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.
DIT GROUP LIMITED
築 友 智 造 科 技 集 團 有 限 公 司
(Incorporated in Bermuda with limited liability)
(Stock Code: 726)
CONNECTED TRANSACTION
IN RELATION TO PROVISION OF FINANCIAL ASSISTANCE
PROVISION OF MORTGAGE
On 29 November 2019 (after trading hours), Xiangtan Drawin (an indirect wholly-owned subsidiary of the Company) entered into the Mortgage Agreement with the Bank, pursuant to which Xiangtan Drawin agreed to provide the Mortgage in favour of the Bank as security for the repayment obligations of Drawin Manufacture (an indirect controlling shareholder of the Company) under the Loan Agreement in respect of a loan facility of up to RMB40,000,000 granted by the Bank to Drawin Manufacture for on-lending to Drawin Investment (an indirect wholly-owned subsidiary of the Company) on the same terms as the Loan Agreement.
IMPLICATIONS UNDER THE LISTING RULES
As at the date of this announcement, Drawin Manufacture indirectly held approximately 63.5% of the issued Shares, thus an indirect controlling shareholder of the Company. Drawin Manufacture is also indirectly wholly-owned by Mr. Wu Po Sum, who is an executive Director; hence, Drawin Manufacture is a connected person of the Company under the Listing Rules. The provision of the Mortgage by Xiangtan Drawin under the Mortgage Agreement therefore constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules.
As the applicable percentage ratios in respect of the provision of the Mortgage are more than 0.1% but less than 5%, the provision of the Mortgage is subject to reporting and announcement requirements but exempt from the independent Shareholders' approval under Chapter 14A of the Listing Rules.
The on-lending of the loan from Drawin Manufacture to Drawin Investment also constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules, but is fully exempted from Shareholders' approval, annual review and all disclosure requirements pursuant to Rule 14A.90 of the Listing Rules.
- 1 -
INTRODUCTION
On 29 November 2019 (after trading hours), Xiangtan Drawin (an indirect wholly-owned subsidiary of the Company) entered into the Mortgage Agreement with the Bank, pursuant to which Xiangtan Drawin agreed to provide the Mortgage in favour of the Bank as security for the repayment obligations of Drawin Manufacture (an indirect controlling shareholder of the Company) under the Loan Agreement in respect of a loan facility of up to RMB40,000,000 granted by the Bank to Drawin Manufacture for on-lending to Drawin Investment (an indirect wholly-owned subsidiary of the Company) on the same terms as the Loan Agreement.
LOAN AGREEMENT
The maximum principal amount of the Loan is RMB40,000,000. The Loan bears interest at a rate of 6.5% per annum for a term of 12 months commencing from the date of drawdown. The repayment obligations of Drawin Manufacture under the Loan Agreement is secured by the Mortgage, among others, and the provision of the Mortgage is one of the conditions under the Loan Agreement.
Upon drawdown of the Loan from the Bank in accordance with the Loan Agreement, it is proposed that Drawin Manufacture will on-lend the Loan to Drawin Investment (an indirect wholly-owned subsidiary of the Company which directly holds the entire equity interests in Xiangtan Drawin) as a shareholder's loan at the same repayment terms and interest rate as those set out in the Loan Agreement, without receiving any fee or commission nor any counter-security or guarantee from Drawin Investment, in support of the Group's business development.
MORTGAGE AGREEMENT
Date: | 29 November 2019 (after trading hours) | |
Parties: | (1) | Xiangtan Drawin (as the mortgagor under the Mortgage |
Agreement) | ||
(2) | The Bank (as the mortgagee under the Mortgage Agreement) |
The principal terms of the Mortgage Agreement are as follows:
Term: | The Mortgage shall become effective from the date of the |
Mortgage Agreement and expire on the date of expiration of 12 | |
months from the date of drawdown of the Loan under the Loan | |
Agreement. | |
Collaterals: | the land use rights of a stated-owned construction land with title |
certificate number of Xiang (2018) Real Estate Title of Xiangtan | |
City No.0032564 and six constructions in process thereon (with a | |
gross floor area of approximately 89,025 m2) with an aggregate | |
mortgaged value of RMB83,380,000 owned by Xiangtan Drawin |
- 2 -
Consideration: | Xiangtan Drawin will not receive any fee or commission from |
providing the Mortgage under the Mortgage Agreement. | |
Scope of mortgage | The scope of mortgage security includes the entire principal |
security: | amount of the indebtedness, interests, overdue interest, compound |
interests, penalty interest, liquidated damages, loss of accessible | |
interests due to early collection of loans by the Bank in | |
accordance with the Loan Agreement, compensation and the costs | |
incurred by the Bank in realizing the creditor's rights (including | |
but not limited to litigation fees, implementation fees, collateral | |
disposal expenses, transfer fee, attorney fees and travel expenses) | |
and other payables, arising from the Loan Agreement between | |
Xiangtan Drawin and the Bank. |
INFORMATION ON THE GROUP, XIANGTAN DRAWIN, DRAWIN MANUFACTURE AND THE BANK
The Company was incorporated as an exempted company with limited liability in Bermuda, the Shares of which are listed on the Stock Exchange. It is an investment holding company with subsidiaries principally engaged in prefabricated construction business and property investment in the PRC.
Xiangtan Drawin is a company established under the laws of the PRC with limited liability. It is an indirect wholly-owned subsidiary of the Company and is mainly engaged in construction industrialisation.
Drawin Manufacture is a company established under the laws of the PRC with limited liability. As at the date of this announcement, Drawin Manufacture indirectly held approximately 63.5% of the issued Shares, thus an indirect controlling shareholder of the Company. Drawin Manufacture is also indirectly wholly-owned by Mr. Wu Po Sum, who is an executive Director. Drawin Manufacture is an investment holding company. Apart from the equity interests in the Company, Drawin Manufacture, through its PRC subsidiaries, is principally engaged in general consultation and design of prefabricated construction business in the PRC.
To the best knowledge of the Directors, the Bank is a licensed commercial bank in the PRC and provides a variety of financial products and services to corporate and personal banking customers. To the best of the Directors' knowledge, information and belief, having made all reasonable enquiries, each of the Bank and its ultimate beneficial owners is an Independent Third Party.
REASONS FOR AND BENEFITS OF THE PROVISION OF THE MORTGAGE
In the course of business development, the Group seeks various source of financing from time to time. The Group has recently explored the possibility of obtaining a loan of the same amount as the Loan from commercial banks with similar collaterals as the Mortgage. However, the proposed terms of such loan offered to the Group are not as favourable as the terms offered to Drawin Manufacture by the Bank in the Loan Agreement. Drawin Manufacture, being an indirect controlling shareholder of the Company, therefore proposed
- 3 -
to obtain the Loan from the Bank and, in accordance with the terms of the Loan Agreement, on-lend the same to Drawin Investment as a shareholder's loan at the same repayment terms and interest rate as those set out in the Loan Agreement, without receiving any fee or commission nor any counter-security or guarantee from Drawin Investment for such arrangement. As the provision of the Mortgage is one of the conditions of the Loan under the Loan Agreement, the Directors believe that the provision of the Mortgage will facilitate Drawin Manufacture to obtain the Loan from the Bank for on-lending to Drawin Investment in support of the Group's business development and which in turn is beneficial to the Company and its shareholders as a whole.
The Directors (including the independent non-executive Directors) are of the view that the terms of the Mortgage Agreement are on normal commercial terms and are fair and reasonable and in the interests of the Company and the Shareholders as a whole.
IMPLICATIONS UNDER THE LISTING RULES
As at the date of this announcement, Drawin Manufacture indirectly held approximately 63.5% of the issued Shares, thus an indirect controlling shareholder of the Company. Drawin Manufacture is also indirectly wholly-owned by Mr. Wu Po Sum, who is an executive Director; hence, a connected person of the Company under the Listing Rules. The provision of the Mortgage by Xiangtan Drawin under the Mortgage Agreement therefore constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules.
As the applicable percentage ratios in respect of the provision of the Mortgage are more than 0.1% but less than 5%, the provision of the Mortgage is subject to reporting and announcement requirements but exempt from the independent Shareholders' approval under Chapter 14A of the Listing Rules.
The provision of the Shareholder's Loan by Drawin Manufacture to Drawin Investment also constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. As the Shareholder's Loan is conducted on normal commercial terms or better and the Shareholder's Loan is not secured by any assets of the Group, the Shareholder's Loan is fully exempted from Shareholders' approval, annual review and all disclosure requirements pursuant to Rule 14A.90 of the Listing Rules.
To the best of the Directors' knowledge and belief after having made all reasonable enquiries, other than (1) Mr. Wu Po Sum (an executive Director) who indirectly holds the entire equity interests in Drawin Manufacture, and (2) Ms. Wu Wallis (alias Li Hua) (a non- executive Director) who is the daughter of Mr. Wu Po Sum, none of the Directors has a material interest in the Mortgage Agreement, the Shareholder's Loan and the transactions contemplated thereunder. Other than Mr. Wu Po Sum and Ms. Wu Wallis (alias Li Hua) who had abstained from voting on the relevant Board resolutions approving the Mortgage Agreement, the Shareholder's Loan and the transactions contemplated thereunder for good corporate governance purpose, none of the other Directors was required to abstain from voting on the relevant Board resolutions.
- 4 -
DEFINITIONS
Unless the context requires otherwise, capitalised terms used herein shall have the same meanings as set forth below:
''Bank'' | Yuhua Sub-branch of Changsha Rural Commercial Bank |
Co., Ltd., a licensed commercial bank in the PRC, being the | |
lender under the Loan Agreement | |
''Board'' | the board of Directors |
''Company'' | DIT Group Limited, a company incorporated in Bermuda |
with limited liability, the Shares of which are listed on the | |
Main Board of the Stock Exchange | |
''connected person'' | has the meaning ascribed to it under the Listing Rules |
''controlling shareholders'' | has the meaning ascribed to it under the Listing Rules |
''Director(s)'' | the director(s) of the Company from time to time |
''Drawin Investment'' | China Minsheng Drawin Technology Investment Limited* |
(中民築友科技投資有限公司), a company established under | |
the laws of the PRC with limited liability and an indirect | |
wholly-owned subsidiary of the Company | |
''Drawin Manufacture'' | Drawin Intelligent Manufacture Technology Industry |
Limited* (築友智造 科技產業集團有限公司) (formerly | |
known as China Minsheng Drawin Technology Industry | |
Limited* (中民築友科技產業有限公司)), a company | |
established under the laws of the PRC with limited | |
liability, being the borrower under the Loan Agreement | |
''Group'' | the Company and its subsidiaries from time to time |
''Hong Kong'' | the Hong Kong Special Administrative Region of the |
People's Republic of China | |
''Independent Third Party'' | third party who is independent of and not connected with |
the Company and the connected person(s) of the Company | |
''Listing Rules'' | the Rules Governing the Listing of Securities on the Stock |
Exchange | |
''Loan'' | the loan in the principal amount of up to RMB40,000,000 |
granted by the Bank to Drawin Manufacture in accordance | |
with the terms of the Loan Agreement and subject to the | |
conditions therein |
- 5 -
''Loan Agreement'' | the loan agreement dated 29 November 2019 entered into |
between Drawin Manufacture and the Bank, pursuant to | |
which, the Bank agreed to grant the Loan to Drawin | |
Manufacture | |
''Mortgage'' | the mortgage provided by Xiangtan Drawin with its land |
use rights of a stated-owned construction land and six | |
constructions in process thereon (with a gross floor area of | |
approximately 89,025 m2) to the Bank pursuant to the | |
Mortgage Agreement | |
''Mortgage Agreement'' | the mortgage agreement dated 29 November 2019 entered |
into between Xiangtan Drawin and the Bank, pursuant to | |
which, Xiangtan Drawin agreed to provide the Mortgage in | |
favour of the Bank as security for the repayment obligations | |
of Drawin Manufacture under the Loan Agreement | |
''PRC'' | the People's Republic of China which, for the purpose of |
this announcement, excludes Hong Kong, the Macau | |
Special Administrative Region of the People's Republic of | |
China and Taiwan | |
''Share(s)'' | the ordinary share(s) of par value HK$0.10 each in the |
share capital of the Company | |
''Shareholder(s)'' | the holder(s) of the issued Share(s) |
''Shareholder's Loan'' | the proposed unsecured shareholder's loan in the amount of |
RMB40,000,000 to be provided by Drawin Manufacture to | |
Drawin Investment | |
''Stock Exchange'' | The Stock Exchange of Hong Kong Limited |
''Xiangtan Drawin'' | Xiangtan China Minsheng Drawin Technology Limited* (湘 |
潭中民築友科技有限公司), a company established under | |
the laws of the PRC with limited liability and an indirect | |
wholly-owned subsidiary of the Company | |
By order of the Board of | |
DIT Group Limited | |
Wu Po Sum | |
Chairman and Executive Director | |
Hong Kong, 2 December 2019 |
As at the date of this announcement, the Board comprises Mr. Wu Po Sum (Chairman), Mr. Guo Weiqiang and Mr. Yang Hongwei as executive Directors; Ms. Wu Wallis (alias Li Hua) and Mr. Wang Jun as non-executive Directors; Mr. Jiang Hongqing, Mr. Lee Chi Ming and Mr. Ma Lishan as independent non-executive Directors.
* For identification purpose only
- 6 -
Attachments
- Original document
- Permalink
Disclaimer
China Minsheng Drawin Technology Group Ltd. published this content on 02 December 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 December 2019 13:54:03 UTC