ADDITIONAL ANNOUNCEMENT AND CLARIFICATION RELATING TO THE DISCLOSURE TRANSACTION: THE ASSIGNMENT
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Star Properties Group (Cayman Islands) Limited 星星 地產 集團 (開 曼 群島) 有限公司
(Incorporated in Cayman Islands with limited liability)
(Stock Code: 1560)
ADDITIONAL ANNOUNCEMENT AND CLARIFICATION
WITH RESPECT TO A DISCLOSEABLE TRANSACTION:
Reference is made to the announcement of Star Properties Group (Cayman Islands) Limited (the “Company“) published on March 3 2021 (the “Ad“) concerning the transaction to be disclosed of elimination. Unless otherwise indicated, capitalized terms used herein will have the same meaning as those defined in the advertisement.
As indicated in the announcement, the completion of the assignment will be subject and conditional (unless the buyer waives it) to several conditions. The company wishes to complete clause (d) under the “Prerequisite” section by revising clause (d) as follows:
“Certain declarations, commitments and guarantees given by the seller with regard to the ownership of the property, no litigation and no charge on the assets of the target company the provisional agreement and the formal agreement (if any) are and will remain true, correct, correct in all material respects until completion; and (applicable only if the Option to Purchase Property has not been exercised) all representations, undertakings and warrants given by the Seller under the Provisional Agreement shall remain true, correct and correct in all material respects until upon completion;“
PURCHASE PRICE ADJUSTMENT
As stated in the announcement, the purchase price is subject to adjustment. The Company wishes to complete the details of the purchase price adjustment as follows:
On the completion date, provided that the property acquisition option has not been exercised: –
(a) if the target company’s current assets exceed its current liabilities (excluding sales debt and outstanding debt under the existing mortgage, if any), the buyer will pay the excess to the seller on completion, or the seller will pay the deficit to the Buyer if the current assets of the Target Company are less than its current liabilities (excluding the Loan to Sell and the amount of debt in current mortgage, if applicable);
(b) the Seller undertakes to deliver to the Buyer or to the Buyerlawyers at least three
(3) days before the Completion Date, the pro forma management accounts (hereinafter referred to as the “Pro forma accounts“) including a pro forma profit and loss account of Target company for the period from its date of incorporation / the start of the current financial year to the date of completion and a pro forma balance sheet of the target company at the date of completion. If the NTAV (defined below) as shown in the pro forma accounts is greater or less than zero, the purchase price balance will be adjusted upward or downward (as applicable) as a result of the as follows:
(i) to the purchase price balance will be added all current tangible fixed assets of the target company as indicated in the pro forma accounts, including the rental receivable (if any) (up to and including the date of completion), utilities and other miscellaneous deposits, prepaid rates and government rents, and other expenses related to the property (up to but excluding the date of completion) ; and
(ii) all the liabilities of the target company as indicated in the pro forma accounts (other than sales debt) will be deducted from the purchase price balance.
“NTAV” means the total of all tangible assets of the target company that are readily convertible to cash or cash equivalents (excluding property, all intangible assets and other fixed assets) minus the total of all liabilities (actual, contingent or others, but excluding sales debt) and made available to the target company on the completion date.
As stated in the announcement, the net proceeds of the divestiture (after deducting transaction costs, taxes and professional fees) will be approximately HK $ 15,454,401; and the company intends to usethe net proceeds of the Sale for the repayment of the bank loan and the general working capital of the Group.
The Company wishes to complete the details of the transaction costs and include the repayment of the Target Company’s existing mortgages, which amounted to approximately HK $ 35,607,474 as of December 31, 2020. The Company also wishes to clarify that the use planned net the proceeds of the sale for the repayment of the bank loan referred to the bank loan of the company and its subsidiaries.
The company would like to point out that the inadvertent error under the “Purchase price” in the announcement that the net asset value of the target company as reported in the audited financial statements as of December 31, 2020 is expected to be HK $ 13,430,589 instead of HK $ 49,430,589.
Except as stated above, all information contained in the advertisement remains unchanged.
For and on behalf of the Council
Star Properties Group (Cayman Islands) Limited
Chan Man Fai Joe
Hong Kong, March 4, 2021
As of the date of this announcement, the Board consists of eight directors comprising four executive directors, namely Mr. Chan Man Fai Joe (Chairman), Ms. Cheung Wai Shuen, Mr. Liu Hon Wai and Professor Pong Kam Keung; a non-executive Director, namely Mr. Yim Kwok Man; and three independent non-executive directors, namely Mr. Lee Chung Ming Eric, Ms. Chan Wah Man Carman and Dr. Wong Wai Kong.