Chen Hsong : DISCLOSEABLE TRANSACTION - DISPOSAL OF PROPERTY

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 Bermuda with limited liability)

(Stock Code: 00057)

DISCLOSEABLE TRANSACTION

DISPOSAL OF PROPERTY

The Board announces that after trading hours on 18 December 2019, the Vendor, an indirect wholly-owned subsidiary of the Company, entered into the SP Agreement with the Purchaser, an Independent Third Party, to dispose of the Property at an aggregate consideration of NTD870,000,000 (equivalent to approximately HK$224,634,000).

As the highest applicable percentage ratio (as defined in the Listing Rules) in respect of the Disposal is more than 5% but less than 25%, the Disposal constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules and is therefore subject to the notification and announcement requirements under the Listing Rules.

THE DISPOSAL

The Board announces that after trading hours on 18 December 2019 (after trading hours), the Vendor entered into the SP Agreement with the Purchaser to dispose of the Property at an aggregate consideration of NTD870,000,000 (equivalent to approximately HK$224,634,000), the principal terms of which are set out below.

THE SP AGREEMENT

Date	: 18 December 2019.

Purchaser: : An individual who, to the best of the Directors' knowledge, information and belief having made all reasonable enquiry, is an Independent Third Party.

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Vendor	: Chen Hsong Machinery Taiwan Co., Ltd.* (震雄機械廠股份有限
	公司), a company incorporated in Taiwan with limited liability
	and an indirect wholly-owned subsidiary of the Company, which
	principally engages in manufacture and sale of plastic injection
	moulding machines.
Property	: The site comprising the parcels of land marked Lot Nos. 562, 574
	- 584 and 587 in Hong Chang, Lujhu, Taiwan with a total site area
	of approximately 4,347.53 Ping (坪) (equivalent to approximately
	14,372.01 square metres), together with the industrial complexes
	erected thereon with a total floor area of approximately 14,809.76
	square metres.
Consideration	: NTD870,000,000 (equivalent to approximately HK$224,634,000)
	in cash, which shall be payable as follows:
	(1) first installment: NTD87,000,000 payable within 7 days
	after signing of the SP Agreement;
	(2) second installment: NTD87,000,000 payable within 7 days
	after the Vendor has completed the soil improvement and
	acquired the notice of satisfactory inspection from the
	relevant environmental protection authority;
	(3) third installment: NTD87,000,000 payable within 7 days
	upon issuance of the value-added tax invoice; and
	(4) final payment: NTD609,000,000 payable within 3 days upon
	completion of the registration of transfer of ownership of
	the Property.
	The Consideration was arrived at after arm's length negotiation
	between the Vendor and the Purchaser having considered, among
	other things, the market value of the relevant properties in the
	vicinity region.

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Completion	: Completion shall take place within 7 days after the final payment
	by the Purchaser but in any event no later than 31 March 2020 (or
	such other date as agreed in writing by the parties). Under the
	terms of the SP Agreement, the Purchaser may designate a
	nominee to be the registered obligee of the transfer of the
	Property but such nominee designated by the Purchaser shall be
	jointly and severally liable with the Purchaser for all matters
	arising from the performance of the SP Agreement and shall abide
	by the provisions thereof.

Information of the Property

The Property was utilised by the Group for its own production of plastic injection moulding machines. As such, no rental incomes were attributable to the Property. The net book values of the Property as at 31 March 2018 and 31 March 2019 were approximately HK$78 million and HK$74 million respectively. The unaudited net book value of the Property as at 30 November 2019 was approximately HK$74 million.

REASONS FOR AND BENEFITS OF THE DISPOSAL

The Group principally engages in manufacture and sale of plastic injection moulding machines and related products.

The Property was utilised by the Group for its own production of plastic injection moulding machines. The Property shall not be necessary for the Group's future operations as its two production facilities in Taiwan are expected to merge into one single plant. The Directors consider that the Disposal provides an opportunity for the Company to realise the investment value of its assets and to provide additional working capital for the Company and is in the best interest of the Company and its shareholders as a whole.

The terms of the SP Agreement were determined after arm's length negotiations between the parties thereto and are on normal commercial terms. The Directors consider that the terms of the SP Agreement (including the Consideration) are on normal commercial terms and are fair and reasonable, and that the Disposal is in the interests of the Company and the Shareholders as a whole.

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The Disposal is expected to enable the Group to recognise an unaudited gain of approximately HK$151 million, being the difference between the Consideration over the carrying value of the Property before any expenses and tax. The actual gain or loss as a result of the Disposal to be recorded by the Group is subject to audit and will be determined as at the date of the Completion. The net proceeds from the Disposal after deducting relevant costs and expenses (before tax), estimated to be approximately HK$220 million, are intended to be applied for general working capital of the Group.

IMPLICATIONS UNDER THE LISTING RULES

As the highest applicable percentage ratio (as defined in the Listing Rules) in respect of the Disposal is more than 5% but less than 25%, the Disposal constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules and is therefore subject to the notification and announcement requirements under the Listing Rules.

DEFINITIONS

In this announcement, the following expressions have the meanings set out below unless the context requires otherwise:

"Board"	the board of Directors
"Company"	Chen Hsong Holdings Limited, an exempted company
	incorporated in Bermuda with limited liability, the Shares of
	which are listed on the Main Board of the Stock Exchange
	(Stock code: 00057)
"Completion"	the completion of the Disposal by way of handover of the
	Property
"connected person"	has the meaning ascribed to it under the Listing Rules
"Consideration"	NTD870,000,000 (equivalent to approximately
	HK$224,634,000) in cash, being the total consideration
	payable by the Purchaser to the Vendor for the Disposal
"Director(s)"	the director(s) of the Company
"Disposal"	the disposal of the Property by the Vendor pursuant to the SP
	Agreement
"Group"	the Company and its subsidiaries

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"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"Hong Kong"	the Hong Kong Special Administrative Region of the
	People's Republic of China
"Independent Third Party"	a third party independent of the Company and the connected
	persons of the Company
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock
	Exchange
"NTD"	New Taiwan Dollar, the lawful currency of Taiwan
"Property"	The site comprising the parcels of land marked Lot Nos.
	562, 574 - 584 and 587 in Hong Chang, Lujhu, Taiwan with
	a total site area of approximately 4,347.53 Ping (坪)
	(equivalent to approximately 14,372.01 square metres),
	together with the industrial complexes erected thereon with
	a total floor area of approximately 14,809.76 square metres
"Purchaser"	黃正祥 (Huang, Cheng Hsiang), an individual who is an
	Independent Third Party
"SP Agreement"	the sale and purchase contract of real estate dated
	18 December 2019 entered into between the Vendor and the
	Purchaser for the sale and purchase of the Property
"Share(s)"	ordinary share(s) of HK$0.10 each in the capital of the
	Company
"Shareholder(s)"	holder(s) of the Share(s)
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Vendor"	Chen Hsong Machinery Taiwan Co., Ltd.* (震雄機械廠股份
	有限公司), a company incorporated in Taiwan with limited
	liability and an indirect wholly-owned subsidiary of the
	Company
"%"	per cent.

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In this announcement, amounts quoted in NTD have been converted into HK$ at a rate of NTD1.00 to HK$0.2582. Such exchange rate has been used, where applicable, for the purposes of illustration only and does not constitute a representation that any amounts were or may have been exchanged at this or any other rates at all.

By Order of the Board

CHEN HSONG HOLDINGS LIMITED

Lai Yuen CHIANG

Chairman and Chief Executive Officer

Hong Kong, 18 December 2019

As at the date of this announcement, the executive directors of the Company are Ms. Lai Yuen CHIANG and Mr. Stephen Hau Leung CHUNG, and the independent non-executive directors of the Company are Mr. Bernard Charnwut CHAN, Mr. Anish LALVANI, Mr. Michael Tze Hau LEE and Mr. Johnson Chin Kwang TAN.

• For identification purposes only

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