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.
(Incorporated in the Cayman Islands with limited liability)
(Stock code: 395)
DISCLOSEABLE AND CONNECTED TRANSACTION
DISPOSAL OF 51% EQUITY INTERESTS OF
A NON-WHOLLY OWNED SUBSIDIARY
The Company is pleased to announce that after arm’s length negotiations between the
relevant parties, 14 October 2015, the Vendor, a non-wholly owned subsidiary of the
Company, entered into the Agreement with the Purchaser in relation to the Possible
Disposal.
After Completion, the Target Company will cease to be a non-wholly owned
subsidiary of the Company. The consideration for the Possible Disposal will be paid
by the Purchaser in cash to the Vendor.
The entering into of the Agreement constitutes a discloseable transaction on the part
of the Company under Chapter 14 of the Listing Rules. As the Vendor, a non-wholly
owned subsidiary of the Company, is the registered holder of 51% of the issued
shares of the Target Company and the Purchaser is a director and the registered
holder of 14.7% of the issued shares of the Target Company, the Purchaser is a
connected person of the Company at the subsidiary level and the entering into of the
Agreement and the transactions contemplated thereunder will also constitute
connected transaction on the part of the Company under Chapter 14A of the Listing
Rules.
As the Board have approved the Agreement and the transactions contemplated
thereunder and the independent non-executive Directors have confirmed that the
terms of the Agreement are fair and reasonable and the transactions contemplated
thereunder is on normal commercial terms and in the interests of the Company and
the Shareholders as a whole, given that the Purchaser is a connected person at the
subsidiary level only, the Agreement and the transactions contemplated thereunder is
exempt from the circular, independent financial advice and independent
Shareholders’ approval requirements pursuant to Rule 14A.101 of the Listing Rules.
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The Company is pleased to announce that after arm’s length negotiations between the
relevant parties, on 14 October 2015, the Vendor (a non-wholly owned subsidiary of
the Company) entered into of the Agreement with the Purchaser in relation to the
Possible Disposal. The entering into of the Agreement and the transactions
contemplated thereunder constitute a discloseable and connected transaction on the
part of the Company under Chapters 14 and 14A of the Listing Rules. Set out below
are the principal terms of the Agreement.
THE AGREEMENT
Date
14 October 2015 (after trading hours)
Parties
(i)
the Vendor, a company incorporated under the laws Hong Kong with limited
liability, a non-wholly owned subsidiary of the Company, and the legal and
beneficial owner of 51% equity interests of the Target Company.
(ii)
the Purchaser, an individual, a director and the legal and beneficial owner of
14.7% equity interests of the Target Company.
As the Target Company is a non-wholly owned subsidiary of the Company
immediately prior to the entering into of the Agreement, and the Vendor is the
registered holder of 51% of the issued shares of the Target Company and that the
Purchaser is a director and the registered holder of 14.7% of the issued shares of the
Target Company, the Purchaser is a connected person of the Company at the
subsidiary level. To the best of the Directors’ knowledge, information and belief
having made all reasonable enquiries, save for his interests in the Target Company, the
Purchaser is an Independent Third Party.
The Possible Disposal
Pursuant to the Agreement, it was agreed that the Purchaser shall acquire and the
Vendor shall sell the Sale Capital. The Sale Capital represents 51% of the issued share
capital of the Target Company.
It was agreed after arm’s length negotiations between the parties to the Agreement that
the Possible Disposal shall be conducted by way of sale of the Sale Capital. After
Completion, the Target Company shall cease to be a non-wholly owned subsidiary of
the Company.
Consideration
The total consideration for the Possible Acquisition is HK$680,000 and shall be
settled and paid in cash by the Purchaser to the Vendor on the following dates:
(a)
(b)
Upon Completion, HK$180,000.
On or before 22 March 2016, HK$125,000.
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(c)
(d)
(e)
On or before 22 August 2016, HK$125,000.
On or before 22 January 2017, HK$125,000.
On or before 22 June 2017, HK$125,000.
The consideration for the Sale Capital was determined after arm’s length negotiations
between the Vendor and the Purchaser after considering various factors, including the
nature of business of the Target Company and the necessity for further capital
injection for the future conduct of its business with an uncertainty on its business
prospects and so forth.
The Directors (including the independent non-executive Directors) consider that the
consideration is fair and reasonable and in the interests of the Company and the
Shareholders as a whole.
Conditions precedent
Completion is subject to the following conditions having been fulfilled or waived (as
the case may be):
1. the consents and approvals have all been obtained in respect of all requirements,
rules, regulations and Agreement pursuant to relevant laws, Hong Kong Stock
Exchange and Securities and Futures Commission, or on sale or purchase of the
Sale Capital pursuant to the Memorandum and Articles of Association of the
Target Company, or the Memorandum and Articles of Association of the Vendor or
the Memorandum and Articles of Association of the Purchaser (if required by
Stock Exchange or the Listing Rules, the consent and approval from the
Independent Shareholders of the Vendor’s holding company).
2. All requisitions raised by the Hong Kong Stock Exchange and Securities and
Futures Commission in respect of the transaction contemplated herein have been
answered satisfactorily.
The conditions stated above cannot be waived by the parties to the Agreement. If the
conditions are not fulfilled on or before 22 October 2015 (or such later date as the
parties to the Agreement may agree (but not later than 31 October 2015)), the
Agreement shall cease and terminate and thereafter except otherwise provided under
the Agreement, neither party to the Agreement shall have any obligations and
liabilities towards each other thereunder save for any antecedent breaches thereof.
Completion
Completion shall take place on the date falling the first Business Day after all the
conditions of the Agreement have been fulfilled or waived, if applicable.
INFORMATION OF THE COMPANY, VENDOR AND PURCHASER
Information of the Company
The Company is an investment holding company engaging in a diversified business
including, through its subsidiary in O2O solutions and Wi-Fi wireless network system
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operations.
Information of the Vendor
The Vendor, a non-wholly owned subsidiary of the Company, is a company
incorporated under the laws of Hong Kong with limited liability and is principally
engaging in investment holding. The Vendor holds 51% equity interest of the
authorized, issued and fully paid-up share capital of the Target Company.
Information of the Purchaser
The Purchaser, an individual, is a director and the registered holder of 14.7% of the
issued shares of the Target Company and has over 20 years of experience in telecom
and IT field.
INFORMATION OF THE TARGET COMPANY
The Target Company is a company incorporated in Hong Kong with limited liability
and is principally engaging in the provision of structure cabling, IT infra-structure and
system integration business and system maintenance.
FINANCIAL INFORMATION OF THE TARGET COMPANY
For the year ended 31 December 2014, the audited total assets and net assets are
HK$8,079,000 and HK$2,468,000 respectively. The unaudited net liabilities value of
the Target Company as at 30 June 2015 was approximately HK$157,000.
Set out below is the net profit/(loss) (before and after tax) of the Target Company for
the financial years ended 31 December of 2013 and 2014:
For the year ended
31 December 2013
(Audited)
HK$
For the year ended
31 December 2014
(Audited)
HK$
2,453,000
2,038,000
(624,000)
(614,000)
Net Profit/(loss) (before tax)
Net Profit/(loss) (after tax)
FINANCIAL IMPACT OF THE POSSIBLE DISPOSAL
It is expected that the Company will record a book gain of approximately
HK$837,000 as a result of the Possible Disposal, which represents the difference
between the Consideration for the Sale Capital and the unaudited net liabilities value
of the Target Company as at 30 June 2015. The actual gain or loss in connection with
the Possible Disposal will be assessed after Completion and is subject to audit.
Upon Completion, the Target Company will cease to be subsidiary of the Company
and the financial results of the Target Company will not be consolidated into the
Company’s financial statements.
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REASONS FOR THE POSSIBLE DISPOSAL AND THE USE OF PROCEEDS
The Company is an investment holding company engaging in a diversified business
including, through its subsidiary in O2O solutions and Wi-Fi wireless network system
operations, both of which are considered to be the core businesses of the Company.
The Target Company, a non-wholly owned subsidiary of the Company, is principally
engaging in the provision of structure cabling, IT infra-structure and system
integration business and system maintenance. The financial position of the Target
Company is unsatisfactory, and further capital injection will be necessary for the
future conduct of its business. The Board considers that in disposing the Target
Company, the Company is able to avoid incurring further liability in the Target
Company, as well as in line with the Company’s strategic development in focusing on
its core businesses. After Completion, the Target Company will cease to be a
non-wholly owned subsidiary of the Company.
The Directors expect that the net proceeds from the Possible Disposal of
approximately HK$659,000 will be used by the Company as general working capital.
Taking into consideration of the above factors, the Directors (including the
independent non-executive Directors) consider that the terms and conditions of the
Possible Disposal are fair and reasonable on normal commercial terms and are in the
interests of the Company and the Shareholders as a whole.
LISTING RULES IMPLICATION
The entering into of the Agreement constitutes discloseable transaction on the part of
the Company under Chapter 14 of the Listing Rules. As the Vendor, a non-wholly
owned subsidiary of the Company, is the registered holder of 51% of the issued shares
of the Target Company and the Purchaser is a director and the registered holder of
14.7% of the issued shares of the Target Company, the Purchaser is a connected
person of the Company at the subsidiary level and the entering into of the Agreement
and the transactions contemplated thereunder will also constitute connected
transaction on the part of the Company under Chapter 14A of the Listing Rules.
As the Board have approved the Agreement and the transactions contemplated
thereunder and the independent non-executive Directors have confirmed that the
terms of the Agreement are fair and reasonable and the transactions contemplated
thereunder is on normal commercial terms and in the interests of the Company and the
Shareholders as a whole, given that the Purchaser is a connected person at the
subsidiary level only, the Agreement and the transactions contemplated there under is
exempt from the circular, independent financial advice and independent Shareholders’
approval requirements pursuant to Rule 14A.101 of the Listing Rules.
To the best of the Directors’ knowledge, information and belief having made all
reasonable enquiries, no Directors have a material interest in the Agreement and the
transactions contemplated thereunder and no Directors have abstained from voting in
the board resolutions approving the Agreement and the transactions contemplated
thereunder.
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DEFINITIONS
In this announcement, unless the context otherwise requires, the following terms shall
have the following meanings:
‘‘Agreement’’
The conditional sale and purchase agreement for the
Possible Disposal dated 14 October 2015 entered into
between the Purchaser and the Vendor
“Board”
The board of Directors of the Company
“Company”
Smartac Group China Holdings Limited, a company
incorporated in the Cayman Islands with limited
liability and the issued Shares of which are listed on the
main board of the Stock Exchange (Stock Code : 395)
“Completion”
Completion of the Possible Disposal pursuant to the
terms and conditions of the Agreement
“Completion Date”
22 October 2015 (or a delayed completion date pursuant
to terms and conditions of the Agreement but not later
than 31 October 2015)
‘‘Connected Persons’’
Has the meaning ascribed to this term under the Listing
Rules
“Director(s)”
The director(s) of the Company
“Hong Kong”
The Hong Kong Special Administrative Region of the
People’s Republic of China
“HK$”
Hong Kong dollar, the lawful currency of Hong Kong
“Independent Third
Party(ies)”
Independent third parties who are not connected
person(s) of the Company and are independent of and
not connected with the Company or Directors, chief
executive, or Substantial Shareholders of the Company
or any of its subsidiaries or their respective associates
“Listing Rules”
The Rules Governing the Listing of Securities on the
Stock Exchange
“O2O”
Online to offline
“Parties”
Parties to the Agreement
“Purchaser”
PAUGH, Chung Kei Frederick, an individual, is a
director and the registered holder of 14.7% of the issued
shares of the Target Company
“Sale Capital”
The 51,000 ordinary shares (representing 51% issued
shares of the Target Company) owned by the Vendor
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and its respective rights therein
“Stock Exchange”
The Stock Exchange of Hong Kong Limited
“Target Company”
PCS I-Datacomms Limited, a company incorporated
under the laws of Hong Kong with registration number
1435826
“Vendor”
Smartac International Limited, a company incorporated
under the laws of Hong Kong with registration number
1964832
“%”
Per cent
By Order of the Board
Smartac Group China Holdings Limited
Yang Xin Min
Chairman
Hong Kong, 14 October 2015
As at the date of this announcement, the Directors are Mr. Yang Xin Min, Ms. Huang
Yue Qin and Mr. Kwan Che Hang Jason as executive Directors, and Dr. Cheng Faat
Ting Gary, Mr. Poon Lai Yin Michael and Mr. Yang Wei Qing as independent
non-executive Directors.
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