Tarsus drives joint venture with Chinese exhibition organiser

Thursday, Apr 26 2012 by
Tarsus drives joint venture with Chinese exhibition organiser

Business-to-business media group Tarsus (LON:TRS) has agreed the terms of an £11.2 million deal to buy a 50 percent stake in a Chinese trade fair for the automotive aftermarket.

The joint venture involves the China International Automotive Aftermarket Industry and Tuning (Guangzhou) Trade Fair (GZ Auto) and other associated business assets. It gives Tarsus exposure to the rapidly growing automotive industry in China, which overtook the US in 2009 as the largest consumer of new automobiles.

The deal is also a boost to Tarsus’ medium term strategy to derive 50 percent of its revenues from Emerging Markets by 2013. In March, the company reported record annual results, with revenues up by 42 percent to £67.1 million and adjusted pre-tax profits up by 77 percent to £16.8 million. Emerging Markets revenues contributed 38 percent of the group total and the group has since acquired a 70 percent stake in leading Turkish exhibition organiser Lifemedia Fuarcilik A.S.

The latest joint venture is subject to regulatory approval in China and certain other conditions, with completion expected within the next three months. Once the deal goes unconditional, Tarsus will pay approximately RMB72 million (equal to approximately £7.2 million) in 2012, with the remaining sum payable in 2013 and 2014, subject to the achievement of certain profit targets related to future performance. The transaction will be funded from the group’s existing cash resources and available bank facilities.

GZ Auto, a leading business to business automotive aftermarket exhibition held annually in China, is strategically located in Guangzhou, a recognised manufacturing and trading hub with excellent links to the rest of China, Hong Kong and South East Asia. The February 2012 iteration of GZ Auto was the eighth edition of the event organised by Jiuzhou Media and attracted c.1200 exhibitors occupying c.60,000 net square metres. The main exhibitor sectors are: car audio and electronic equipment, interior and exterior decoration, modification and car care products and auto parts. Visitors are predominantly auto retailers and wholesalers.

Douglas Emslie, the managing director of Tarsus, said: "This transaction is a further important step towards achieving our Project 50/13 objective of deriving half our revenues from emerging markets in 2013, following the Life Media deal in Turkey announced in March. GZ Auto is an excellent fit with our strategic objectives of expanding our business in emerging markets and in a market sector that is in transition.…

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Tarsus Group plc is an integrated media group primarily engaged in exhibitions, along with associated conferences, publishing, education and Internet activities. The principal activity of the Company is the holding of investments. The Company operates through three segments: EMEA, Americas, and Asia. The main activities of all segments are the production of exhibitions supported by other media activities related to those exhibitions. Its key brands include the Dubai Airshow, Labelexpo, OFFPRICE, Zuchex, AAITF and Tarsus Medical. more »

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