MSPEA to exit Chinese convenience store chain Hi-24

Hong Kong-listed property management company Greentown Service Group and China-based online food retailers Xianlife and Yiguo – both of which have received VC and PE funding – have formed a joint venture, called China CVS, to acquire the business.

Hi-24 operates 300 stores in Beijing under the Hao Lin Ju brand. MSPEA acquired a majority stake in the company from China Financial Services Holdings in 2012 for an undisclosed sum. 

Xianlife will own 50% of Hi-24 following the transaction, Xin Xiao, Xianlife’s founder and CEO, told local media. Greentown and ExFresh - Yiguo's cold-chain logistics subsidiary - will hold 35% and 15%, respectively.

Greentown said in a filing that Hi-24 “represents an attractive opportunity for investors with stable cash flows and growth prospects.” The JV will look to combine Hi-24's traditional and mature business operation with the new retail model pursued by Xianlife and Yiguo. This will include using technology to improve supply chain efficiency and user experience.

Established in 2014, Xianlife sells imported snacks and lifestyle products through its e-commerce platform. The company raised a Series A round from Bertelsmann Asia Investments and CDH Investments in 2015, and an extended Series A round from investors including Cherubic Ventures in January. Xianlife, which already has three physical stores in Hangzhou, formed a strategic partnership with Greentown in April to accelerate offline expansion.

Yiguo, which was founded in 2015, sells seafood and fruit online sourced from China and overseas. Alibaba Group and Yunfeng Capital were the early investors in the company. Last year, it raised a Series C round of more than $500 million across two tranches from investors including KKR and domestic home appliance retailer Suning Commerce Group. Two months ago, Alibaba’s B2C e-commerce unit Tmall led a $300 million Series D round.

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• Topics
• Greater China
• Trade sale
• Consumer
• China
• Morgan Stanley Private Equity Asia
• TMT