This means that Xiangyuan Holdings, China's largest investor and operator of mountain scenic areas, and Haichang Ocean Park, China's largest operator of ocean-themed parks, will combine. This is the most significant change in the field of listed Chinese cultural tourism companies since the beginning of this century. This will not only have a huge impact on both parties, but will also profoundly affect the future development of China's cultural tourism industry. Next, the author will reveal the significance of this "century transaction" through several Q&As. Why is this transaction the most significant change for listed Chinese cultural tourism companies this century?

Answer:

First, Xiangyuan Holdings has been continuously 7 years rated as a "Strong Chinese Tourism Group" 20 Haichang Ocean Park has also 11 times been rated as a "Strong Chinese Tourism Group" 20 Strong". Now, two "Strong Chinese Tourism Groups" 20 are together, which has never happened before.

Second, Xiangyuan Holdings' A listed company Xiangyuan Culture and Tourism (600576.SH) market value 107 billion yuan ( 6 month 2 day) ，The Hong Kong-listed company Haichang Ocean Park ( 02255.HK ) also has a market value in the tens of billions of yuan. Due to debt problems in the past year, expectations have been weak, and the market value has fallen to 74 billion yuan ( 6 month 2 day) . Xiangyuan Holdings will simultaneously control two cultural tourism listed companies with a market value of tens of billions of yuan, which has never happened before.

Xiangyuan Holdings also has an infrastructure construction listed company Jiaojian Shares (603815.SH) ， At that time, it will have as many as three listed companies, owning A A-shares and Hong Kong stocks, two major financing windows.

Third, Xiangyuan Holdings is the "King of Mountains" in China's cultural tourism industry, with many mountain-type scenic areas and resort projects, including Qiyun Mountain, Huangshan Mountain, Zhangjiajie, Danxia Mountain, Bifengxia, Mangshan, and Wolong Shenshuping. Haichang Ocean Park is China's number one and the world's number two (by market capitalization) operator of ocean-themed parks, known as the "Ocean Overlord." It operates 7 ocean-themed park projects in Shanghai, Dalian, and Sanya, and is preparing several new projects in Beijing, Fuzhou, and Saudi Arabia in the form of light asset output. The two overlords in different cultural tourism sectors are now or will soon be joining forces, which is unprecedented in the history of tourism development in China.

Shanghai Haichang Ocean Park Image source: Haichang Ocean Park official website

Why did Haichang Ocean Park's original controlling shareholder give up its controlling stake?

First, In fact, Haichang Ocean Park's products, brands, and teams are all very high-quality. Before the COVID-19 epidemic, Haichang Ocean Park successively invested in several large projects in Shanghai, Sanya, and other places. The three years of the epidemic brought huge debt pressure. This time, Xiangyuan Holdings invested HK$ 22.95 billion in Haichang Ocean Park through capital increase and share expansion, which will greatly alleviate its debt problems and help it lighten its load.

Why did Haichang Ocean Park choose Xiangyuan Holdings?

First, Haichang Ocean Park's assets are very attractive. As far as I understand, there were many players involved in this acquisition. Haichang Ocean Park's final choice of Xiangyuan Holdings was made after careful consideration. The most important reason is that Xiangyuan Holdings has both the willingness and the ability to manage cultural tourism businesses, including theme parks. Xiangyuan Holdings entered the cultural tourism field 17 years ago, and has always maintained a firm and pragmatic, accumulating attitude, accumulating "investment, research, construction, and operation" four-in-one full-chain capabilities. Now these accumulations are bearing fruit, and the cultural tourism industry generally recognizes Xiangyuan Holdings' capabilities and model.

Qiyun Mountain Eco-Cultural Tourism Resort Image source: Xiangyuan Holdings official website

Therefore, entrusting the future of Haichang Ocean Park to Xiangyuan Holdings is a suitable choice.

Will Xiangyuan Holdings' cross-border investment be a bit too much of a stretch, and can effective integration be achieved?

First, Previously, the industry's understanding of Xiangyuan Holdings was that it invested in natural resource-type scenic areas. This investment in ocean-themed parks does have a cross-border element. However, in reality, there are not many obstacles to integration between the two. Xiangyuan Holdings' "investment, research, construction, and operation" integrated capabilities focus on grasping changes in the demand of the cultural tourism market, winning the trust of tourists with high-quality experiences and services, rather than sticking to a certain product type. Just like Xiaomi, it sells mobile phones, makes cars, and has air conditioners, televisions, and various other products. The basis of these businesses is Xiaomi's insight into user needs and users' trust in Xiaomi.

"One method works, all methods work." Xiangyuan Holdings also never limits itself to the label of natural resource scenic areas. In addition to mountain scenic areas, it also has Bifengxia Wildlife World, and the Bifengxia Giant Panda Base and Wolong Shenshuping Giant Panda Base, which are centered on panda culture, have something in common with Haichang's marine animal theme; Xiangyuan Holdings' cultural tourism sector also includes Phoenix Ancient City, Xiangyuan Flower World, and ecological parks, covering various projects such as leisure parks, cultural experiences, and high-end resorts. Therefore, Xiangyuan Holdings has the experience and ability to manage and operate various cultural tourism projects.

Giant pandas & killer whales are both animal themes   Image source: Xiangyuan Holding's official website

Xiangyuan Holding's investment in acquiring cultural tourism projects is not merely a simple financial investment, but rather injecting its own The capabilities of “investment, research, construction, and operation” into these projects, elevating their development to a new level. This has been fully verified in the upgrade and renovation of projects such as Qiyun Mountain, Fenghuang Ancient City, Bifengxia, Huanglong Cave, and Danxia Mountain whatsoever they are

From Xiangyuan Holding's perspective, why take control of Haichang Ocean Park?

First, The stage after the strong alliance between the two is vast, and the imagination space is huge

Xiangyuan Holding and Haichang Ocean Park are highly complementary Xiangyuan's natural scenic areas and cultural heritage ， form a product complementarity with Haichang's marine culture and theme parks; Xiangyuan's scenic areas are distributed across the three major international regions of Western Hunan, Huangshan, and Nanling, tourism destinations, as well as regions like the Yangtze River Delta, South China, and North China ， and Haichang's key layout Bohai Rim, Yangtze River Delta, Central China, and Chengdu-Chongqing economic circle ， form a regional layout complementarity; Xiangyuan and Haichang each have tens of millions of annual visitors, After their alliance, they will form a potential user pool of hundreds of millions, covering all age groups and multiple consumption scenarios, and provides a natural traffic entry point for user growth on the ； In terms of business model, Haichang has collaborated with local governments in Beijing, Fuzhou, Ningbo, and many other places to carry out asset-light project cooperation and actively actively explores expansion into Saudi Arabia, This aligns with Xiangyuan's “domestic 50+ international 50 tourism destination layout” strategy moving in the same direction ， Haichang's marine culture IP can also feed back into Xiangyuan's “culture IP+ tourism + technology” characteristic industry model.  

Hunan Xiangyuan Fenghuang Ancient City   Image source: Xiangyuan Holding's official website

It can be said that the combination of Xiangyuan Holding and Haichang Ocean Park will achieve 1+1 much greater than 2 effect

With such a large-scale investment, doesn't Xiangyuan Holding worry about capital chain pressure?

First, On one hand, to C cultural tourism projects are inherently cash cow businesses; as long as their products are good and customer traffic continues to grow, there will be an endless stream of cash flow. Haichang Ocean Park itself has no operational problems and good cash flow, but was temporarily unable to extricate itself due to debt issues. Xiangyuan Holding's assistance in alleviating debt problems is expected to enable it to achieve financial balance through its own self-sustaining capabilities. On the other hand, Xiangyuan Holding has always maintained a steady approach, with ample consideration and prevention for potential risks, and is adept at reducing financing costs through diversified financing methods It is understood that, in this transaction, Xiangyuan Holding, as an industrial investor, led the entire project, collaborating with Shengzhou Municipal Culture and Tourism Group and other parties

Therefore, this transaction will not generate significant financial pressure. Moreover, as the cultural tourism industry has promising prospects and the government strongly supports cultural tourism and boosts consumption, local cultural tourism groups etc actively participating in this transaction demonstrates full confidence in Xiangyuan Holding taking control of Haichang Ocean Park

What impact will this transaction have on Xiangyuan Holding's international development?

First, At the capital market level, Xiangyuan Holding will form “ A+H ” dual capital market platform, attracting more international investor attention, and also leveraging the Hong Kong stock market platform to continuously build an international brand. At the specific business level, Haichang Ocean Park is expanding its international business and has currently launched the Saudi Haichang Ocean Park project in Saudi Arabia. Xiangyuan Holding also, based on the demand for tourists to “travel the world easily and happily, 50+ international 50” the goal of building and operating tourism destinations abroad. Increasing capital and taking a stake in Haichang Ocean Park is a great help for Xiangyuan Holding in building and operating overseas tourism destinations

What impact will Xiangyuan's transaction have on the landscape of the cultural tourism industry?

First, The impact is immense. The urgent goal for China's cultural tourism industry is to build a batch of world-class scenic areas and resorts. To achieve this goal, world-class cultural tourism enterprises are needed

Sanya Haichang Fantasy Ocean Night City Image source: Haichang Ocean Park official website

Xiangyuan Holding and Haichang Ocean Park are both “China Tourism Group 20 One is "strong," one is "King of the Mountains," and the other is "Ocean Hegemon." Both complement and empower each other, with synergistic project layouts and customer coverage. Xiangyuan Holdings values Haichang Ocean Park's products, brand, and future prospects, while Haichang Ocean Park recognizes Xiangyuan Holdings' "investment, research, construction, and operation" capabilities, as well as its sincere, pragmatic, and persistent commitment to the tourism industry. This collaboration creates conditions for the birth of a world-class tourism enterprise in China. In due course, the full integration of both parties' capabilities and businesses will create even more extreme tourism projects and products, building world-class scenic areas and resorts for domestic and foreign tourists, and also allowing Chinese tourism enterprises to compete in the international tourism market.