Grand Group Investment PLC Further Investment (9124K)
April 22 2015 - 2:00AM
UK Regulatory
TIDMGIPO
RNS Number : 9124K
Grand Group Investment PLC
22 April 2015
Press Release 22 April 2015
Grand Group Investment PLC
("Grand Group", the "Company" or the "Group")
Further Investment
Grand Group Investment PLC (AIM:GIPO), a provider of expansion
capital and value added services to China-based SMEs with high
growth potential, is pleased to announce that it has entered into
an agreement to make a cash investment of RMB 20 million
(approximately GBP 2.16 million) through its newly incorporated
wholly-owned subsidiary Gao Rui De ("WuXi") Cultural Development
Ltd by acquiring a 15 per cent shareholding in WuXi Jin Xun Tong
Technology Limited ("JinXunTong" or "JXT"). The percentage
investment is subject to upwards only adjustment depending on the
profitability of JXT for the financial year 2015. No such
adjustment is currently contemplated.
JinXunTong is an online learning solutions provider to China's
urban and rural vocational education industry that was incorporated
in 2010 in WuXi City, China. It operates an integrated online
training website Gong Yuan Wang (http://www.gongyuannet.com/),
which provides online training video courses for industrial
workers. Gong Yuan Wang has developed an advanced data centre that
is supported by one of China Telecom's three five-star internet
data centres. This advanced dedicated line for connectivity ensures
the stability of the system, speed of the website and security of
the data. The website currently has approximately four million
registered members, of which approximately two million are paying
members who have already paid total membership fees of
approximately RMB 200 million.
JXT's unaudited results for its year ended 31 December 2014
showed profits after tax of RMB 22.6 million (approximately GBP
2.45 million) (2013: net loss of RMB 0.30 million) on total revenue
of RMB 40.9 million (approximately GBP 4.43 million) (2013 Nil).
Unaudited net assets at 31 December 2014 were RMB 23.0 million
(approximately GBP 2.49 million). Trading in the first quarter of
2015, based on unaudited management accounts, showed profit after
tax of RMB 25.5 million (approximately GBP 2.76 million) on total
revenues of RMB 40.7 million (approximately GBP 4.4 million).
Unaudited net assets at 31 March 2015 were RMB 88. 6 million
(approximately GBP 9.57 million).
Along with Grand's cash investment, Grand's 33 per cent initial
investee company Wuxi Victory Media & Culture Co., Limited
("Victory") has vended certain assets, licenses and expertise
related to courseware development into JXT in return for an 18 per
cent shareholding of JXT. (Victory specialises in the development
of traditional, "offline" courseware for the training of industrial
workers. Assets sold into JXT include vocational training and the
recruiting information website "Kaigongla".) JXT and Victory will
work closely together to develop vocational educational
technology.
JXT is Grand's second investment in education technology related
businesses in China, which is an area where the Directors continue
to see significant potential for growth and the enhancement of
shareholder value.
James Newman, Non-Executive Chairman of Grand Group Investment
PLC, said: "The Board is pleased to announce Grand Group's
investment in JXT, following the Group's involvement in Victory
Group, a vocational training software and videos provider for the
metallurgy sector. The demand for skilled labour in China
represents strong potential for training providers, particularly
those which could cater their offering for the expanding online
audience. We are particularly pleased with the close fit between
our first two investments, allowing them to contribute to each
other's growth. Coupled with the active involvement of Grand Group,
the Board is confident in the long term prospects for JXT.
"The Board is pleased that Grand Group has started to deliver in
key areas of our commitment to shareholders set out at the time of
the IPO. As an active investor based in China, having strong access
to university research facilities and extensive industry contacts,
Grand Group is well-positioned to benefit from the high growth
technology sector in China."
- Ends -
For further information:
Grand Group Investment PLC
James Newman, Non-Executive Tel: +44 (0) 20
Chairman 7398 7710
www.grandgroupplc.com
ZAI Corporate Finance Limited
Ray Zimmerman / Ivy Wang (Nomad) Tel: +44 (0) 20
7060 2220
Steven Baird (Broker) www.zaicf.com
Media enquiries:
Abchurch
Henry Harrison-Topham / Quincy Tel: +44 (0) 20
Allan 7398 7710
grand@abchurch-group.com www.abchurch-group.com
Notes to editors
About Grand Group
The Grand Group was founded in 2014 by Yang Xiao and other
founding shareholders. The Company has been established for the
purpose of identifying, acquiring and investing in small to
medium-sized companies with high growth potential, principally
operating in the People's Republic of China ("PRC").
Grand is a late stage incubator which focusses on investing in
established businesses with either technology or intellectual
property which the Board believes will benefit from Grand's
university research resources.
Partnerships
The TKK Society has fostered and maintained a broad network of
contacts with individuals at local and international higher
education institutions, including: Jiangnan University; Xiamen
University; Jimei University; NanYang Technological University
(China); University of California Berkeley (Tan Kah Kee Hall);
National University of Singapore; University of Hong Kong; Oxford
Brookes University; Keuka College (New York State); and the
University of Greenwich.
Amongst these universities, Grand has already established
effective relationships with Jiangnan University and Jimei
University for its current projects and the Directors believe that
similar relationships can be developed with other universities.
Investments - Victory
Victory produces vocational training software, and most
importantly training videos for basic blue collar jobs, primarily
in the metal working (known in China as the "metallurgy") sector.
Victory works in a field which represents one of the fundamental
social problems in the PRC today: that of unskilled labour
migration from the countryside to urban areas.
Upon completion of the pre-IPO reorganisation, Grand acquired
33% of Victory from Shenzhen Grand, which had previously made an
investment of RMB 196 million in cash into Victory. As at 30 June
2014, the fair value of the Company's investment in Victory
remained RMB 196 million. The Directors understand Victory is
targeting a flotation within the next two years.
For further information, please visit www.grandgroupplc.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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