GL events, the integrated event industry group, has announced the acquisition of a controlling stake in China state-owned CIEC (China International Exhibition Center Group) Union. The acquisition sets the stage for significant inroads by GL events into China's promising exhibition market.
The deal is subject to MOFCOM1 approval and is for 55% of CIEC Union.
CIEC is a subsidiary of CCPIT2, which will retain 39% of the company’s shares while managers will continue to hold 6%.
CIEC Union operates six major exhibitions: Beijing Fabric Wallpaper Expo for wallpaper, curtains and home textiles with gross space of 120,000sqm; a similar exhibition held in Shanghai with gross space of 100,000sqm; Build & Decor held in Beijing for building materials & decorations and interior design with gross space of 140,000 sqm; CIDE, the China International Door Industry Exhibition in Beijing with gross space of 120,000 sqm; Keqiao Wallpaper Expo, completing the market offering in the wallpaper, curtains and wall fabrics segment, held in Shaoxing with gross space of 15,000 sqm; ISH China & CIHE, the jointly-organised China international trade fair for heating, ventilation, air conditioning, sanitation and home comfort systems with gross space of 106,000sqm.
CIEC Union, which has 100 employees, is expected to generate €40m in revenue in 2019 with an operating margin of more than 35%. It has a track record of sustained growth driven by an emerging middle class, rising domestic consumption, rapid urbanisation and the Chinese Government's focus on developing the country’s major economic zones.
GL events says it shares a common strategy with CIEC for developing existing exhibitions in new Chinese cities and regions.
In addition, GL events Live Shenzen (ZZX), based in Shenzen and acquired in January 2019, will be able to develop synergies by proposing event engineering services to exhibitors, exhibition centres and organisers of trade fairs and events.
With this latest acquisition, all GL events’ three businesses will be deployed in China where it is now positioned as an integrated provider of solutions and services for events.
Reflecting the importance of these developments in terms of enterprise value, business growth and future earnings, GL events says it is strengthening the local structure with the appointment of high-level managers to spearhead business development, operational oversight and financial management.