Acquisition

17 Mar 2009 07:00

For Immediate Release 17 March 2009

ET-CHINA.COM INTERNATIONAL HOLDINGS LIMITED

("Et-china", "the Group" or "the Company")

Et-china strengthens online presence with acquisition of Yoee.com Ltd

Yoee.com was founded in 2003 by Justin Xiong, chief executive, and the Beijing Foreign Enterprise Air Service Ltd, the biggest airline ticketing consolidator in China, and is now one of the leading online travel brands in North China. Yoee.com was the first company in China to provide real-time online search and booking services for both domestic and international air travel. Yoee.com is primarily engaged in the sale of air tickets, hotel rooms, insurance and package tours to frequent independent travellers through its web site and 24 hour call centre.

Et-china's Directors believe that the acquisition has compelling strategic and financial benefits for both companies. The combined entity will consolidate Et-china's online travel division as a top 3 player nationwide and significantly increase the Group's product, distribution and service capabilities across the whole of China in the fast growing frequent independent travellers (FIT) market.  The acquisition of Yoee.com will transform the focus of Et-china's FIT operation from solely South China to a truly national operation.

Following the acquisition, Yoee.com's key management, including Mr. Justin Xiong, will relocate from Beijing to Guangzhou. Mr. Xiong is a highly successful Internet entrepreneur, co-founding a retail website, Joyo.com and growing it to become China's largest retailer of books, music and videos before it was acquired by Amazon.com in 2004. After the sale of Joyo.com, Justin has successfully grown Yoee.com into one of the leading online travel companies in North China with limited funding. In his new role as COO of Et-china's FIT business, Mr. Xiong will be responsible for developing Et-china's fast growing FIT business allowing the Group's CEO, Matthew Ng, more time to pursue strategic initiatives.

For the year ended 31 December 2007, Yoee.com reported a gross profit of RMB 8.7 million and a loss before tax of RMB 2.9 million on revenue of RMB 13.7 million. 

Matthew Ng, Et-china's President and Chief Executive Officer, commented: "I am delighted that we have reached agreement to combine Et-china and Yoee.com to create an enlarged group which is strongly placed to take advantage of the tremendous opportunities in the fast growing Chinese travel industry. This is an industry transforming event, as this acquisition marks a step change in the scale of Et-china's FIT business."

"Our frequent independent travel operations will benefit significantly from Yoee.com's strong online customer base and the dynamic leadership of Justin, while Yoee.com will gain from Et-china's scalable technology platform. The complementary strengths of both companies will allow the enlarged Group to further expand the reach and scope of our travel services and products as well as our customer base.  This first acquisition of Et-china since its IPO marks a significant stage in the Company's progressive growth into the FIT segment of the travel market."

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