FUZHOU, China – China Yida Holding Co., Ltd. announced that it has signed a letter of intent with the Yongtai county government to develop the largest leisure and tourism destination in the city of Fuzhou, the capital of Fujian Province. China Yida has submitted the proposed transaction to the local government for approval and expects to reach a definitive agreement by the end of 2008.
This leisure and tourism destination will be an ideal destination for both recreation and vacation. It has the potential to become a world-class resort attracting visitors from neighboring coastal areas such as Xiamen, Quanzhou, and Putian, as well as from other regions of China. In addition, the cities of Fuzhou and Xiamen are both popular destinations for business functions and conferences, which is expected to help attract visitors to the site from domestic and overseas markets. The leisure and tourism destination is located near the capital city of Fuzhou in Yongtai County, Fujian Province, and the entire scenic site has a total area of 48 square kilometers. The destination features more than 7 square kilometers of mountainous grassland, a 70 million year-old volcanic geological structure, an aboriginal volcanic waterfall, and a large-scale terrace and village with more than 1,000 years of history. We plan to develop the site infrastructure to provide visitors with convenient transportation options to travel throughout the destination.
Under the terms of the letter of intent with the Yongtai county government, China Yida will have operational and management rights to the site for 40 years, which reduces the risks and uncertainties related to the investment, and contributes to China Yida’s ability to secure a long-term return on investment. To its advantage, China Yida will not be required to pay the transfer fee for the management rights up front; rather, the cost of securing the management rights will be sourced from a percentage of site admission revenue and a percentage of revenue from other government-franchised operations associated with the destination. Additionally, in the event of termination or early termination by either the company or the Yongtai county government for any reason not related to a change in government regulation, the Yongtai county government will repurchase the tangible and intangible assets related to China Yida’s investment in the development of the site at fair market value.
“In our continuous efforts to scale our unique media and tourism business model in China, our experienced management team is very pleased to partner with the Yongtai County Government to develop the largest scenic spot for visitors and residents of the Fuzhou city area, furthering our leadership position in the tourism business in the Fuzhou area,” said Dr. Chen Minhua, chairman of China Yida. “This partnership not only demonstrates our ability to execute on our strategy to replicate the success of the Great Golden Lake site, but will also bring synergies to the company as we secure an additional recreational site in Fujian province. The site offers a different type of leisure and vacation experience from the Great Golden Lake and greatly enhances our current portfolio of investments.
“We are constantly investigating ways to expand our media and tourism businesses in China and improve the quality of services that we provide. This initiative will significantly contribute to achieving our business objectives, while positioning us for further expansion in the media and tourism businesses,” Dr. Chen concluded.