China United Travel Co. Drains Bath on Hot Springs as Popularity Cools
China United Travel Co. Ltd. has sold a hot-spring resort near Nanjing, capital of East China’s Jiangsu province, for 299 million yuan ($45.4 million), as tourists’ interest in the themed destination dries up.
The deal was reached after two previous unsuccessful attempts to offload the Tangshan Hot Springs resort, which China United Travel first put up for sale in July, valuing the resort at 390.6 million yuan. An individual named Sun Guiyun will buy all shares in Tangshan Hot Springs for 13 million yuan more than the minimum asking price of 286 million yuan, the company said Thursday.
Tangshan Hot Springs was designated a national tourism destination in 2015, and has been operated by the Shanghai-listed travel company. The resort, whose Mandarin name means “soup mountain,” is home to public pools that include a traditional Chinese Medicine pond and a “sizzling volcano pond,” according to a Nanjing Municipal Tourism Commission website.
Tangshan Hot Springs also boasts a number of Balinese-style luxury villas, and a Thai-themed spa.
But despite its varied attractions, tourist interest has cooled and the resort began losing money in 2016. As part of the sale agreement, China United Travel will need to pay 2.75 million yuan to cover the losses incurred by the resort from July 1 to Oct. 31 this year.
China United Travel’s handover of Tangshan Hot Springs will be a major step in its transition away from its past focus on hot springs and toward sports and leisure. In 2015, the travel firm announced a 2.5 billion yuan sports buyout fund with partner Fairview (Beijing) Capital Management Co. Ltd. In September, the company said it planned to acquire a 100% stake in sporting events company Duo Sport Group Media Co. Ltd. for 495 million yuan.
The company’s transition comes at a time when heavy investment has been pouring into China’s sports industry in the hope of finding new room for growth. In a similar move in August, property developer Lander Sports Development Co. Ltd. sold 54 properties for a total of $31.2 million in August in order to finance its plans for massive sports hubs across China.
Contact reporter Teng Jing Xuan (firstname.lastname@example.org)
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