GREENLAND HONG KONG HOLDINGS LIMITED Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.
綠地香港控股有限公司
(incorporated in the Cayman Islands with limited liability)
(Stock Code: 337)The Board is pleased to announce that on 22 January 2016, Shanghai Cambridge, a subsidiary of the Company, entered into the Agreement to sell to Shanghai Xinhua Publishing 67.14% of the equity interest in, and the Shareholder's Loan to, Shanghai Sipo Education for a total Consideration of approximately RMB349 million (approximately HK$416 million). As at the date of this announcement, Shanghai Cambridge owns 67.14% of the equity interest in Shanghai Sipo Education.
As the highest applicable percentage ratio under the Listing Rules in respect of the Transaction is more than 5% but less than 25%, the Transaction constitutes a discloseable transaction for the Company, and is subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.
As at the date of this announcement, Greenland Holding indirectly holds approximately 58.75% of the entire issued ordinary share capital of the Company and is a connected person of the Company under the Listing Rules. Greenland Group holds approximately 39% of the equity interest in Shanghai Xinhua Publishing. Accordingly, Shanghai Xinhua Publishing is a connected person of the Company under the Listing Rules. The highest applicable percentage ratio for the Transaction exceeds 5%. Accordingly, the Transaction also constitutes a connected transaction of the Company and is subject to the reporting, announcement and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.
The Independent Board Committee, comprising all independent non-executive Directors, has been formed to advise the Independent Shareholders on the fairness and reasonableness of the terms of the Agreement and on how to vote on the resolution(s) to be proposed at the EGM taking into account the recommendation of the independent financial adviser. Somerley Capital has been appointed as the independent financial adviser to make recommendations to the Independent Board Committee and the Independent Shareholders in respect of the same.
A circular containing, among others, a letter from the Board containing details of the Transaction, a letter from the Independent Board Committee and a letter from Somerley Capital advising on the terms of the Agreement, and a notice of EGM will be despatched to Shareholders on or before 17 February 2016.
The principal terms of the Agreement are summarised as follows: Date : 22 January 2016
Seller : Shanghai Cambridge
Purchaser : Shanghai Xinhua Publishing Target Company : Shanghai Sipo Education
Consideration : The total Consideration is approximately RMB349 (approximately HK$416) million comprising:
the purchase price for the 67.14% equity interest in Shanghai Sipo Education of approximately RMB321 million (approximately HK$382 million); and
t h e purchase price for the Shareholder's Loan of approximately RMB28 million (approximately HK$33 million).
Subject matter : The 67.14% equity interest in Shanghai Sipo Education and the Shareholder's Loan.
Other party to the Agreement
: Shenzhen Huibo, the holder of 32.86% of the equity interest in, and a shareholder's loan of approximately RMB4 million (approximately HK$4.76 million) to, Shanghai Sipo Education, also entered into this Agreement, to sell to Shanghai Xinhua Publishing its 32.86% equity interest in, and its shareholder's loan to, Shanghai Sipo Education on the same pricing basis and other terms.
Shenzhen Huibo is principally engaged in investment in education and related services.
As at the date of the Agreement, the Company confirms that, to the best of the directors' knowledge, information and belief having made all reasonable enquiry, Shenzhen Huibo is a third party independent of the Company, Greenland Holding and Shanghai Cambridge.
CONDITIONCompletion of the Transaction is conditional upon the Company having obtained Independent Shareholders' approval as required under the Listing Rules.
The Consideration shall be settled in cash by the Purchaser in the following manner:
Within five working days upon the execution of the Agreement, the Purchaser shall pay approximately RMB109 million (approximately HK$130 million) to Shanghai Cambridge;
Within ten working days upon the issuance of a transaction certificate by Shanghai Cultural Assets and Equity Exchange Co., Ltd.* (上海文化產權交易所), the Purchaser shall pay approximately RMB171.2 million (approximately HK$204 million) to Shanghai Cambridge; and
Within ten working days upon the registration of transfer of shares at the Company Registration Office, the Purchaser shall pay approximately RMB68.5 million (approximately HK$82 million) to Shanghai Cambridge.
Upon Completion, Shanghai Sipo Education will cease to be a subsidiary of the Group.
The Consideration was arrived at after arm's length negotiation between the parties and was determined with reference to the financial position and business prospects of Shanghai Sipo Education, and a valuation report prepared by an independent valuer as at 30 September 2015 in respect of the equity interest in, and the Shareholder's Loan to, Shanghai Sipo Education.
According to the said valuation report, the appraised consolidated net asset value of Shanghai Sipo Education as at the 30 September 2015 was approximately RMB478 million (approximately HK$569 million). The net loss attributable to the assets of Shanghai Sipo Education before and after taxation for the year ended 31 December 2013 were RMB2 million and 4 million, respectively. The net profit attributable to the assets of Shanghai Sipo Education before and after taxation for the year ended 31 December 2014 were approximately RMB11 million and RMB10 million, respectively.
Upon Completion, it is estimated that Shanghai Cambridge would realise a gain on the Transaction before taxation attributable to the owners of the Company of approximately RMB269 million (approximately HK$320 million), taking into account its 67.14% equity interest in Shanghai Sipo Education and the Shareholder's Loan (the "Interest"), which is calculated on the basis of the difference between the Consideration and the Shanghai Cambridge's total cost of investment in the Interest and relevant expenses. The actual gain on the Transaction to be recorded is subject to audit and may be different from the estimated amount as the actual gain or loss will depend on, amongst other factors, the actual net asset value of Shanghai Sipo Education as at Completion.
Shanghai Cambridge has held its equity interest in Shanghai Sipo Education for more than 12 months.
The Group is principally engaged in real estate development in various cities in the PRC including Shanghai, Kunming, Huangshan, Suzhou, Changshu, Wuxi, Haikou and Taiyuan.
Greenland Holding is an enterprise headquartered in Shanghai, PRC and is principally engaged in real estate, energy and finance business. Greenland Holding indirectly holds approximately 58% of the entire issued share capital of the Company.
Shanghai Cambridge is principally engaged in real estate development.
Shanghai Sipo Education is principally engaged in investment in education.
Shanghai Xinhua is principally engaged in cultural assets and equity investment and operation.
The Directors consider that the Transaction will enhance the Company's cashflow position, and provide additional capital resources for the Company to capture other investment opportunities in the real estate market. The proceeds generated from the Transactions will be applied as general working capital of the Company.
The Board (excluding the independent non-executive Directors whose views will be provided after considering the recommendations of the independent financial adviser) considers that the Transaction is on normal commercial terms which are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Mr. Chen Jun and Mr. Wu Zheugkui abstained from voting at the meeting of the Board due to conflict of interest.
As the highest applicable percentage ratio under the Listing Rules in respect of Transaction is more than 5% but less than 25%, the Transaction constitutes a discloseable transaction for the Company, and is subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.
As at the date of this announcement, Greenland Holding indirectly holds approximately 58.75% of the entire issued ordinary share capital of the Company and is a connected person of the Company under the Listing Rules. Greenland Group holds approximately 39% of the equity interest in Shanghai Xinhua Publishing. Accordingly, Shanghai Xinhua Publishing is an associate (within the meaning of the Listing Rules) of Greenland Holding is a connected person of the Company under the Listing Rules. The highest applicable percentage ratio for the Transaction exceeds 5%. Accordingly, the Transaction also constitutes a connected transaction of the Company and is subject to the reporting, announcement and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.
Greenland Hong Kong Holdings Limited issued this content on 2016-01-22 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 2016-01-22 11:54:08 UTC
Original Document: http://www.greenlandhk.com/uploadfile/en/announcement/20160122.EW00337ann.pdf
