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[HONG KONG, 24 August 2004] A.S. Watson (ASW), the retail and manufacturing division of Hutchison Whampoa Limited (HWL), today announced its purchase of a 40 per cent stake in Dirk Rossmann GmbH, a German health and beauty retail chain.
Rossmann was founded in 1972 by Dirk Rossmann who has developed the company into a network of over 1,100 stores in Germany, Poland, Hungary and the Czech Republic. In its home country Germany where it has 786 stores, Rossmann is one of the top three players in the health and beauty retail market and a very established name in the community.
Commenting on the purchase, ASW Group Managing Director Ian Wade said,
"A.S. Watson decided to purchase a stake in Rossmann Germany because the market prospects are exceptional. Germany is the largest health & beauty market in Europe, and offers huge potential for further development.
The Group's strategic aim is to expand its footprint in Europe, hence the option to invest in Germany offers an excellent opportunity for us.
We have enjoyed a tremendous business relationship with Rossmann over the past two years in Central Europe. We believe this acquisition will reinforce the synergetic links between A.S. Watson's European operations and Rossmann."
The acquisition of Kruidvat Group in 2002 brought to ASW a network of Rossmann stores in Central Europe - Poland, Hungary and the Czech Republic - on a 50/50 joint venture basis. From the same deal, ASW has the opportunity to purchase 40 per cent of the Rossmann's German operation from the former Kruidvat owner the De Rijcke family, to be exercised within 24 months (until October 2004).
Following the acquisition, Rossmann will maintain its management over day-to-day operations in Germany while ASW has representation on the board and contribute to all strategic decisions.
Dirk Rossmann, founder of Rossmann said ASW's investment will strengthen Rossmann's financial backing and its competitiveness. ASW's international retail and purchasing network will also add value to the company.
The deal received clearance from the European Commission on 20 August 2004.
About A.S. Watson
A.S. Watson (ASW) is one of the oldest and best-known trading names originating in Asia. With a history dating back to 1828, ASW has evolved into a truly international retail and manufacturing business with operations in 19 markets across Asia and Europe.
In Europe, A.S. Watson' s retail network comprises of seven health & beauty retail brands - Kruidvat, Trekpleister, ICI PARIS XL, Rossmann, Superdrug, Savers and Drogas.
A wholly-owned subsidiary of Hong Kong-based conglomerate Hutchison Whampoa Limited, ASW operates 13 retail brands with over 4,500 stores spanning from health & beauty chains to its food, electronics & general merchandise, and airport retail arms. It is also an established player in the beverage industry, ASW provides a full range of beverages from bottled water, fruit juices, soft drinks and tea products to some of the world's finest wine labels via its international wine wholesaling and distribution network. ASW employs over 64,000 people and in 2003, its reported turnover was HKD 63 billion (approx. USD 8 billion).
About Rossmann
Rossmann was founded in 1972 by Dirk Rossmann who opened the first health & beauty shop in Hanover. He was the first person in Germany to introduce the discount health & beauty concept and it was an immediate success. In less than a decade, Rossmann developed into the market leader in northern Germany with 100 stores.
After the borders between East and West Europe were opened in the early 1990s, Rossmann started the Central Europe operation in Poland and thereafter expanded into Hungary and the Czech Republic.
The early days were a formidable challenge in countries that had just emerged from a communist system that stifled initiative. Even the training of store employees was a major undertaking. Realising the advantages of working with a strong and established partner, Rossmann in 1996 decided to share the expansion in Central Europe with the Dutch-based Kruidvat Group. The Kruidvat Group was later acquired by A.S. Watson in 2002.
In just a few short years, the stores have become impeccable retail environments staffed by well-trained employees and stocked with a luxurious assortment of products. With an emphasis on personal care products, Rossmann own-brand products hold an important position within the range.
Today, Rossmann has over 1,100 stores in Germany, Poland, Hungary and Czech Republic.
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