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Clifford Chance advises Ruentex Group on US$2.88 billion sale of 36.16% stake in Sun Art Retail Group to Alibaba

8 December 2017

Clifford Chance advises Ruentex Group on US$2.88 billion sale of 36.16% stake in Sun Art Retail Group to Alibaba

Leading international law firm Clifford Chance advised Kofu International Limited and Concord Greater China Limited, held by Taiwan-listed Ruentex Group, on their US$2.88 billion (HK$22.4 billion) sale of an aggregate 36.16% direct and indirect interest in Hong Kong-listed Sun Art Retail Group Limited, one of China's largest hypermarket retailers, to Taobao China Holding Limited, a subsidiary of Alibaba Group. The transaction completed on 7 December 2017.

Following the transaction, Ruentex will retain a minority indirect interest of 4.67%. Taobao China will also make a mandatory cash offer for the shares of Sun Art that it does not hold or has agreed to acquire.

In addition, Hangzhou Alibaba Zetai Information Technology Company Limited (being the direct wholly-owned subsidiary of Alibaba Group) will enter into a business cooperation agreement with Sun Art to provide services including granting access by the stores operated by Sun Art Group to its business model and online platform; data sharing; and integration of systems and POS hardware as part of its 'Taobao Daojia' service offering to the stores operated by the Sun Art Group.

China Co-Managing Partner Terence Foo led on the deal and was supported by Beijing senior associates Seow Tzi-Yang, Janet Jiang and trainee Jiangzhou Lan, working in collaboration with Hong Kong partner Frank Yuen on Takeover Code issues and Hong Kong partner Edith Leung on financing issues.

Ruentex Group is a Taiwanese conglomerate with interests in food retailing, textiles and real estate and is listed on the Taiwan Stock Exchange.

Clifford Chance has recently advised on a number of high profile consumer goods and retail transactions including Shanghai Ground Food Tech on purchase of Australian dairy group Brownes, Mondelēz International, Inc.'s sale of most of its grocery and cheese business in Australia and New Zealand including the iconic vegemite brand to Bega Cheese Limited for AU$460 million. This followed advising the Coca-Cola Company on the signing of definitive agreements relating to the re-alignment of the company's bottling operations in China, with an approximate aggregate value of US$1.4 billion.