ChinaNet Online Holdings Acquires 2 Advertising Agencies
February 10 2011 - 7:30AM
ChinaNet Online Holdings, Inc. ("ChinaNet"), (Nasdaq:CNET), a
leading full-service B2B media development, and internet technology
company for small and medium-sized enterprises ("SMEs") in the
People's Republic of China, today announced that it has purchased
two privately held advertising agencies for a combined purchase
price of approximately $2.5 million, with an estimated payback of
approximately three years.
Quanzhou Zhiyuan Marketing Planning Co., Ltd. and Quanzhou
Tianxi Shunhe Advertising Co., Ltd. are both independent
advertising companies based in Fujian province which provide
comprehensive branding and marketing services to over 50 small to
medium sized companies focused mainly in the sportswear and
clothing industry, including 10 recognized branded clients and
numerous mid to high-end producers. ChinaNet expects to generate
approximately $80,000 to $100,000 in revenues annually for each
branded client.
Branded clients include the following:
ZD Sports – One of China's top retailers of name brand sporting
goods and accessories.
http://www.zdsports.com/
China Flyke – Established in 1998, China Flyke is a branded
sports shoe manufacturer and distributor.
http://www.chinaflyke.com/index.html#index
Xidelang - Retailer of name brand clothing and accessories.
http://www.xidelang.com/
Kangta - One of China's top retailers of name brand sporting
goods and accessories.
http://www.kangta.cn/brand/index.asp
Ming-Zu – Retailer of younger generation sportsware, shoes and
accessories
http://www.ming-zu.com/new/default.htm
With the addition of these two acquisitions, ChinaNet will now
be able to provide an integrated online suite of marketing
services, including Internet-based advertising and branding, search
engine optimization ("SEO"), and targeted marketing. In addition,
ChinaNet will offer franchise marketing for select customers
through a revenue share model on its www.28.com portal.
"These acquisitions bring several immediate benefits to ChinaNet
including an entry into the Fujian Province and a base of fast
growing SME's, including several marquee names. More importantly,
having a complete suite of marketing and franchise promotion
services allows us to expand our market opportunity from 8,000
franchise customers to over 6 million franchises, dealerships and
merchants looking to expand their businesses domestically in China.
One of our key goals for 2011 is to expand our base of mid-to-high
profile branded customers, which currently stands at 40 out of a
total of 1,000 customers. During the next few years we expect
branded companies to become 25% of total customers, which will
enable us to more adequately leverage our entire suite of web based
tools, while significantly increasing the average revenue per
customer," said Mr. Handong Cheng, Chairman and CEO of ChinaNet.
"As a business partner, we help our clients grow in size and scope,
and become more efficient and profitable. As we continue to improve
our value proposition and grow our customer base, we will drive
incremental higher margin revenue through our business."
About ChinaNet Online Holdings, Inc.
The Company, a parent company of ChinaNet Online Media Group
Ltd., incorporated in the BVI ("ChinaNet"), is a leading
full-service B2B media development, and internet technology company
providing online advertising, marketing and brand management
solutions for small and medium-sized enterprises (SMEs) in China.
The Company, through certain contractual arrangements with
operating companies in the PRC, provides Internet advertising and
other services for Chinese SMEs via its portal website 28.com, TV
commercials and program production via China-Net TV, and in-house
LCD advertising on banking kiosks targeting Chinese banking
patrons. Website: http://www.chinanet-online.com .
Safe Harbor
Statement This release contains certain
"forward-looking statements" relating to the business of ChinaNet
Online Holdings, Inc., which can be identified by the use of
forward-looking terminology such as "believes," "expects,"
"anticipates," "estimates" or similar expressions. Such
forward-looking statements involve known and unknown risks and
uncertainties, including business uncertainties relating to
government regulation of our industry, market demand, reliance on
key personnel, future capital requirements, competition in general
and other factors that may cause actual results to be materially
different from those described herein as anticipated, believed,
estimated or expected. Certain of these risks and uncertainties are
or will be described in greater detail in our filings with the
Securities and Exchange Commission. These forward-looking
statements are based on ChinaNet's current expectations and beliefs
concerning future developments and their potential effects on the
company. There can be no assurance that future developments
affecting ChinaNet will be those anticipated by ChinaNet. These
forward-looking statements involve a number of risks, uncertainties
(some of which are beyond the control of the Company) or other
assumptions that may cause actual results or performance to be
materially different from those expressed or implied by such
forward-looking statements. ChinaNet undertakes no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except
as may be required under applicable securities laws.
CONTACT: HC International, Inc.
Ted Haberfield
Tel: +1-760-755-2716
Email: thaberfield@hcinternational.net
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