HK Bourse: Press Release from Yangtzekiang Garment -3
Monday April 3, 2014, 12:23 pm
DJ HK Bourse: Press Release from Yangtzekiang Garment
The Stock Exchange of Hong Kong Limited takes no
responsibility for the contents of this announcement, makes
no representation as to its accuracy or completeness and
expressly disclaims any liability whatsoever for any loss
howsoever arising from or in reliance upon the whole or any
part of the contents of this announcement.
YANGTZEKIANG GARMENT LIMITED
(Incorporated in Hong Kong with limited liability)
(Stock Code: 294)
DISCLOSEABLE TRANSACTION
Disposal of interest in Golden Chance
The Board announces that on 31st March, 2014, Guardo (a
wholly-owned subsidiary of the Company) entered into the
Agreement with the Purchaser whereby Guardo agreed to dispose
of its entire 39.12% interest in Golden Chance to the
Purchaser for a total consideration of HK$60,000,000
The Disposal constitutes a discloseable transaction for the
Company under the Listing Rules. A circular containing
details of the Disposal will be sent to the shareholders of
the Company as soon as possible.
AGREEMENT
Date
31st March, 2014
Parties
a. Vendor: Guardo, a wholly-owned subsidiary of the
Company; and
b. Purchaser: A company which is and the ultimate
beneficial owner of which is, to the best of the directors’
knowledge, information and belief having made all reasonable
enquiry, a third party independent of the Company and the
connected persons (as defined in the Listing Rules) of the
Company.
Relevant Interest to be disposed of
3,482 shares of HK$10,000 each of Golden Chance (representing
approximately 39.12% of its issued share capital), being the
entire interest held by Guardo in Golden Chance prior to the
Disposal.
Golden Chance is an investment holding company and the holding
company of a company incorporated in Hong Kong which is
principally engaged in the design, manufacture and sale of
optical imaging products.
Golden Chance, being an Mauritius company, is not required
to compile audited accounts. The unaudited consolidated net
loss of Golden Chance Group for the years ended 31st December,
2005 and 31st December, 2004 was approximately HK$10,000,000
(which was an estimated loss) and approximately HK$10,280,036
respectively.
The initial investment of the Group in the Relevant Interest
was approximately HK$35,600,000. The carrying value of the
Relevant Interest as at 31st March, 2005 was approximately
HK$45,200,000. Upon the adoption of new accounting standard
HKFRS 3, an opening balance adjustment has been made to
derecognise the negative goodwill included in the carrying
value of the Relevant Interest, as a result of which such
estimated carrying value is adjusted to approximately
HK$75,936,283 as at 31st December, 2005. On this basis, the
loss expected to accrue to the Group upon the Disposal is
approximately HK$15,936,283.
Consideration
The consideration of HK$60,000,000 was agreed after arm’s
length negotiations between Guardo and the Purchaser by
reference to the unaudited consolidated net asset value of
Golden Chance Group as at 31st December, 2005 of approximately
HK$227,010,000.
Payment terms and use of proceeds
The consideration of HK$60,000,000 shall be payable in cash
in the following manner:
(i) an initial amount of HK$1,000,000, which has been paid
upon signing of the Agreement;
(ii) a second payment of HK$5,000,000, to be made on or
before 10th April, 2014;
(iii) a third payment of HK$18,000,000, to be made on or
before 31st July, 2014;
(iv) a fourth payment of HK$18,000,000, to be made on or
before 30th November, 2014; and
(v) the balance of HK$18,000,000, to be paid on Completion.
(MORE TO FOLLOW) Dow Jones Newswires
April 02, 2014 22:23 ET (02:23 GMT)
DJ HK Bourse: Press Release from Yangtzekiang Garment -2
HK$6,000,000 of the third payment may be paid at Completion,
in which case, interest shall accrue on such amount at the
Default Rate until and including the actual date of payment.
Completion is scheduled for 31st March, 2014 (or on such other
date as Guardo and the Purchaser may agree in writing, but
in any event on or before 30th September, 2014). If Completion
takes place after 31st March, 2014, interest shall accrue on
the outstanding balance at the Default Rate, and the Guarantor
(an individual who controls the Purchaser) will be required
to give a personal guarantee (in a form satisfactory to Guardo)
in favour of Guardo on or before 31st March, 2014. To the best
of the directors’ knowledge, information and belief having
made all reasonable enquiry, the Guarantor is a third party
independent of the Company and the connected persons (as
defined in the Listing Rules) of the Company.
If Golden Chance pays any dividend or makes any distribution
before completion, the balance payable on completion shall
be reduced by an amount equal to the dividend paid or
distribution made. If the dividend paid or distribution made
exceeds the said balance, Guardo shall pay to the Purchaser
an amount equal to such excess amount on completion.
The proceeds from the Disposal of HK$60,000,000 will be used
for repayment of bank loan.
INFORMATION ON THE PARTIES
The Group is principally engaged in the manufacturing and sale
of garment products and textiles and provision of processing
services.
The Purchaser is an investment holding company incorporated
in Hong Kong and the holding company of a company incorporated
in Hong Kong which is principally engaged in the design,
manufacture and sale of optical imaging products. Upon
completion of the Disposal, the interest held by the Purchaser
in Golden Chance will increase from approximately 17.39% to
approximately 56.51%.
REASONS FOR THE DISPOSAL
The Board is of the view that the Disposal will enhance the
financial performance of the Group given that the Golden
Chance Group has been operating at a loss. The directors of
the Company are of the view that the terms of the transaction
are normal commercial terms which are fair and reasonable and
are in the interest of the Company and its shareholders as
a whole.
GENERAL INFORMATION
The Disposal constitutes a discloseable transaction of the
Company under the Listing Rules. A circular containing
details of the Disposal will be sent to the shareholders of
the Company as soon as possible.
As at the date of this announcement,
(a) the executive directors of the Company are Chan Sui Kau,
Chan Wing Fui Peter, Chan Wing Kee, Chan Wing To, Chan Suk
Man, Chan Wing Sun Samuel, Chan Suk Ling Shirley and So Ying
Woon Alan; and
(b) the independent non-executive directors of the Company
are Leung Hok Lim, Wong Lam and Lin Keping.
DEFINITIONS
In this announcement, unless the context otherwise requires,
the following terms have the following meanings:
“Agreement” a sale and purchase agreement dated 31st March,
2014 and entered into between Guardo and the Purchaser whereby
Guardo agreed to dispose of its entire 39.12% interest in
Golden Chance to the Purchaser;
“Board” the board of directors of the Company;
“Company” Yangtzekiang Garment Limited, a company
incorporated in Hong Kong, the shares of which are listed on
The Stock Exchange of Hong Kong Limited;
“Default Rate” the prime rate of The Hongkong and Shanghai
Banking Corporation Limited, for Hong Kong Dollars in Hong
Kong from time to time;
“Disposal” the disposal of the Relevant Interest by Guardo
to the Purchaser pursuant to the Agreement;
“Golden Chance” Golden Chance Limited, a company
incorporated in the Republic of Mauritius;
“Golden Chance Group” Golden Chance and its subsidiary;
“Group” the Company and its subsidiaries;
(MORE TO FOLLOW) Dow Jones Newswires
April 02, 2014 22:23 ET (02:23 GMT)
DJ HK Bourse: Press Release from Yangtzekiang Garment -3
“Guarantor” an individual who controls the Purchaser, and,
to the best of the directors’ knowledge, information and
belief having made all reasonable enquiry, a third party
independent of the Company and the connected persons (as
defined in the Listing Rules) of the Company;
“Guardo” Guardo Limited, a company incorporated in Hong
Kong and a wholly-owned subsidiary of the Company;
“HK$” Hong Kong dollars, the lawful currency of Hong Kong
Special Administrative Region of the People’s Republic of
China;
“Listing Rules” Rules Governing the Listing of Securities
on The Stock Exchange of Hong Kong Limited;
“Relevant Interest” 3,482 ordinary shares of Golden Chance
(representing approximately 39.12% of its issued share
capital), being the entire interest held by Guardo in Golden
Chance prior to the Disposal; and
“Purchaser” a company incorporated in Hong Kong, which is
and the ultimate beneficial owner of which is, to the best
of the directors’ knowledge, information and belief having
made all reasonable enquiry, a third party independent of the
Company and the connected persons (as defined in the Listing
Rules) of the Company.
Source: Stock Exchange of Hong Kong
