BLUE RIVER 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.
PYI Corporation Limited(Incorporated in Bermuda with limited liability)
(Stock code: 498) DISCLOSEABLE TRANSACTION FORMATION OF JOINT VENTURE FORMATION OF JOINT VENTUREThe Board is pleased to announce that on 29 November 2016 (after trading hours), Xinghua, an indirect wholly-owned subsidiary of the Company, and the JV Partner entered into the JV Agreement pursuant to which the JV Parties agreed to establish the JV Company to construct and develop an integrated recreation project in Xiao Yangkou of Rudong County, Nantong City, Jiangsu Province, the PRC.
Pursuant to the JV Agreement, the registered capital of the JV Company shall be USD10,000,000 (equivalent to approximately HK$78,000,000). Xinghua and the JV Partner shall make a capital contribution of USD7,500,000 (equivalent to approximately HK$58,500,000) and USD2,500,000 (equivalent to approximately HK$19,500,000), respectively, to the registered capital of the JV Company. The JV Company will be owned as to 75% by Xinghua and will become an indirect non wholly-owned subsidiary of the Company.
LISTING RULES IMPLICATIONAs one or more of the applicable percentage ratios exceeds 5% and all of the percentage ratios are less than 25%, the investment in the JV Company pursuant to the JV Agreement constitutes a discloseable transaction for the Company and is subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.
INTRODUCTIONThe Board is pleased to announce that on 29 November 2016 (after trading hours), Xinghua, an indirect wholly-owned subsidiary of the Company, and the JV Partner entered into the JV Agreement pursuant to which the JV Parties agreed to establish the JV Company to construct and develop an integrated recreation project in Xiao Yangkou of Rudong County, Nantong City, Jiangsu Province, the PRC.
The principal terms of the JV Agreement are set out below.
THE JV AGREEMENTDate: 29 November 2016
Parties: | 1. | Xinghua |
2. | JV Partner |
To the best of the Directors' knowledge, information and belief and after making reasonable enquiries, the JV Partner and its ultimate beneficial owner(s) are third parties independent of the Company and its connected person(s).
Subject MatterThe JV Company will be a limited liability company to be established in accordance with the laws of the PRC and the provisions of the JV Agreement.
The proposed name of the JV Company is 江蘇小洋口溫泉開發有限公司 (Jiangsu Xiaoyangkou Hot Spring Development Co., Ltd.).
The term of the JV Company shall be fifty (50) years from the date of issue of the business licence of the JV Company, where such period may be extended subject to the unanimous consent of the JV Parties and applicable laws and regulations.
Purpose of the JV CompanyThe principal objective of the JV Company is to construct and develop an integrated recreation project in Xiao Yangkou of Rudong County, Nantong City, Jiangsu Province, the PRC, to add recreational element to the hot spring resort development in Xiao Yangkou.
Capital ContributionPursuant to the JV Agreement, the registered capital of the JV Company shall be USD10,000,000 (equivalent to approximately HK$78,000,000). Xinghua and the JV Partner shall make a capital contribution of USD7,500,000 (equivalent to approximately HK$58,500,000) and USD2,500,000 (equivalent to approximately HK$19,500,000), respectively, to the registered capital of the JV Company. The JV Company will be owned as to 75% by Xinghua and will become an indirect non wholly-owned subsidiary of the Company.
The JV Parties shall make their respective capital contribution in cash within ten (10) years from the date of establishment of the JV Company. Such capital contribution shall be payable in instalments, the first instalment of USD6,670,000 (equivalent to approximately HK$52,026,000) (being 66.7% of the total contribution) shall be payable within one (1) year from the date of establishment of the JV Company, by Xinghua (in the sum of USD5,000,000) (equivalent to approximately HK$39,000,000) and the JV Partner (in the sum of USD1,670,000) (equivalent to approximately HK$13,026,000) respectively. The payment schedule of the remaining balance of the contribution shall be determined by reference to the need of the JV Company.
The amount of capital contribution was determined after arm's length negotiations between the JV Parties with reference to the initial capital requirement of the JV Company.
The Group intends to finance its investment in the JV Company from its internal resources.
In the event that a shareholder of the JV Company proposes to transfer the whole or part of its equity interest in the JV Company, the other shareholder of the JV Company shall have a right of first refusal of such transfer.
Composition of the board of directors of the JV CompanyPursuant to the JV Agreement, the board of directors of the JV Company will comprise ten (10) directors, seven (7) of whom will be appointed by Xinghua. The chairman of the board of directors of the JV Company will be appointed by the JV Partner. The vice chairman of the board of directors of the JV Company will be appointed by Xinghua.
INFORMATION OF THE GROUPThe Group is principally engaged in ports and infrastructure development and investment, the operation of ports and logistics facilities, land and property development and investment in association with ports and infrastructure development, treasury investment and provision of comprehensive engineering and property-related services through its direct and indirect interests in Paul Y. Engineering Group Limited.
In relation to the Group's business in Xiao Yangkou, as contained in the Business Review of the 2016 Annual Report of the Company, the Group has 11.5 square kilometres land bank situated at Xiao Yangkou, which is under development as a regional tourism site of national standard with hotspring and recreational facilities.
INFORMATION OF THE JV PARTNERThe JV Partner is principally engaged in development and investment of infrastructure and property, the operation and management of tourist attraction sites in the PRC.
REASONS FOR AND BENEFITS OF THE TRANSACTIONThe Board considers that the Project can be sustainable. In addition, the Project which will be located within the 11.5 square kilometres land bank situated at Xiao Yangkou of the Group can add value to the aforesaid land bank upon successful implementation of the Project. In this connection, the Board considers that the entering into of the JV Agreement and the operation of the JV Company is a valuable opportunity for the Group to expand its business in Nantong City and, in particular, Xiao Yangkou, which is an important strategic location of the Group's Yangtze Strategy.
The terms of the JV Agreement are determined after arm's length negotiations. The Directors are of the view that the terms of the JV Agreement are fair and reasonable and are in the interests of the Company and the Shareholders as a whole.
LISTING RULES IMPLICATIONAs one or more of the applicable percentage ratios exceeds 5% and all of the percentage ratios are less than 25%, the investment in the JV Company pursuant to the JV Agreement constitutes a discloseable transaction for the Company and is subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.
DEFINITIONSIn this announcement, the following terms have the meanings set out below:
"Board" | the board of Directors |
"Company" | PYI Corporation Limited, a company incorporated in Bermuda with limited liability and the issued securities of which are listed on the Main Board of the Stock Exchange |
"connected person(s)" | has the meaning ascribed to it under the Listing Rules |
"Director(s)" | the director(s) of the Company |
"Group" | the Company and its subsidiaries |
"Hong Kong" | the Hong Kong Special Administrative Region of the PRC |
"HK$" | Hong Kong dollars, the lawful currency of Hong Kong |
"JV Agreement" | the joint venture agreement dated 29 November 2016 entered into between Xinghua and the JV Partner in relation to the formation and management of the JV Company |
"JV Company" | a joint venture company proposed to be named 江蘇小洋口溫泉 開發有限公司 (Jiangsu Xiaoyangkou Hot Spring Development Co., Ltd.) and to be established in the PRC, pursuant to the law of the PRC and provisions of the JV Agreement |
"JV Parties" | the parties to the JV Agreement, namely, Xinghua and the JV Partner |
"JV Partner" | 南通金蛤島投資發展有限公司 (Nantong Gold Clam Island Investment Development Company Limited*), a state-owned limited liability company established in the PRC |
"Listing Rules" | the Rules Governing the Listing of Securities on the Stock Exchange |
PYI Corporation Ltd. published this content on 29 November 2016 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 29 November 2016 15:38:07 UTC.
Original documenthttp://www.pyicorp.com/pyiCms/documentLibrary/e_29-11-2016_Announcement on discloseable transaction.pdf
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