Baby-friendly room acquired Shanghai Zhiyile for 55 million yuan to expand the retail and online layout of infant toys

On the evening of May 29th, in view of the relatively scattered sales of infant toys in China, the brand concentration has yet to be improved, and Japan’s TOYROYAL royal toy market has a relatively large development space. Baby-friendly Room (603214) issued an announcement that the company recently signed the 'Equity Transfer Agreement on Shanghai Zhiyile Trading Co., Ltd.' with Shanghai Nuoxi Management Consulting Partnership (Limited Partnership), Xiong Guiying, and Lin Meihui. The company plans to acquire Shanghai Zhiyi Le Trading Co., Ltd. (hereinafter referred to as the target company) has 100% equity, and the consideration for this transaction is 55 million yuan. After the completion of this equity transfer, the company will hold 100% of the equity of the target company, that is, the target company will become a wholly-owned subsidiary of the company. According to the data, the target company’s main business is the exclusive sales agency of Japan’s TOYROYAL Royal Toys in mainland China, and has an indefinite period of brand agency and intellectual property licenses for Royal Toys. Its business covers 46 cities in China and its sales channels have parent companies. Baby products stores, department stores, supermarket systems and various online platforms (official flagship stores, franchised stores, Taobao C store, JD.com, koala shopping, Amazon, etc.). Aiyingshi said that the company's core consumer groups are highly matched with the target customer groups of Japan's TOYROYAL Royal Toys, which can produce direct synergies. China's 0-3 year old toy market has not yet formed a major brand focusing on infant toys, sales are relatively scattered, and brand concentration has yet to be improved. Japan's TOYROYAL royal toy market has more room for development. Through the operation of the target company, the Japanese TOYROYAL Royal Toys has established and accumulated a certain brand influence in the domestic maternal and child channels and e-commerce channels. After the completion of this acquisition, it will improve the company’s competitiveness in the toy category and expand the company. Online sales channels. Baby-friendly room disclosed that in terms of performance commitments, Lin Meihui, the actual controller of the target company, promised to the company: the target company’s net profit after tax in 2020 will not be less than 3.5 million yuan; the net profit after tax in 2021 will not be less than 4.2 million yuan; and the net after-tax profit in 2022 The profit is not less than 5.04 million yuan. If the target company fails to complete the above-mentioned performance commitment indicators, it shall compensate the target company in cash for the three-year cumulative actual net profit less than the three-year cumulative performance commitment target. The amount of compensation u003d the three-year cumulative committed net profit-the three-year cumulative actual Complete net profit. If the above compensation matters are involved, the actual controller shall pay the target company a one-off compensation amount within 15 days after the target company’s 2022 annual audit report is issued. In addition, in terms of the governance of the target company, after the completion of the equity transfer, the listed company, as the controlling shareholder of the target company, has the right to adjust the composition of the target company’s executive directors or board of directors and relevant personnel of the target company. The original actual controller, original shareholders and their assigned personnel of the target company shall actively cooperate with the company to make adjustments. Regarding the impact of this investment on the listed company, Aiyingfang said that this transaction is an important measure for the company to expand the toy retail market. It has significant synergies with the existing business model, meets the company's strategic development direction and actual business needs, and can strengthen the company The penetration rate of toys for 0-3 years old can improve the competitiveness of toy categories; the target company can expand and improve online channels, establish a complete online operation team of the company, and prepare for the layout of more brands in the future.