GMAI news (copied from Yahoo)
Monday January 17, 11:31 am Eastern Time
Company Press Release
Greg Manning Auctions' China Subsidiary Leapfrogs Competition to Take Lead in E-Commerce in China
Joint Venture With China's Everbright Technology To Advance
Clicks And Mortar Strategy Of GMAI-Asia.com Through 200
Cellular Telephone Stores In Major Chinese Cities
Greg Manning Auctions, Inc. (NASDAQ NM: GMAI - news) announced today that its China-based subsidiary, GMAI-Asia.com, Inc. has entered into a definitive agreement to manage the leading retail cellular telephone distribution network of China Everbright Technology Company Limited (SEHK: 256), and acquired a 65% equity interest in the network's management and holding company. The remaining 35% interest in the company will continue to be owned by China Everbright Technology.
As part of the agreement, Greg Manning Auctions, Inc. will assume certain liabilities and contribute stock and cash that together have a total value of US $10.4 million. In consideration of this additional investment in GMAI-Asia.com, Greg Manning Auctions, Inc. raised its interest in GMAI-Asia.com from 42.5% to 51.70%.
China Everbright Technology Company, Limited is a Hong Kong listed public company. It is a subsidiary of the China Everbright Group, one of China's leading financial services groups with a wide range of majority interests including China's leading securities firm and the Everbright Bank. China Everbright Group reports directly to China's State Council.
Under the terms of the agreement, GMAI-Asia.com will exclusively manage a retail network of some 200 cellular telephone and electronics stores located in Shanghai, Beijing and other major cities throughout mainland China. Currently, the chain has more than 20% market share in Shanghai and several major cities in East China.
GMAI-Asia.com plans to develop the retail network to serve as e-commerce distribution points and e-commerce service centers with multiple terminals at each location to drive traffic to its proprietary website www.iatoz.com, which is a consumer-to-consumer, business-to-consumer and business-to-business trading platform. Since launching the site on October 15 of last year, www.iatoz.com has registered over 50,000 subscribers and 2,000 merchants offering over 30,000 items for sale or auction ranging from collectibles to consumer electronics, automobiles and real estate properties. Registered consumers can post their own products for sale, as well as look up and buy products from linked merchants.
In announcing the joint venture, Greg Manning, Chairman of Greg Manning Auctions, Inc. and GMAI-Asia.com, Inc. said, ``Through the combination of our Internet trading platform with Everbright's physical network, we immediately catapult GMAI-Asia.com to what we believe to be China's number one e-commerce company. We now possess a forward looking clicks and mortar strategy, which solves the significant barriers to entry in the China market regarding payment and delivery issues, problems faced by all e-commerce companies in China. More importantly, we view this joint venture as the first of many initiatives we will undertake in the China market, particularly with our new partner Everbright.'
Everbright's retail network was founded in 1998 and had reported sales of approximately US $40 million in 1999. It has sold over 300,000 cellular handsets and has over 50,000 active consumer service contracts. The retail chain distributes all major brand name cellular handsets, provides service contracts from China Telecom and China Unicom as well as IP phone cards. Through the joint venture, the retail chain will immediately expand its products lines by virtue of GMAI-Asia.com's online shops and merchants. GMAI-Asia.com is projecting US $20 million in online sales for 2000 as a result of the joint venture. The retail network began selling cellular handsets exclusively over www.iatoz.com on January 1, 2000.
Mr. J.P. Wang, Chief Executive Officer of GMAI-Asia.com said, ``The Everbright joint venture is an important component of our overall strategy of creating China's leading e-commerce company with consumer-to-consumer and business-to-consumer opportunities. To that end, it is our intention to leverage the retail network's physical infrastructure to rapidly build the www.iatoz.com brand name. We also intend to establish a comprehensive logistics and fulfillment program that takes into account the realities of China today and in the future. The joint venture provides the platform to facilitate our plan to aggressively target business-to-business opportunities through our online merchant network and various electronic and communications products distribution opportunities inherent in the retail network.'
Mr. Chen Dagang, Chief Executive Officer of China Everbright Technology, believes that the formation of the joint venture brings several critical elements together. He said, ``The Internet experience and technology of GMAI-Asia.com and Greg Manning Auctions, Inc. are a formidable alliance with the cellular telephone sales centers and significant customer base established by Everbright Technology. We selected GMAI as our partner because of their excellent reputation and superb management team in China. The conversion of our bricks and mortar stores into Internet sales and service centers admirably reinforces our own e-commerce strategy which is firmly supported by our parent company's position and prestige as a financial services conglomerate.' About Greg Manning Auctions, Inc.
Greg Manning Auctions, Inc. is a global leader in the on-line auctions and on-line retail sale of collectibles. Through its operations in the United States (www.gregmanning.com and www.teletrade.com), in China (www.iatoz.com) and in Europe (www.gmai-europe.com), the company offers one of the richest reservoirs of collectibles in the world, including stamps, coins, sports memorabilia, sports cards, rock `n roll memorabilia, movie posters, diamonds, comics and fine art.
Statements in this press release that relate to future plans, objectives, expectations, performance, events and the like are ``forward-looking statements' within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934. Future events, risks and uncertainties, individually or in the aggregate, could cause actual results to differ materially from those expressed or implied in these statements. Those factors include the parties' abilities to develop, implement, integrate, and launch the services and offerings described herein, and other factors discussed in the ``forward-looking information' or ``risk factors' sections included in the companies' prospectuses, quarterly reports on Form 10-Q, and annual reports on Form 10-K
This release and prior releases are available on the KCSA Public Relations Worldwide website at www.kcsa.com.
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