GUANGZHOU, China, July 1, 2011-- 7
Days Group Holdings Limited (NYSE: SVN) ("7 Days" or the "Company"), a
leading economy hotel chain based in China, announced today that it has
entered into a definitive agreement on July 1, 2011 (the "Agreement")
with Huatian Hotel Group Co. Ltd. ("Huatian Group"), a large hotel
group incorporated in the PRC whose shares are listed on the Shenzhen
stock Exchange (Stock Code: 000428), to acquire 100% ownership of Hunan
Huatian Star Hotel Management Limited ("Huatian Star") (the
"Transaction").
Pursuant to the Agreement, 7 Days agreed to acquire 100% ownership of
Huatian Star for a total of RMB136 million (approximately US$21
million) in cash. Huatian Star has economy hotel operations in 12
cities in China including Changsha, Wuhan, and Zhengzhou, with 21
leased-and-operated hotels in prime locations and a total of 2,682
rooms, all of which are to be acquired by 7 Days upon completion of the
Transaction.
The Transaction has been approved by the Boards of Directors of 7 Days
and Huatian Group and the shareholders of Huatian Star, and is subject
to customary closing conditions and regulatory approvals.
7 Days believes the Transaction will help to further expand its
presence in the 12 cities which Huatian Star currently has operations
and to enhance the Company's market share in those local markets.
Upon completion of the acquisition, the Company intends to rebrand the
21 hotels currently operated by Huatian Star under the 7 Days' brand
name, and to integrate these hotels into the Company's hotel operating
system supported by its leading IT system for these hotels to better
utilize the Company's existing membership base.
Mr. Alex Nanyan Zheng, 7 Days Group's Chief Executive Officer and
Director, commented, "We are pleased to announce the acquisition of the
Huatian Star hotel chain, a strategic step to broaden and deepen our
geographical footprint. We have consistently focused on executing
a rapid expansion strategy and we are confident that our strong organic
growth will allow us to remain among the largest single brand economy
hotel chains in China. Meanwhile, we are always looking for potential
acquisition opportunities that complement our strategy and allow us to
gain scale in specific geographic regions. Going forward, we will
continue to stick to our single brand strategy as we rapidly expand our
scale of operations, and we are confident in our ability to develop 7
Days into the leading economy hotel brand in China."
About 7 Days Group Holdings
Limited
7 Days Group is a leading and fast growing national economy hotel chain
based in China. It converts and operates limited service economy hotels
across major metropolitan areas in China under its award-winning "7
Days Inn" brand. The Company strives to offer consistent and
high-quality accommodations and services primarily to the growing
population of value conscious business and leisure travelers who demand
affordable, clean, comfortable, convenient and safe lodging, and to
respond to its guests' needs.
Safe Harbor Statement under the
Private Securities Litigation Reform Act of 1995
Statements in this release contain "forward-looking" statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These forward-looking
statements can be identified by terminology such as "will," "expects,"
"anticipates," "intends," "future," "intends," "plans," "believes,"
"estimates," "confident" and similar statements. Statements that are
not historical facts, including statements about 7 Days' beliefs and
expectations, are forward-looking. These statements include, among
others, statements regarding the acquisition of Huatian Star, the
increases in the Company's presence and market share in cities which
Huatian Star currently operates, the integration of the Huatian Star
hotels to be acquired, the Company's view on the consolidation trend in
the economy hotel industry in China, current stage of development
future acquisition opportunities of the Company and the growth
strategies of the Company. Actual results may vary considerably; the
substantive terms of the transaction may differ from those as currently
proposed and may not generate any anticipated benefits. In addition, 7
Days' industry is highly competitive and it faces a number of risks and
uncertainties, including those outlined under "Risk Factors" beginning
on page 7 of the Company's annual report on Form 20-F filed with the
Securities and Exchange Commission on May 4, 2011. All information
included in this press release is as of the date of this press release,
and 7 Days undertakes no duty to update such information, except as
required under applicable law.