L'Oreal SA (ENXTPA:OR) made a proposal to acquire Magic Holdings International Limited (SEHK:1633) from a group of sellers for HKD 6.5 billion on August 12, 2013. The sellers include She Yu Yuan, Wu Xiao Qing, Tang Siu Kun Stephen, Luo Yao Wen, Wen Yan Juan, Sun Yan, Yan Kam Tong, Yang Rude, Baring Asia Private Equity Fund V, L.P., a fund of Baring Private Equity Asia, Greenwoods Asset Management Limited, Atlantis Investment Management (Hong Kong) Ltd. and Riverwood Asset Management Cayman Limited, Atlantis China Star Fund and other shareholders. L'Oreal will pay HKD 6.3 per share as a consideration. The transaction will be consummated by way of a scheme of arrangement. Tang Siu Kun Stephen, She Yu Yuan, Luo Yao Wen, Baring, Greenwoods and Atlantis have each given an irrevocable undertaking to L'Oreal. L'Oreal intends to finance the cash required from the internal financial resources. BNP Paribas SA has granted L'Oreal a credit facility in the amount of HKD 6.74 billion, which may be used by L'Oreal to finance the proposal, if necessary. She Yu Yuan, an executive Director of Magic Holdings International, will serve as Chief Executive Officer of the Magic Group and Director of Magic Holdings Group Limited, a wholly-owned subsidiary of Magic Holdings International. Upon the scheme becoming effective, it is anticipated that listing of the shares on the Stock Exchange will be withdrawn and terminated.

The proposal is subject to fulfillment of the pre-conditions which include - filing having been submitted to and accepted by the Ministry of Commerce of the PRC under the anti monopoly law of the PRC; if required by law, any consent or approval of any other PRC governmental or regulatory body. The implementation of the proposal and scheme is subject to the approval of the scheme by a majority in number of the scheme shareholders representing not less than 75% in value of the shares, the passing of a special resolution by a majority of not less than three-fourths of the votes cast by the shareholders to approve and give effect to the reduction of the share capital of Magic Holdings by cancelling and extinguishing the shares and the passing of an ordinary resolution by the shareholders at an extraordinary general meeting to immediately thereafter increase the issued share capital of Magic Holdings to the amount prior to the cancellation of the shares for issuance to L'Oreal, the receipt of an opinion from the independent financial adviser confirming that the terms of the remuneration package are fair and reasonable, and the passing of an ordinary resolution by the independent shareholders of Magic Holdings to approve the terms of the remuneration package, the Grand Court's sanction of the scheme. MOFCOM approved the transaction on January 9, 2014 and all conditions of the transaction have now been satisfied. L'Oreal SA plans to complete the transaction by second quarter of 2014. As on February 20, 2014, time limit to dispatch the scheme document is extended from February 20, 2014 to March 14, 2014.

The independent Board committee, which comprises all the non-executive Directors of Magic Holdings, namely Sun Yan, Chen Dar Cin, Yan Kam Tong, Dong Yin Mao and Yang Rude, has been established by the Board to make a recommendation to the independent shareholders. An independent financial adviser will be appointed to advise the independent Board committee in connection with the proposal. The shareholder meeting of Magic Holdings is scheduled on March 24, 2014. As on February 28, 2014, the Board of Magic recommened the shareholders to approve the transaction. As on April 6, 2014, the scheme was sanctioned without modification by the Grand Court on April 4, 2014. The Grand Court sanctioning the scheme is expected to be delivered to the Registrar of Companies in the Cayman Islands for registration and is expected to become effective on April 7, 2014. The Stock Exchange has approved the withdrawal of the listing of the shares on the Stock Exchange with effect from April 9, 2014. Tricor Investor Services Limited acted as registrar for Magic. BNP Paribas Securities (Asia) acted as financial advisor for L'Oreal SA. Chiu & Partners acted as legal advisor for Atlantis Investment Management and Baring Private Equity. Bruno Derieux, Teresa Ma, Geoffrey Tang, Josephine Yung, Samantha Thompson, Matthew Middleditch, Eric Liu, Eric Cheng, Mandy Huang, George Chiu, Pierre Thomet, Julien Bourmaud-Danto, Nicolas Zacharie, Edouard Chapellier, Anne Wachsmann, Kent To, Flora Suen-Krujatz, David Liu, Jonathan Zipfinger, Christophe Carrière, Alex Roberts, Crystal Zhu, Shaun Gadher, Shang Li, Colette Pan, Yuan Cheng, Marcus Pollard, Qiuying Zheng, Phyllis Wong, Wendy Huang and Deborah Papworth of Linklaters acted as legal advisors to L'Oréal S.A. Harney Westwood & Riegels and Baker & McKenzie acted as legal advisors to L'Oréal S.A. Gilbert Fayol, Julie Demangel, Christèle Fraisse and Emmanuel Vignal of Deloitte acted as due diligence advisor to L'Oreal SA. KPMG acted as accountants, and Jingtian & Gongcheng acted as legal advisor in the deal. Bureau Veritas acted as advisor in the deal. Chiu & Partners and Conyers Dill & Pearman acted as legal advisors to Magic Holdings. Quam Capital Limited acted as financial advisor for Magic Holdings International Limited. Robert W. Baird & Co. acted as financial advisor in the transaction.

L'Oreal SA (ENXTPA:OR) completed the acquisition of Magic Holdings International Limited (SEHK:1633) from a group of sellers on April 8, 2014. Jingtian & Gongcheng acted as legal advisor to Magic Holdings International Limited.