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Li Ning Company Limited is one of the leading sports brand enterprises in the PRC, possessing brand marketing, research and development, design, manufacturing, distribution and retail capabilities. The Group's products include footwear, apparel, accessories and equipment for sport and leisure uses. The Group has established an extensive supply chain management system, and a distribution and retail network in the PRC primarily through outsourcing of manufacturing operations and distribution via franchised agents. The Group also directly manages retail stores for the LI-NING brand. The Group adopts a multi-brand business development strategy. In addition to its core LI-NING brand, the Group distributes sports products under its Z-DO brand via hypermarket channel. The Group has established a joint venture with AIGLE under which the joint venture has been granted an exclusive right by AIGLE to manufacture, market, distribute and sell outdoor sports products under the French brand AIGLE for 50 years in the PRC. In 2008, the Group acquired a controlling interest in Double Happiness, which together with its subsidiaries, are principally engaged in manufacturing, research and development, marketing and sale of table tennis and other sports equipment under the Double Happiness brand. In 2008, the Group also entered into an exclusive 20-year license agreement with Lotto to develop, manufacture, market, distribute and sell the licensed products under the Italian sports fashion brand Lotto in the PRC. In 2009, the Group completed acqusition of Kason, which is principally engaged in the reseach and development, manufacture and sale of professional badminton equipment under the Kason brand such as rackets, strings, shuttlecocks, apparel, footwear and accessories.
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