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Best Pacific International Holdings Limited

超盈國際控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2111)
  1. DISCLOSEABLE TRANSACTION IN RELATION TO ACQUISITION OF 51% OF THE ENTIRE ISSUED SHARE CAPITAL OF TRISCHEL FABRIC (PRIVATE) LIMITED
  2. POTENTIAL CONTINUING CONNECTED TRANSACTION IN RELATION TO THE FRAMEWORK AGREEMENT AND
  3. POTENTIAL CONTINUING CONNECTED TRANSACTIONS PURSUANT TO RULE 14A.60(1) OF THE LISTING RULES THE ACQUISITION

    The Board is pleased to announce that on 4 December 2017 (after trading hours), BPSL (Thulhiriya), an indirect wholly-owned subsidiary of the Company, the JV Partner and the JV Company entered into the JV Agreement, pursuant to which (i) BPSL (Thulhiriya) has conditionally agreed to purchase and acquire from the JV Partner, and the JV Partner has conditionally agreed to sell and transfer to BPSL (Thulhiriya), the Sale Shares at the Consideration; and (ii) BPSL (Thulhiriya) and the JV Partner agreed to, amongst other things, regulate the ownership, funding and management of the JV Company on the terms and conditions as set out in the JV Agreement. As at the date of this announcement, the JV Company is owned as to 100% by the JV Partner. Upon completion of the Acquisition, the JV Company will be held as to 51% by BPSL (Thulhiriya) and as to 49% by the JV Partner.

    THE FRAMEWORK AGREEMENT

    Upon completion of the Acquisition, the JV Company will be held as to 51% by BPSL (Thulhiriya) and as to 49% by the JV Partner. Accordingly, members of the MAS Group (including the JV Partner) will become connected persons of the Company at the subsidiary level under Rule 14A.06(9) of the Listing Rules.

    The BPTHL Group currently sells, and will continue to sell, the Products to the MAS Group. Such transactions between the BPTHL Group and the MAS Group will, upon completion of the Acquisition, become continuing connected transactions for the Company under Chapter 14A of the Listing Rules. Against this background, simultaneous with the execution of the JV Agreement, BPTHL and the JV Partner entered into the Framework Agreement for a term of three years commencing on the Effective Date in respect of such transactions. BPTHL and the JV Partner may mutually agree in writing no less than three months prior to the expiration of the term of the Framework Agreement to renew the Framework Agreement on the same terms and conditions for a further term of three years, subject to compliance with the then applicable requirements of the Listing Rules and provided that the Annual Caps mentioned in the Framework Agreement may be adjusted at the request of BPTHL and by mutual agreement between BPTHL and the JV Partner.

    LISTING RULES IMPLICATIONS The JV Agreement

    As one or more of the applicable percentage ratios (as defined in the Listing Rules) in respect of the Acquisition contemplated under the JV Agreement exceeds 5% and all of them are less than 25%, the entering into of 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.

    The Framework Agreement

    Upon completion of the Acquisition, the JV Company will be held as to 51% by BPSL (Thulhiriya) and as to 49% by the JV Partner. Accordingly, members of the MAS Group (including the JV Partner) will become connected persons of the Company at the subsidiary level under Rule 14A.06(9) of the Listing Rules and the transactions contemplated under the Framework Agreement will constitute continuing connected transactions for the Company under Chapter 14A of the Listing Rules.

    As (i) the Board has approved the Framework Agreement; and (ii) the independent non-executive Directors have confirmed that the terms of the Framework Agreement are fair and reasonable, on normal commercial terms and in the interests of the Company and the Shareholders as a whole, the Framework Agreement is subject to the reporting, announcement and annual review requirements, but is exempted from the circular, independent financial advice and shareholders' approval requirements pursuant to Rule 14A.101 of the Listing Rules.

    The CCT Agreements and the Arrangements

    Further, upon completion of the Acquisition, each of MAS Fabric Park, MAS Fabrics, MAS Innovations and MAS Legato, all being direct or indirect wholly-owned subsidiaries of MAS Holdings, the direct holding company of the JV Partner, will also become a connected person of the Company at the subsidiary level under Rule 14A.06(9) of the Listing Rules.

    Prior to the date of execution of the JV Agreement, (i) MAS Fabric Park entered into three agreements with the JV Company, namely (1) the Sub-Lease Agreement regarding the sub-letting of the Land by MAS Fabric Park to the JV Company; (2) the Services Agreement regarding the provision of certain utility services by MAS Fabric Park to the JV Company; (3) the MOU regarding the provision of services in relation to a biomass thermic oil heater by MAS Fabric Park to the JV Company; (ii) the JV Partner entered into the Master Services Agreement with the JV Company for the JV Partner to provide assistance services and advice in relation to the operation of the JV Company; and (iii) the JV Company has made the Arrangements with three subsidiaries of MAS Holdings, namely, MAS Fabrics, MAS Innovations and MAS Legato, respectively, pursuant to which MAS Fabrics, MAS Innovations and MAS Legato shall provide the Shared Services to the JV Company. If the Company is of the view that the Arrangements are necessary for the operations of the JV Group after the completion of the Acquisition, the JV Company (or any member of the Company) will, on or prior to completion of the Acquisition, enter into written agreements with each of MAS Fabrics, MAS Innovations and MAS Legato with respect to the Arrangements.

    Upon completion of the Acquisition, the transactions contemplated under the above CCT Agreements and the Arrangements will become continuing connected transactions for the Company under Chapter 14A of the Listing Rules. Pursuant to Rule 14A.60(1) of the Listing Rules, the Company is required to comply with the annual review and disclosure requirements under Chapter 14A of the Listing Rules regarding the continuing connected transactions under the CCT Agreements and the Arrangements. The Company will comply in full with all applicable requirements under Chapter 14A of the Listing Rules upon variation or renewal of any of the CCT Agreements and the Arrangements.

    THE ACQUISITION

    The Board is pleased to announce that on 4 December 2017 (after trading hours), BPSL (Thulhiriya), an indirect wholly-owned subsidiary of the Company, the JV Partner and the JV Company entered into the JV Agreement, pursuant to which (i) BPSL (Thulhiriya) has conditionally agreed to purchase and acquire from the JV Partner, and the JV Partner has conditionally agreed to sell and transfer to BPSL (Thulhiriya), the Sale Shares at the Consideration; and (ii) BPSL (Thulhiriya) and the JV Partner agreed to, amongst other things, regulate the ownership, funding and management of the JV Company on the terms and conditions as set out in the JV Agreement. As at the date of this announcement, the JV Company is owned as to 100% by the JV Partner. Upon completion of the Acquisition, the JV Company will be held as to 51% by BPSL (Thulhiriya) and as to 49% by the JV Partner.

    The principal terms of the JV Agreement are set out below:

    THE JV AGREEMENT

    Date: 4 December 2017

    Parties: (i) BPSL (Thulhiriya)

    1. JV Partner

    2. JV Company

      3. To the best of the Directors' knowledge, information and belief and having made all reasonable enquiries, as at the date of this announcement, the JV Partner, the JV Company and their respective ultimate beneficial owners are third parties independent of the Company and its connected persons (as defined under the Listing Rules).

      Assets to be acquired

      The Sale Shares, representing 51% of the total issued share capital of the JV Company, shall be acquired free from all encumbrances and third party rights together with all rights and benefits accrued thereto as at the Completion Date.

      Consideration

      The Consideration shall equal to 51% of the NAV of the JV Company as at the Completion Date to be determined in accordance with the Closing Accounts, which shall in any event be no more than US$50,000,000 (equivalent to approximately HK$390,000,000).

      BPSL (Thulhiriya) shall inform the JV Partner no less than 30 Business Days prior to Completion Date of its intention to make payment of the Estimated Consideration (as defined below) and the transfer of the Sale Shares on such date. The JV Partner shall, no less than

      15 Business Days prior to the Completion Date, deliver to BPSL (Thulhiriya) a written statement setting forth in reasonable details of the JV Partner's good faith calculation of 51% of the estimated NAV of the JV Company as at the Completion Date, which shall in any event be no more than US$50,000,000 (the "Estimated Consideration"). BPSL (Thulhiriya) shall pay to the JV Partner the full amount of the Estimated Consideration in cash on the Completion Date. The JV Partner shall, as soon as practicable after the Completion Date but in any event no more than 60 days after the Completion Date, deliver to BPSL (Thulhiriya) the Closing Accounts. If the Estimated Consideration is greater than the Final Consideration, the JV Partner shall refund the difference between the Estimated Consideration and the Final Consideration to BPSL (Thulhiriya) within 5 Business Days after the date of receipt of the Closing Accounts by BPSL (Thulhiriya). If the Final Consideration is greater than the Estimated Consideration, BPSL (Thulhiriya) shall pay the difference between the Final Consideration and the Estimated Consideration in cash to the JV Partner within 5 Business Days after the date of receipt of the Closing Accounts by BPSL (Thulhiriya), provided that the total Consideration to be paid by BPSL (Thulhiriya) shall in any event be no more than US$50,000,000 (equivalent to approximately HK$390,000,000).

      The consideration for the Acquisition was determined after arm's length negotiations between BPSL (Thulhiriya) and the JV Partner having taken into account the financial information of the JV Company. The Acquisition will be funded by bank loans and the internal resources of the Group.

      Conditions precedent

      Completion of the Acquisition is conditional upon and subject to, among others, the following conditions:

    Best Pacific International Holdings Ltd. published this content on 04 December 2017 and is solely responsible for the information contained herein.
    Distributed by Public, unedited and unaltered, on 04 December 2017 16:01:03 UTC.

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