CHINA GLASS HOLDINGS LIMITED

Transcription

1 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. CHINA GLASS HOLDINGS LIMITED * (Incorporated in Bermuda with limited liability) THE ACQUISITION (Stock Code: 3300) DISCLOSEABLE TRANSACTION ACQUISITION OF OLIVOTTO GLASS TECHNOLOGIES S.P.A. The Board is pleased to announce that on 27 September 2018 (after trading hours of the Stock Exchange), the Company (being the purchaser) and the Vendors entered into the Sale and Purchase Agreement, pursuant to which the Company has conditionally agreed to purchase and the Vendors have conditionally agreed to sell the Sale Shares, which represent the entire equity interest in the Target Company, at the Consideration of Euro 21,445,142 (equivalent to approximately HK$ million). Upon Completion, the Target Company will become a wholly-owned subsidiary of the Company and the subsequent financial result of the Target Group will be consolidated into the Group s consolidated financial statements. LISTING RULES IMPLICATIONS As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Acquisition exceed 5%, but are all less than 25%, the Acquisition constitutes a discloseable transaction of the Company under the Listing Rules and is therefore subject to the notification and announcement requirements but exempt from the shareholders approval requirement pursuant to Chapter 14 of the Listing Rules. 1

2 1. INTRODUCTION The Board is pleased to announce that that on 27 September 2018 (after trading hours of the Stock Exchange), the Company (being the purchaser) and the Vendors entered into the Sale and Purchase Agreement, pursuant to which the Company has conditionally agreed to purchase and the Vendors have conditionally agreed to sell the Sale Shares, which represent the entire equity interest in the Target Company at the Consideration of Euro 21,445,142 (equivalent to approximately HK$ million). 2. THE SALE AND PURCHASE AGREEMENT Date: 27 September 2018 (after trading hours of the Stock Exchange) Parties: (i) the Company (as the purchaser); and (ii) the Vendors The principal terms of the Sale and Purchase Agreement are summarised below. 2.1 Subject matter The Company has conditionally agreed to purchase and the Vendors have conditionally agreed to sell the Sale Shares, which represent the entire equity interest in the Target Company, on the terms as set out in the Sale and Purchase Agreement. 2

3 2.2 Consideration Subject to the terms and conditions of the Sale and Purchase Agreement, the Consideration is Euro 21,445,142 (equivalent to approximately HK$ million), which shall be settled in cash by the Company upon Completion under the mechanism summarized as follows: (a) as earnest money, the amount equal to Euro 5,000,000 (equivalent to approximately HK$45.89 million) shall be paid to the Vendors on 15 October 2018, out of which the parties agree that Euro 3,500,000 (equivalent to approximately HK$32.12 million) will be paid as an additional escrow amount (the Additional Escrow Amount ) in such terms as to be agreed between the Parties; (b) an escrow amount of Euro 1,500,000 (equivalent to approximately HK$13.77 million) (the Escrow Amount ) shall be paid to an escrow agent on the Closing Date or such other date as may be agreed by the Parties in accordance with an escrow agreement to be entered into between the Parties and the said escrow agent; and (c) the remaining part of the Consideration shall be paid to the Vendors on the Closing Date or such other date as may be agreed by the Parties. In the event that, after the Completion, the Company discovers any leakage of dividend, payment, fees or expenses as otherwise prescribed in the Sales and Purchase Agreement as of the Closing Date which has not been taken into account in determining the Consideration, the Company shall be entitled to make a leakage claim against the Vendors for such amount of leakage. 3

4 The Consideration was determined through arm s length negotiations between the Company and the Vendors with reference to a valuation report prepared by an independent and qualified valuer which determined a valuation of the Target Group of approximately Euro 22,900,000 (equivalent to approximately HK$ million). The valuation report applied the market comparable approach and having taken into account factors including the asset and know-how owned by the Target Group, the reputation of the Target Group in its industry sector and compared against other comparative companies in the market. The Board also consulted its financial adviser in relation to the valuation of the Target Group, which has considered the aforesaid valuation report and applied appropriate adjustments thereto with reference to the financial information, and the assets and debt positions of the Target Group as at 30 June Based on the foregoing, the Directors are of the view that the consideration is fair and reasonable. It is intended that the Consideration will be settled by internal resources of the Group and/or external financing(s) to be arranged before Completion should the Board considered appropriate. 2.3 Conditions precedent Completion of the Sale and Purchase Agreement is conditional upon the satisfaction (or waiver by the Company, if applicable) of certain Conditions as set out in the Sale and Purchase Agreement, amongst others: (a) the Company has issued an announcement on the Stock Exchange about the Acquisition, and complies with the relevant requirements of the Listing Rules; (b) the Vendors warranties are true, accurate and correct in all material respects as at the Closing Date; (c) the covenants and other obligations of the Vendors have been fully performed, complied or satisfied in all respects on or prior to the Closing Date; 4

5 (d) the receipt of a lender s release letter executed by a lender under a loan agreement with respect to the full release of the Target Group from any and all obligations and liabilities thereunder, and the full release of a pledge of the Sale Shares pursuant to the said loan agreement; and (e) the Parties have entered into escrow agreements in relation to the Escrow Amount and the Additional Escrow Amount. The Company is entitled to waive any of the above Conditions at its sole discretion (save for item (a) above). If any of the Conditions has not been satisfied or being waived on or before 30 November 2018, the Sale and Purchase Agreement shall automatically terminate and the Parties shall be released from all obligations thereunder, save for any antecedent breaches of the terms of the Sale and Purchase Agreement. 2.4 Completion Completion of the Acquisition shall, subject to the satisfaction (or waiver, as the case may be) of the Conditions, take place on 30 October 2018, or such other dates as the Parties may agree in writing. Upon Completion, the Target Company will become a wholly-owned subsidiary of the Company and the subsequent financial result of the Target Group will also be consolidated into the Group s consolidated financial statements. 3. INFORMATION OF THE RELEVANT PARTIES The Company and the Group The Company is an investment holding company. The Group is one of the leading manufacturers of flat glass in the PRC, specialises in the research and development, manufacturing and selling of a variety of building coated glass, energy-efficient and environmental friendly glass and new-energy products, in which it occupies a leading technological position. 5

6 The Vendors Star Capital is a joint stock company incorporated under the laws of Italy with limited liability and is the management company of a end-closed fund (the Fund ) which focuses on investments in Italian small and medium sized industrial companies. Star Capital is a leading Italian private equity firm which holds the equity interests of the Target Company in the name of the Fund and is represented by Mr. Gazzaniga in his capacity as the CEO and a managing director. Star Capital has been operating in the Italian private equity business since 2001 and has launched and managed four private equity funds. Industries is a financial holding company investing in industrial and real estate businesses. Mr. Gazzaniga is the CEO and a managing director of Star Capital and also a director of the Target Company. The entire equity interest of the Target Company is held by the Vendors prior to the Acquisition. As at the date of this announcement, to the best of the Directors knowledge, information and belief after having made all reasonable enquiries, the Vendors and their ultimate beneficial owner(s) are Independent Third Parties. 4. INFORMATION OF THE TARGET COMPANY 4.1 Information about the Target Company The Target Company is a joint stock company organised and existing under the laws of Italy with limited liability and is wholly owned by the Vendors at the date of this announcement. For more information about the Target Company, please see the section headed 5. Reasons for and benefits of the Acquisition set out below. 6

7 4.2 Financial information of the Target Group According to the consolidated financial information provided by the Vendors (prepared based on the Italian accounting standard and adjusted to the PRC generally accepted accounting principles), the consolidated net asset value of the Target Group as at 31 December 2017 was approximately Euro 9,040,000 (equivalent to approximately HK$82.96 million). Set out below is the consolidated financial information of the Target Group for the two financial years ended 31 December 2017 provided by each of the Vendors (which was prepared based on the Italian accounting standard and adjusted to the PRC generally accepted accounting principles): For the financial year ended 31 December 2016 Net profit before taxation Euro 506,753 (equivalent to approximately HK$4.65 million) Net profit after taxation Euro 528,220 (equivalent to approximately HK$4.85 million) For the financial year ended 31 December 2017 Euro 642,637 (equivalent to approximately HK$5.90 million) Euro 358,121 (equivalent to approximately HK$3.29 million) 5. REASONS FOR AND BENEFITS OF THE ACQUISITION As at the date of this announcement, the Group specialises in the research and development, manufacturing and selling of a variety of building coated glass, energy-efficient and environmental friendly glass and new-energy glass products. The Group continues to explore appropriate opportunities for different investment projects, to expand the industry chain and optimise the industry exposure, with a view to maximize the return to the Company and its shareholders in the long run. 7

8 The Target Group is a manufacturer of glass production equipment. The majority of the equipment is produced for the use in the production of neutral medicinal glass, daily-use glass and mineral wool. In the industry of the manufacturing of the glass equipment, the Target Group is one of the world leaders in glass tubing technology, and a global core supplier of the equipment for manufacturing neutral medicinal glass products. It is also one of the leading companies in the industry that is capable of providing a full range of equipment for the entire hollow glass industry. While the downstream of medicinal glass equipment is the manufacturers of medicinal glass, the medicinal glass packaging containers produced by them are mainly used in the pharmaceutical industry. The development of the pharmaceutical industry is therefore crucial for the upstream equipment. Given that the pharmaceutical industry is one of the key industries in the world, it is expected that the PRC will be one of the key growth drivers and the acquisition of the Target Group is significant to domestic manufacturers of neutral medicinal glass. The Company is of the view that the sharing of technologies and resources amongst members of the Group will be greatly facilitated upon Completion. Accordingly, the Board considers the Acquisition is beneficial to and in the interest of the Group and its Shareholders as a whole. 6. LISTING RULES IMPLICATIONS As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Acquisition exceed 5% but are all less than 25%, the Acquisition constitutes a discloseable transaction of the Company under the Listing Rules and is therefore subject to the notification and announcement requirements but exempt from the shareholders approval requirement pursuant to Chapter 14 of the Listing Rules. 8

9 DEFINITIONS In this announcement, unless the context otherwise requires, the following terms shall have the following meanings when used herein: Acquisition the acquisition of the Target Company by the Company from the Vendors pursuant to the Sale and Purchase Agreement Board the board of Directors Business Day any calendar day other than Saturdays and Sundays in which the banks are normally open for commercial activities in Hong Kong, Beijing (PRC), Milan (Italy) and the jurisdiction where a nominee designated by the Company to take up the Sale Shares is incorporated Closing Date the date on which the Completion shall take place pursuant to the Sale and Purchase Agreement Company China Glass Holdings Limited (Stock Code: 3300), a company incorporated under the Laws of Bermuda with limited liability and the Shares of which are listed on the main board of the Stock Exchange Completion the completion of the sale and purchase of the Sale Shares pursuant to the Sale and Purchase Agreement Conditions the conditions precedent pursuant to the Sale and Purchase Agreement Consideration Euro 21,445,142 (equivalent to approximately HK$ million), being the consideration of the Acquisition Directors the director(s) of the Company 9

10 Euro the lawful currency of the member states of the European Union that adopted the single currency in accordance with the Treaty on the Functioning of the European Union Group the Company and its subsidiaries HK$ Hong Kong dollars, the lawful currency of Hong Kong Hong Kong the Hong Kong Special Administrative Region of the PRC Independent Third Party(ies) a party(ies) who is/are not connected person(s) (as defined in the Listing Rules) of the Company and is/are third party(ies) independent of the Company and the connected persons (as defined in the Listing Rules) of the Company Industries Industries S.R.L., a company incorporated under the Laws of Italy with limited liability, being a Vendor Listing Rules the Rules Governing the Listing of Securities on the Stock Exchange Mr. Gazzaniga Mr. Marco Gazzaniga, an Italian citizen, being a Vendor Party(ies) collectively the Company and the Vendors PRC The People s Republic of China (excluding, for the purpose of this announcement, Hong Kong, Macau Special Administrative Region of the PRC and Taiwan) 10

11 Sale and Purchase Agreement the sale and purchase agreement dated 27 September 2018 entered into between the Company as purchaser and the Vendors as vendors in relation to the Acquisition Sale Shares 1,408,000 ordinary shares with par value of Euro 1 each, representing 100% of the issued share capital of the Target Company owned by the Vendors and, in particular, by Star Capital (998,019 shares, representing 70.88% of the Sale Shares), Industries (400,000 shares, representing 28.41% of the Sale Shares) and Mr. Gazzaniga (9,981 shares, representing 0.71% of the Sale Shares) Shareholders holders of the Share(s) of the Company from time to time Share(s) ordinary share(s) of HK$0.05 each in the issued share capital of the Company Star Capital Star Capital SGR S.p.A., a joint stock company incorporated under the Laws of Italy with limited liability, being a Vendor Stock Exchange The Stock Exchange of Hong Kong Limited Target Company Olivotto Glass Technologies S.p.A., a joint stock company incorporated under the Laws of Italy with limited liability Target Group the Target Company and its subsidiaries Vendors collectively Star Capital, Industries and Mr. Gazzaniga % per cent 11

12 In this announcement, unless the context requires otherwise, the terms associate(s), connected person(s), connected transaction(s), percentage ratio(s), substantial shareholder(s) and subsidiary(ies), shall have the meaning given to such terms in the Listing Rules. By Order of the Board China Glass Holdings Limited Cui Xiangdong Chief Executive Officer Hong Kong, 27 September 2018 As at the date of this announcement, the directors of the Company are as follows: Executive director: Mr. Cui Xiangdong (Chief Executive Officer) Non-executive directors: Mr. Peng Shou (Chairman); Mr. Zhao John Huan; Mr. Zhou Cheng (Honorary Chairman); and Mr. Zhang Jinshu Independent non-executive directors: Mr. Zhang Baiheng; Mr. Zhao Lihua; and Mr. Chen Huachen * For identification purpose only 12