Daigou-focused retailer AuMake is expanding its focus to the lucrative Chinese tourist market with the $14.2 million acquisition of Broadway, which operates eight stores across Australia and New Zealand aimed at Chinese tourists.
The company’s share price dipped 3.5 cents, or 16.67 per cent, to 17.5 cents on the announcement.
AuMake executive chairman Keong Chan said his company was buying an established network of bricks-and-mortar stores that, importantly, feature on the itinerary of many Chinese tour groups that visit Australia.
“Broadway in the Chinese tourism industry are one of the most well known and respected … they are very good at drawing tourists to stores because they have agreements and commissions in place,” Mr Chan told AAP.
Mr Chan said the acquisition followed a $7 million capital raising, which was heavily oversubscribed.
“At the moment 30 per cent of our sales are online through WeChat,” Mr Chan said.
In February the company announced it had halved its losses after more than doubling its sales in the space of a year, with its internal sales forecast upgraded 30 to 40 per cent in March after it flagged the expansion of its stores.