XTEP Sports Shoes To Accelerate The Pace Of Expansion To Taiwan Listing

In December 1st, it became the first continental movement to open branches in Taiwan.

In November 29th, XTEP announced that it had submitted an application to the relevant departments of Taiwan, which will sell 250 million Depositary Receipts (TDR) and hopes to be listed in Taiwan.

XTEP said that the approval process of TDR would take 3 months.

It is understood that XTEP intends to issue 250 million units TDR.

On behalf of 0.4 shares per unit of Taiwan depositary receipt, XTEP issued a total of 100 million shares.

These include 50 million new shares issued by the company and Carlyle investment.

XTEP said that the funds raised will be used to develop Taiwan's market business, marketing and sales, as well as expanding plant and equipment.

On the other hand, the issuance of TDR will also help attract overseas and local investors in Taiwan, and expand and decentralization of shareholder base.

XTEP's international share price fell by 7.9% at the end of October this year due to the reduction of 108 million shares by major shareholders.

In June 3, 2008, XTEP was listed on the main board of the stock exchange of Hongkong, and is now one of the constituent stocks of Hongkong's three Hang Seng Composite Index series.

Ye Jianzhong, an international analyst at Bank of communications, said: "the dilution effect of this TDR issue is not great. Because Taiwan business needs growth time, it will not affect XTEP's performance this year."

Zhuang Zhaohui, manager of XTEP overseas division, once told the media: "as early as 2009, we wanted to enter the Taiwan market. After a year's efforts, we opened the gate of Taiwan."

In June this year, XTEP opened its first branch store in Taipei in Taiwan.

Zhuang Zhaohui said that in view of the Taiwan market, XTEP will adopt the regional agent distribution mode and take the middle end price route.

In the first year, 8~10 stores will be opened in Taiwan. The turnover is estimated at 3 million yuan, and the final plan is to open 300 stores in Taiwan.

Reporters learned that, the same as Fujian shoes and clothing enterprises Anta, PEAK, Li Lang, nine Mu Wang and so on are already preparing to set up offices in Taiwan.

PEAK CEO Xu Zhihua has revealed that a number of Taiwan retailers have been negotiating with PEAK about agents and franchisees. If conditions are appropriate, they are willing to try to open shop in Taiwan.

Public information shows that since the opening of Taiwan's mainland investment to Taiwan in 2009, the amount of investment from mainland enterprises to Taiwan has reached US $108 million, of which Fujian enterprises accounted for 70%.

This year, when the framework agreement on cross strait economic cooperation came into effect, it accelerated the pace of land capital.

Among them, shoes and clothing enterprises are particularly keen.

Ye Jianzhong analysis: "Taiwan's local sports brand market is mainly dominated by Adi, Nike and Puma, while there are not many popular localization brands like XTEP, which left market space for mainland sports brands such as XTEP."

Zhuang Zhaohui said that besides the Taiwan market, the mainland shoe and clothing enterprises also value Taiwan's ability to radiate the Southeast Asian market.