Cash-strapped E-Land Group has decided to sell around 30 percent stake in its subsidiary China E-land Wish, according to industry sources on March 6.
According to sources, the company is currently discussing with some Chinese strategic investors to sell its stake. E-Land is hoping to sell its stake to a local company that has expertise in online retailing business and hopes to receive around 120 billion won (US$106.30 million) through the sale.
“It is true that we are considering selling some stake but the specific amount has not been decided yet. We are also considering securing funds ahead of a potential initial public offering in China as one of our options,” an E-Land spokesperson told The Investor.
The firm expects to sign a deal in the first half of this year.
The Chinese unit currently operates five kids clothing brands. Their combined sales reach over 200 billion won every year on average with over 10 percent operating profit.
It is also part of the group’s efforts to improve its financial stability before turning into a holding firm management structure. Its debt-equity ratio in the third quarter last year dropped to 175.7 percent recently from over 400 percent in 2013.
By Song Seung-hyun (firstname.lastname@example.org)