the completion of the transaction, the company will hold 50% of the total share capital of Zhongyou after capital increase, and Zhongyou will become the holding subsidiary of Meierya.

According to the announcement, Zhongyou's asset valuation is tentatively set at 1.5 billion yuan, including cash consideration of 850 million yuan and share consideration of 650 million yuan. Meanwhile, Meierya plans to increase its capital from Shanghai Zhixin, which is controlled by the company's actual controller, with supporting fund-raising no more than 400 million yuan.

Zhongyou Co., Ltd., whose full name is Gansu Zhongyou Health Management Group Co., Ltd., was established on March 28, 2002. It is mainly engaged in drug chain retail business. It has more than 3000 chain pharmacies in Gansu, Shaanxi, Qinghai and other provinces, autonomous regions and municipalities directly under the central government, which is a large-scale pharmaceutical chain operation enterprise.

After the completion of the transaction, Xie Zhikun's equity proportion in the listed company jointly held by Meier group and Shanghai Chixin will be increased from 20.39% to 26.59%, and he will remain the actual controller of Meierya.

According to the asset purchase framework agreement signed by the listed company and the compensation obligatory party, the compensation obligatory party undertakes that the net profits attributable to the owners of the parent company after deducting the non recurring income from the consolidated statements of Zhongyou shares in 2020, 2021, 2022, 2023 and 2024 shall not be less than 150 million yuan, 200 million yuan, 250 million yuan, 300 million yuan and 400 million yuan respectively.

According to the public information, the main business of Meierya is the research and development, design, manufacture and sales of clothing, clothing and textiles. Due to the fierce competition in the textile and clothing industry, the existing business growth pressure of listed companies is greater. The net profit from the year of 2019-6.104 million yuan and that of the year of 2017-6.104 million yuan, respectively.

Meierya frankly said that in order to protect the interests of the majority of shareholders and maintain the sustainable and healthy development of the profitability of listed companies, the company decided to carry out this transaction and inject high-quality assets of pharmaceutical retail industry with strong sustainable profitability, which is conducive to safeguarding the interests of the majority of shareholders of listed companies, especially small and medium-sized shareholders.

Meierya said that the transaction will optimize the income structure of listed companies, open up new business growth points for them, promote listed companies to enter the pharmaceutical retail industry with strong profitability and broad development prospects, and enhance the sustainable profitability and development potential of listed companies.

According to the public information, Meierya's main business is the research and development, design, production and sales of clothing and clothing products; the design, development, production and sales of special labor protection articles. Self run and agent import and export of various commodities and technologies.

In recent years, through the adjustment of development strategy and the optimization of product structure and market structure, Meierya has gradually formed a pattern of paying equal attention to processing trade (including processing with supplied materials and processing with imported materials), general trade and independent brand operation. According to the different market and business model, it can be divided into foreign trade production and processing business in foreign market and "Meierya" brand production, processing and sales business in domestic market.

Domestic market "Meierya" brand production, processing and sales business, including brand men's clothing, women's clothing and supporting clothing products. Meierya men's wear mainly includes suits, shirts, sweaters, T-Shirts, overcoats, casual wear and pants. Its products are positioned as medium and high-end men's clothing for business and politics. Among them, "Meierya" suits are the traditional superior products of the company, which are recognized as "China's well-known trademark". It has won the "China clothing annual award - Quality Award", occupying a major position in the company's domestic sales. Secondly, "Meierya" brand women's wear, mainly including professional wear, dress, fashion, casual wear four series, product positioning for professional women, focusing on business fashion women's style.

According to the financial report, due to the negative impact of international trade friction and the overall downward pressure of domestic macro-economy, the operating income of Meierya in 2019 was 447 million yuan, with a year-on-year growth of 6.88%; the net profit attributable to shareholders of listed companies was 39.45 million yuan, with a year-on-year increase of 358.48%. From the perspective of "men's clothing", the main source of "men's clothing revenue" was 1.09 billion yuan, accounting for 1.09% of the total revenue of men's clothing.

In the first quarter of 2020, Meierya achieved a total operating revenue of 72.198 million, a year-on-year decrease of 47.7%; the net profit attributable to the parent was - 1990.05 million, compared with - 3.712 million in the same period of last year, and the loss margin was expanded.

Meierya said that with the slowdown of the overall consumption demand growth of the domestic clothing industry, the number of processing orders in major foreign trade markets also declined. Brand clothing operation and sales business is facing the challenges of direct competition between domestic and foreign high-end brands and new Internet marketing mode. At present, the company still belongs to the relatively traditional production and processing operation mode. Only by strengthening the management of modern marketing mode, actively exploring industrial upgrading, improving modern logistics transformation, and continuously implementing brand strategy, can the enterprise have more competitive advantages in the market.

Meierya will continue to upgrade its brand structure, enhance its brand structure, and continue to promote the development of its brand structure.