CONNECTED TRANSACTION ACQUISITION OF ASSETS

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. FIT Hon Teng Limited (Incorporated in the Cayman Islands with limited liability under the name Foxconn Interconnect Technology Limited and carrying on business in Hong Kong as FIT Hon Teng Limited) (Stock code: 6088) CONNECTED TRANSACTION ACQUISITION OF ASSETS ASSETS PURCHASE AGREEMENT The Board is pleased to announce that on July 30, 2018, CHN Sub entered into the Assets Purchase Agreement with WSEC pursuant to which WSEC agreed to sell, and CHN Sub agreed to acquire, the Target Assets at a consideration of JPY400,000,000. LISTING RULES IMPLICATIONS As of the date of this announcement, the Company is indirectly owned as to approximately 76.92% by Hon Hai, the controlling shareholder of the Company, which controls more than 30% interest in Sharp. Sharp and its subsidiaries are therefore associates of Hon Hai and connected persons of the Company. Accordingly, the Acquisition constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. As the highest of all the applicable percentage ratios (as defined under Rule of the Listing Rules) in respect of the Acquisition are more than 0.1% but less than 5%, the Acquisition is exempt from the circular (including independent financial advice) and independent shareholders approval requirements, but subject to the reporting, announcement and annual review requirements under Chapter 14A of the Listing Rules. Reference is made to the announcement made by the Company on February 7, 2018 with respect to the formation of the JV Company between the Group and Sharp. The Board is pleased to announce that on July 30, 2018, CHN Sub entered into the Assets Purchase Agreement with WSEC pursuant to which WSEC agreed to sell, and CHN Sub agreed to acquire, the Target Assets. 1

2 MAJOR TERMS OF THE ASSETS PURCHASE AGREEMENT Date July 30, 2018 Parties (i) CHN Sub, a non-wholly owned subsidiary of the Company; and (ii) WSEC, a connected person of the Company. Assets agreed to be acquired The Target Assets Consideration The consideration for the Acquisition is JPY400,000,000 (equivalent to approximately RMB24,400,000), subject to downward adjustment in case of reduction in Target Assets before or at Completion, which was agreed after arm s length negotiations between CHN Sub and WSEC taking into account the valuation of the Target Assets under the Valuation Report. Conditions precedent Prior to Completion, CHN Sub shall use reasonable best effort to acquire all necessary regulatory approval for its legal operations in the PRC and adequate logistical support in the PRC, including without limitation the approval of a capital injection for the Acquisition to CHN Sub by the Investment Commission of the Ministry of Economic Affairs of Taiwan. Completion and payment terms Completion shall take place within one business day from the completion of the conditions under the section headed Conditions precedent of this announcement, or such other date as CHN Sub and WSEC may agree in writing (the Completion Date ). Within 5 business days from the Completion Date, CHN Sub shall complete the inspection of the Target Assets and provide an inspection report to WSEC. The consideration for the Acquisition will be paid in cash in RMB on the later of (i) 15 calendar days after the inspection report is accepted; or (ii) 60 calendar days after the approval of a capital injection for the Acquisition to CHN Sub by the Investment Commission of the Ministry of Economic Affairs of Taiwan. 2

3 INFORMATION ON THE TARGET ASSETS The Target Assets comprise certain assets of WSEC s vehicle camera and electronic mirror technology business. The unaudited book value of the Target Assets as of March 31, 2018 based on the management accounts of WSEC was RMB14,544, The original acquisition cost of the Target Assets to WSEC was RMB66,594, According to the Valuation Report issued by Kunshan Zhongxin Asset Appraisal Firm, an independent registered PRC valuer, the appraisal value of the Target Assets as of May 31, 2018 was RMB26,979, The net profit before and after tax and extraordinary items attributable to the Target Assets for the two financial years ended December 31, 2016 and 2017 are as follows: For the year ended December 31, 2016 (RMB 000) For the year ended December 31, 2017 (RMB 000) Net profit before tax and extraordinary items 13,380 23,542 Net profit after tax and extraordinary items 10,981 16,983 INFORMATION ON THE PARTIES The Group is a leading global interconnect solutions provider and one of the few global interconnect solutions providers whose offerings span wire-based, fiber-based and wireless interconnect solutions. WSEC is a limited liability company established in the PRC and is a non-wholly owned subsidiary of Sharp. It is principally engaged in the development and production, wholesale, commission agency (excluding auction), import and export of liquid crystal display devices and accessories, laser pickups and accessories and digital camera key components, etc. REASONS FOR AND BENEFITS OF ENTERING INTO ASSETS PURCHASE AGREEMENT As set out in the previous announcement of the Company dated February 7, 2018, in recent years, the automotive industry has been investing heavily in the research and development of autonomous driving, which is considered to be the future of road transport. While fully driverless vehicles are unlikely to be commercially available in the short term, automobile manufacturers are already equipping their products with advanced driver assistance systems (ADAS), of which automotive cameras and electronic mirrors are indispensable hardware components. For further reasons and benefit in setting up the JV Company, please refer to the previous announcement of the Company dated February 7,

4 As contemplated under the Joint Venture Agreement, the Acquisition is a concrete step further to realize the parties business intent under the Joint Venture Agreement. Taking into account the above reasons and the terms of the Assets Purchase Agreement, all Directors (including the independent non-executive Directors) are of the view that (i) the terms of the Assets Purchase Agreement are fair and reasonable; (ii) the Acquisition is on normal commercial terms or better and in the ordinary and usual course of business of the Group; and (iii) the Acquisition is in the interests of the Company and the shareholders of the Company as a whole. None of the Directors (including the independent non-executive Directors) has a material interest in the Assets Purchase Agreement, and none of the Directors has abstained from voting on the relevant board resolutions. LISTING RULES IMPLICATIONS As of the date of this announcement, the Company is indirectly owned as to approximately 76.92% by Hon Hai, the controlling shareholder of the Company, which controls more than 30% interest in Sharp. Sharp and its subsidiaries are therefore associates of Hon Hai and connected persons of the Company. Accordingly, the Acquisition constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. As the highest of all the applicable percentage ratios (as defined under Rule of the Listing Rules) in respect of the Acquisition are more than 0.1% but less than 5%, the Acquisition is exempt from the circular (including independent financial advice) and independent shareholders approval requirements, but subject to the reporting, announcement and annual review requirements under Chapter 14A of the Listing Rules. As the Completion is subject to the satisfaction of the conditions precedent stated in the Assets Purchase Agreement, the Acquisition may or may not proceed to completion. Accordingly, shareholders and potential investors of the Company should exercise caution when dealing in the securities of the Company. DEFINITIONS Acquisition Assets Purchase Agreement associate Board the transaction contemplated under the Assets Purchase Agreement; the assets purchase agreement, dated July 30, 2018, entered into between CHN Sub and WSEC, as further described in the section headed Major Terms of the Assets Purchase Agreement ; the board of Directors of the Company; 4

5 Company Completion connected person connected transaction(s) CHN Sub controlling shareholder Directors Group HK$ Hon Hai Hong Kong Joint Venture Agreement JPY JV Company Listing Rules PRC RMB FIT Hon Teng Limited ( 鴻騰六零八八精密科技股份有限公司 ), a company incorporated in the Cayman Islands with limited liability under the name Foxconn Interconnect Technology Limited and carrying on business in Hong Kong as FIT Hon Teng Limited, the shares of which are listed on the Main Board of the Stock Exchange (Stock Code: 6088.HK); the completion of the Acquisition; SHARP FIT Automotive Technology (Wuxi) Co, Ltd. ( 騰夏汽車科技 ( 無錫 ) 有限公司 ), a limited liability company incorporated in the PRC which is a wholly-owned subsidiary of the JV Company; directors of the Company; the Company and its subsidiaries; Hong Kong dollar(s), the lawful currency of Hong Kong; Hon Hai Precision Industry Co., Ltd. ( 鴻海精密工業股份有限公司 ), a limited liability company established in Taiwan and listed on the Taiwan Stock Exchange (Stock Code: 2317.TW), the controlling shareholder of the Company; the Hong Kong Special Administrative Region of the People s Republic of China; the joint venture agreement, dated February 7, 2018, entered into among Foxconn Interconnect Technology Singapore Pte. Ltd., Foxconn Optical Interconnect Technologies Singapore Pte. Ltd. and Sharp, as further described in the announcement of the Company dated February 7, 2018; Japanese yen, the lawful currency of Japan; FIT Electronics Device Pte. Ltd., a limited liability company established in Singapore which is owned as to 51% by the Company and as to 49% by Sharp as of the date of this announcement; the Rules Governing the Listing of Securities on the Stock Exchange; the People s Republic of China, which for the purpose of this announcement does not include Hong Kong, the Macau Special Administrative Region of the People s Republic of China and Taiwan; renminbi, the lawful currency of the PRC; 5

6 Share(s) Sharp Stock Exchange subsidiary(ies) Target Assets Valuation Report US$ WSEC ordinary share(s) with nominal value of US$ each in the issued capital of the Company or if there has been a subsequent subdivision, consolidation, reclassification or reconstruction of the share capital of the Company, shares forming part of the ordinary equity share capital of the Company; Sharp Corporation ( シャープ株式會社 ), a limited liability company registered in Japan, the shares of which are listed on the First Section of the Tokyo Stock Exchange, Inc. (Stock Code: 6753.T); The Stock Exchange of Hong Kong Limited; certain assets of WSEC s vehicle camera and electronic mirror technology business, a list of which is set out in the Assets Purchase Agreement; the valuation report relating to the valuation of the Target Assets dated June 12, 2018 (KZXPB (2018) No.146) ( 昆眾信評報字 (2018) 第 146 號 ), issued by Kunshan Zhongxin Asset Appraisal Firm ( 昆山眾信資產評估事務所 ), an independent registered PRC valuer; United States dollar(s), the lawful currency of the United States; Wuxi Sharp Electronic Components Co., Ltd. ( 無錫夏普電子元器件有限公司 ), a limited liability company incorporated in the PRC which is owned as to 80% by Sharp and 20% by Wuxi Electronics & Instruments Industry Co., Ltd. ( 無錫電子儀表工業公司 ) as of the date of this announcement; and % percent. By order of the Board FIT Hon Teng Limited* LU Sung-Ching Chairman of the Board Hong Kong, July 30, 2018 For the purpose of this announcement, unless the context otherwise requires, the conversion of JPY into RMB is based on the approximate exchange rate of JPY1 to RMB Such exchange rate is for the purpose of illustration only and does not constitute a representation that any amounts in JPY and RMB have been, could have been or may be converted at such or any other rate or at all. As of the date of this announcement, the Board comprises Mr. LU Sung-Ching, Mr. LU Pochin Christopher and Mr. GILLESPIE William Ralph as executive Directors, Dr. CHEN Ga-Lane as non-executive Director, and Mr. CURWEN Peter D, Mr. TANG Kwai Chang and Mr. CHAN Wing Yuen Hubert as independent non-executive Directors. * Incorporated in the Cayman Islands with limited liability under the name Foxconn Interconnect Technology Limited and carrying on business in Hong Kong as FIT Hon Teng Limited 6