On April 18th 2008, New Elegant Living, the owner of antique flooring patent, and Samling Group, the famous international forestry company in Malaysia, announced a strategic partnership. Samling Group will invest USD38.3 million, and hold a 70% stake in New Elegant Living, thus becoming the largest shareholder of New Elegant Living.

The development of a strategic partnership between New Elegant Living and Samling Group not only provides significant funding for Elegant Living, and strengthened access to resources, but also promotes an integrated approach for manufacturing, innovation and marketing. The event was also extremely important in promoting the growth of Elegant Living in both domestic and global markets and transforming Elegant Living into an international company. The cooperation between the two companies will be very important in further accelerating the internationalization and globalization of China’s flooring industry, and opening up a new path for sustainable business development and growth.

In recent years, along with the rapid and healthy development of Chinas economy, China’s flooring industry has played a very important role in international markets. In 2007, the output of flooring in China climbed to 361 million m2, and this volume is forecast to climb 13% per year through 2010. Consequently, in 2010 the output of Chinas floor will top 500 million m2. Elegant Living, as the owner of antique flooring patent, has great influence in the engineered wood flooring, both at home and abroad, and the company is ranked first in market share in China. Because of the huge upgrading market and almost infinite market potential, Elegant Living had attracted the attention of many international companies. The entry of Samling acknowledges the great potential of Chinas flooring industry and the broad prospects of Elegant Living.

Recently, with the global shortage of wood resources and the rise of prices for wood raw materials, the development of Chinas flooring industry has been restricted. It is forecast that, in 2010, the gap between supply and demand of wood in China will top 280 million m3. Right now log imports amount to 120 million m3, far behind the demand in China. Facing such a serious shortfall, Chinese companies need to promote the intensive forest management, improve operating efficiency, and focus on integrating both up- and down stream. As one of the top brand companies, Elegant Living needs to own more natural resources, and strengthen its resources advantage to create the conditions for rapid development of the company, including a growing international presence. It is anticipated that the cooperation between the two companies will help Elegant Living to solve the resource availability issue, and offer a favorable foundation for the development of Elegant Living. To expand its anticipated international advantage, Elegant Living has signed license agreements respecting fastener patents as well as engineered floor plane technique patents of Valinge and Faus respectively.

Samling Group, an international forest resource and wood products company, has about 4 million ha. forest resources and 1.4 million m3 of wood products capacity. Its business involves the management both up- and downstream of the wood products business. Up-stream includes logging and management of natural forest in Malaysia and Guyana, and of plantations in New Zealand and Malaysia. Downstream includes manufacturing and marketing. As a well known international forest management company, the cooperation between Elegant Living and Samling offers plentiful raw materials for Elegant Living, as well as large financial resources to promote the manufacture of products with high added value, to expand market share for Samlings flooring products, and accelerated growth of the Samling distribution network in China.

In conclusion, huge market potential and broad prospects provide good conditions and opportunities for win-win cooperation between Elegant Living and Samling, as well as opening up a new level of international cooperation for Chinas flooring industry. This development provides a model for other Chinese flooring companies striving to penetrate international markets.