Man Wah : Announcements and Notices - Voluntary Announcement Acquisition of Recliner Business in Vietnam

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.

MAN WAH HOLDINGS LIMITED ઽശછٰϞࠢʮ̡

(Incorporated in Bermuda with limited liability)

(Stock Code: 01999)

VOLUNTARY ANNOUNCEMENT

ACQUISITION OF RECLINER BUSINESS IN VIETNAM

INTRODUCTION

The Board is pleased to announce that the Purchaser, a wholly owned subsidiary of the Company, has entered into an unconditional agreement in relation to acquisition of the Target Group in Vietnam. Completion of the transfer of the shares of the Target Group shall take place on the Completion Date (15 June 2018).

THE ACQUISITION AGREEMENT

On 12 June 2018, the Acquisition Agreement was signed. The total consideration payable under the Acquisition Agreement is USD68 million (equivalent to approximately HK$533.8 million) attributable to the value of the Target Shares (representing 100% of the issued shares of each member of the Target Group).

USD34 million (equivalent to approximately HK$266.9 million), representing half of the total consideration, was paid by the Purchaser upon signing of the Acquisition Agreement. The remaining balance of the total consideration payable under the Acquisition Agreement shall be payable by the Purchaser within 7 business days after the completion of transfer of Target Shares under the Acquisition Agreement. The above consideration was determined after arm's length negotiations between the parties to the Acquisition Agreement and with reference to the market price of the leasehold land, buildings, inventories and equipment and a premium which the Company considers reasonable. The Directors are of the view that the terms of the Acquisition Agreement are fair and reasonable, and in the interests of the Company and its shareholders as a whole. Following the Completion, each member of the Target Group will become an indirect wholly owned subsidiary of the Company.

The Target Group is principally engaged in the production and sales of sofas, mainly recliner sofas and exportation to overseas market. The Target Group includes Beyond Excel Holdings Limited (a limited liability company incorporated in the British Virgin Islands) and its wholly owned subsidiary, Timberland Company Limited (a limited liability company incorporated in Vietnam).The Target Group holds factories with an area of approximately 130,000 m2 and leasehold land with an area of approximately 300,000 m2.

LISTING RULES IMPLICATIONS

Since the individual vendor under to the Acquisition Agreement is, to the best of the Directors' knowledge, information and belief having made all reasonable enquiries, an Independent Third Party and the relevant percentage ratios of the transactions contemplated therein did not exceed 5%, the transactions contemplated under the Acquisition Agreement did not constitute to notifiable transactions of the Group under Chapter 14 of the Listing Rules.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions shall have the following meanings when used herein:

"Acquisition Agreement"	the agreement dated 12 June 2018 entered into by the Purchaser (as
purchaser) and an individual who is an Independent Third Party (as
vendor) in relation to the acquisition of the Target Shares of the
Target Group by the Purchaser
"Board"	the board of Directors
"Company"	Man Wah Holdings Limited (ઽശછٰϞࠢʮ̡), a company
incorporated in Bermuda with limited liability, the shares of which
are listed and traded on the Main Board of the Stock Exchange
(stock code: 1999)
"Completion"	Completion of the acquisition of the Target Shares by the
Purchaser under the Acquisition Agreement
"Completion Date"	15 June 2018
"Directors"	the directors of the Company
"Group"	the Company and its subsidiaries
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"Independent Third	party(ies) which is/are independent of the Company and its
Party(ies)"	connected persons (as defined under the Listing Rules)
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock
Exchange

"Purchaser"	Man Wah Group Limited, a company incorporated in the British
Virgin Islands and a wholly owned subsidiary of the Company
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Target Group"	Beyond Excel Holdings Limited (a limited liability company
incorporated in the British Virgin Islands), which is wholly owned
by an Independent Third Party, and its wholly owned subsidiary,
Timberland Company Limited (a limited liability company
incorporated in Vietnam)
"Target Shares"	the total issued shares of each member of the Target Group
"USD"	United States dollars, the lawful currency of the United States of
America
"%"	per cent
Hong Kong, 12 June 2018

By Order of the Board

Man Wah Holdings Limited

Wong Man Li

Chairman

For the purpose of this announcement, the exchange rate at USD1.00 = HK$7.85 has been used, where applicable, for the purpose of illustration only and does not constitute a representation that any amounts were, may have been or will be exchanged at such rate or any other rates or at all.

As at the date of this announcement, the executive Directors are Mr. Wong Man Li, Ms. Hui Wai Hing, Mr. Alan Marnie, Mr. Dai Quanfa, Ms. Wong Ying Ying, and Mr. Tsang Hoi Lam; and the independent non-executive Directors are Mr. Chau Shing Yim, David, Mr. Ong Chor Wei, Mr. Kan Chung Nin, Tony and Mr. Ding Yuan.