IMAGI sets up sales network of “Pleasant Goat and Big Big Wolf” children’s wear

Toon Express will open more than 1,100 outlets in three years to further unleashes growth of branded business.

Toon Express International Limited (“Toon Express”), an indirect wholly owned subsidiary of IMAGI International Holdings Limited (“IMAGI”), said it will initially subscribe for a 20.63% interest in the share capital of Sino Light Enterprise Limited (“SLE”). SLE plans to build a nationwide retail network of “Pleasant Goat and Big Big Wolf” apparel stores for kids.

On 21 December 2010, SLE entered into a licensing agreement with an affiliate of Disney Enterprises, Inc (“Disney”), the master licensee of the “Pleasant Goat and Big Big Wolf” brand, to manufacture and distribute children’s apparel under the brand for kids from 0 - 14 years old for 3 years in mainland China. SLE targets to open over 1,100 “Pleasant Goat and Big Big Wolf” shops in 3 years through the establishment of various types of sales outlets such as flagship stores, shop-in-shops and franchised outlets. SLE plans to build themed flagship stores in Shanghai, Beijing and Guangzhou where customers can experience one-stop service, immerse in the animated world and shop for quality merchandise of the “Pleasant Goat and Big Big Wolf” brand. Inside the flagship stores, children can interact with the mascot characters, play, learn and shop at the same time. The first store is scheduled to open in September 2011.

IMAGI’s chairman Francis Leung Pak To said, “It is always our strategy, as the brand manager, to explore new initiatives to develop our business which includes seeking new channels to promote our brands and cartoon characters. Since the latest baby boom in China which started in 2005, the number of children aged zero to 14 has exceeded 250 million, according to an independent research. With such a large population base of infants and children, it is expected that the children’s wear industry will continue to grow strongly. Through the nationwide retail network and the distribution and sales of the branded products, we expect to unleash further growth potentials of the “Pleasant Goat and Big Big Wolf” brand and boost the core consumer products licensing business of the Group.”

Mr Eric Hung, Chairman of SLE, said, “The partnership with Toon Express is expected to enhance consumers’ exposure to China’s No. 1 local brand --- “Pleasant Goat and Big Big Wolf”. Our vision is to be “the leading local eco-friendly kid apparel brand in China by offering a wide range of casual, high quality and fashionable clothing”. We will promote “Pleasant Goat and Big Big Wolf” as the premium kids apparel brand with a green concept, based on the home village of the characters in the “Green Green Grassland”. We are confident that the retail stores will attract customers who have the strongest purchasing power in mainland China.”

Mr Soh Szu Wei, CEO of IMAGI, said, “The investment enables Toon Express to participate in the retail apparel business under the “Pleasant Goat and Big Big Wolf” brand and to expand the consumer products business. The nationwide retail network would enhance direct interactions of the brand with consumers. By leveraging on the status of “Pleasant Goat and Big Big Wolf” characters as the No 1 animation in China, we believe the Group’s consumer products licensing business will benefit from the fast-growing animated entertainment business and children’s wear market in mainland China.”

IMAGI announced on 13 July that Toon Express has entered into an agreement to acquire a 20.63% interest in SLE for HK$36.4 million, to be satisfied as to HK$9.1 million by cash and the remaining HK$27.3 million by the provision of certain business support services to SLE. Toon Express was granted an option to subscribe an additional 8.95% stake in SLE for HK$22.4 million in cash, which is exercisable on or before 31 August, 2014. Following the completion of the initial subscription and assuming the option is exercised in full, Toon Express will own 29.58% in SLE.