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More changes in store ahead of merger
Last Updated(Beijing Time):2006-12-08 12:06
Two of the country's largest supermarket chains are expected to merge as their parent increases efforts to integrate resources to avoid internal competition.

Lianhua Supermarket Holdings Co Ltd and Shanghai Hualian Supermarket Co Ltd, both owned by retail giant Shanghai Bailian Group, are seeking a merger while both of them make changes to their store networks.

Officials at Hong Kong-listed Lianhua said the company would focus on the Yangtze River Delta region including its home market Shanghai in the coming years. The retailer runs more than 3,700 stores, three-quarters of which are in the delta region.

"The company is adjusting its store network to put more focus on the eastern part of China," said Sun Ming, spokesman of Lianhua Supermarket Holdings Co Ltd.

"An ultimate merger with Hualian is for sure, but Bailian Group hasn't yet worked out a detailed schedule."

Lianhua posted a half-year sales revenue of 8.35 billion yuan (US$1.06 billion), up 21.19 percent from a year earlier. The retailer said profit through June withdrew four percent year on year to 147.6 million yuan led by fierce competition in the retail sector.

Hualian, the country's second-largest supermarket chain, said it lost 16.97 million yuan in the first half of this year, after gaining 15.04 million yuan a year earlier.
Source:Shanghai Daily 
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