Haidilao considers spinoff listing of overseas business

China’s well-known hotpot restaurant chain Haidilao International is proposing a spin-off and considering listing of its overseas business in Hong Kong. The company said in an announcement on 11 July 2022 that the board of directors of the company are pleased to announce that the company is considering a possible spin-off and distribution in a separate listing of the shares of Super Hi International Holding (Super Hi) on the main board of The Stock Exchange of Hong Kong (the Stock Exchange).

The statement also said that Super Hi and its subsidiaries are principally engaged in the operation of restaurant business outside Greater China (including the mainland China, Hong Kong, Macau and Taiwan). The board is of the view that if the proposed spin-off proceeds, it will be in the interests of the company and its shareholders as a whole as the proposed spin-off will better position the business of Super Hi, and the remaining business of the Group for growth in their respective geographic presences. It will  deliver value enhancing benefits in the long run under a separate standalone listing platform, according to the announcement.

As at the date of the announcement, no application for listing of the shares of Super Hi has been made to the stock exchange and the proposed spin-off has not been materialised. If the proposed spin-off proceeds, the company said it will make further announcements to keep its shareholders and potential investors informed.

This comes after Haidilao announced plans to shut down or suspend the operation of about 300 Haidilao restaurants last year as it faced relatively low customer traffic and unsatisfying results of operation.

On 5 November, the company announced a voluntary business update. In a statement, Haidilao said after reviewing the operating performance of its restaurants, it decided to adjust its restaurant expansion planning decisions, shutting down or suspending the operation of about 300 Haidilao restaurants with relatively low customer traffic and unsatisfying results of operation gradually by 31 December 2021, of which some restaurants will be temporarily closed of no more than two years and resume operation in appropriate times.

Haidilao added that it will not lay off employees and will properly settle the employees of such restaurants within the company. 

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