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Rykadan Capital Limited Proxy Solicitation & Information Statement 2025
50499_rns_2025-03-26_e468b51d-c6fd-4bfa-8213-9e7a7113f8de.pdf
Proxy Solicitation & Information Statement
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THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION
If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.
If you have sold or transferred all your shares in Rykadan Capital Limited 宏基資本有限公司, you should at once hand this circular together with the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.
RYKADAN CAPITAL
RYKADAN CAPITAL LIMITED
宏基資本有限公司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 2288)
(1) VERY SUBSTANTIAL DISPOSAL IN RELATION TO
DISPOSAL OF PROPERTIES
AND
(2) NOTICE OF EXTRAORDINARY GENERAL MEETING
Capitalised terms used in this cover page shall have the meanings set out in the section headed "Definitions" of this circular.
A notice convening the EGM to be held at Room 1, 10/F, United Centre, 95 Queensway, Admiralty, Hong Kong on 17 April 2025, Thursday at 3:00 p.m. is set out on pages EGM-1 to EGM-3 of this circular. A form of proxy for use at the EGM is also enclosed with this circular. Whether or not you intend to attend the EGM, you are requested to complete and sign the enclosed form of proxy in accordance with the instructions printed thereon and return the same to the Company's Hong Kong branch share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the EGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof (as the case may be) should you so wish. In such event, the form of proxy shall be deemed to be revoked.
There will be NO distribution of souvenir or service of refreshment at the EGM.
27 March 2025
CONTENTS
Page
Definitions. ... 1
Letter from the Board ... 5
Appendix I – Financial Information of the Group. ... I-1
Appendix II – Financial Information of the Properties. ... II-1
Appendix III – Unaudited Pro Forma Financial Information of
the Remaining Group ... III-1
Appendix IV – Valuation Report on the Properties ... IV-1
Appendix V – General Information. ... V-1
Notice of EGM ... EGM-1
- i -
DEFINITIONS
In this circular, the following expressions have the following respective meanings unless the context requires otherwise:
"Board"
the board of Directors
"Break-up Fee"
the sum of HK$8,176,320 to be paid to the Purchaser by Vendor A under Formal Agreement A or by Vendor B under Formal Agreement B if the Formal Agreement A or Formal Agreement B (as the case may be) is terminated due to the non-fulfilment of the Condition Precedent, and "Break-up Fees" means the Break-up Fee payable pursuant to Formal Agreement A and the Break-up Fee payable pursuant to Formal Agreement B, being HK$16,352,640 in aggregate
"BVI"
British Virgin Islands
"close associate(s)"
has the meaning ascribed to it under the Listing Rules
"Company"
Rykadan Capital Limited, an exempt company incorporated in the Cayman Islands with limited liability, the Shares of which are listed on the Main Board of the Stock Exchange (Stock Code: 2288)
"Completion"
in relation to Disposal A, completion of Disposal A or in relation to Disposal B, completion of Disposal B in accordance with the Formal Agreement
"Condition Precedent"
the condition precedent to Completion as set out in the first paragraph of the sub-section headed "Condition" under the section headed "THE DISPOSALS" in the Letter from the Board of this circular
"connected persons"
has the meaning ascribed to this term under the Listing Rules
"Consideration"
in relation to Disposal A, the consideration for Disposal A or in relation to Disposal B, the consideration for Disposal B
"Director(s)"
the director(s) of the Company
"Disposal A"
the disposal of Property A by Vendor A to the Purchaser contemplated under the Formal Agreement A
"Disposal B"
the disposal of Property B by Vendor B to the Purchaser contemplated under the Formal Agreement B
- 1 -
DEFINITIONS
| “Disposals” | collectively, Disposal A and Disposal B and each a “Disposal” |
|---|---|
| “EGM” | an extraordinary general meeting of the Company to be convened and held at Room 1, 10/F, United Centre, 95 Queensway, Admiralty, Hong Kong on 17 April 2025, Thursday at 3:00 p.m. for the purpose of considering and, if thought fit, approving among other things, the Formal Agreements and the transactions contemplated thereunder |
| “Formal Agreement A” | the formal agreement dated 17 December 2024 entered into between Vendor A and the Purchaser in relation to Disposal A |
| “Formal Agreement B” | the formal agreement dated 17 December 2024 entered into between Vendor B and the Purchaser in relation to Disposal B |
| “Formal Agreements” | collectively, Formal Agreement A and Formal Agreement B and each a “Formal Agreement” |
| “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 People’s Republic of China |
| “Latest Practicable Date” | 21 March 2025, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information for inclusion in this circular |
| “Listing Rules” | the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited |
| “Mr. Chan” | Mr. Chan William, an executive Director and a substantial Shareholder |
| “Mr. Ng” | Mr. Ng Tak Kwan, a non-executive Director and a substantial Shareholder |
| “Property A” | collectively, the 27th Floor and car parking spaces nos. P11, P12, P13 and P14 on the 1st Floor of Rykadan Capital Tower |
- 2 -
DEFINITIONS
| “Property B” | collectively, the 28^{th} Floor and car parking spaces nos. P7, P8, P9 and P10 on the 1^{st} Floor of Rykadan Capital Tower |
|---|---|
| “Properties” | collectively, Property A and Property B and each a “Property” |
| “Provisional Agreement A” | the provisional agreement for sale and purchase dated 3 December 2024 entered into between Vendor A and the Purchaser in relation to Disposal A |
| “Provisional Agreement B” | the provisional agreement for sale and purchase dated 3 December 2024 entered into between Vendor B and the Purchaser in relation to Disposal B |
| “Provisional Agreements” | collectively, Provisional Agreement A and Provisional Agreement B |
| “Purchaser” | German Pool (Hong Kong) Limited, a company incorporated in Hong Kong with limited liability, the purchaser of the Properties under the Formal Agreements |
| “Remaining Group” | the Group immediately after the Completion |
| “Revenue-generating Properties” | those portions of the Properties that are revenue-generating assets for the purpose of Rule 14.68(2)(b) of the Listing Rules |
| “Rykadan Capital Tower” | the property known as Rykadan Capital Tower located at No. 135 Hoi Bun Road, Kowloon, Hong Kong |
| “SFO” | the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) |
| “Share(s)” | ordinary share(s) with nominal value of HK$0.01 each in the share capital of the Company |
| “Shareholder(s)” | holders of Share(s) |
| “Stock Exchange” | The Stock Exchange of Hong Kong Limited |
| “subsidiary” | has the meaning as ascribed to it under the Listing Rules |
- 3 -
DEFINITIONS
| “Tiger Crown” | Tiger Crown Limited, a company incorporated in the BVI with limited liability and a substantial Shareholder, and a controlled corporation of Mr. Chan under the SFO |
|---|---|
| “Vendor A” | Win Expo Enterprises Limited, a company incorporated in Hong Kong with limited liability and an indirect wholly-owned subsidiary of the Company, the vendor of Property A under the Formal Agreement A |
| “Vendor B” | Prime Talent Development Limited, a company incorporated in Hong Kong with limited liability and an indirect wholly-owned subsidiary of the Company, the vendor of Property B under the Formal Agreement B |
| “Vendors” | collectively, Vendor A and Vendor B and each a “Vendor” |
| “%” | per cent |
- 4 -
LETTER FROM THE BOARD
RYKADAN CAPITAL
RYKADAN CAPITAL LIMITED
宏基資本有限公司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 2288)
Executive Directors:
Mr. Chan William (陳偉倫)
(Chairman and Chief Executive Officer)
Mr. Lo Hoi Wah, Heywood (勞海華)
(Chief Financial Officer)
Non-executive Director:
Mr. Ng Tak Kwan (吳德坤)
Independent Non-executive Directors:
Mr. To King Yan, Adam (杜景仁)
Mr. Ho Kwok Wah, George (何國華)
Ms. Khan Sabrina (簡佩詩)
Registered Office:
Cricket Square
Hutchins Drive
P.O. Box 2681
Grand Cayman, KY1-111
Cayman Islands
Principal Place of Business in
Hong Kong:
Rooms 2701 & 2801
Rykadan Capital Tower
135 Hoi Bun Road
Kwun Tong, Kowloon
Hong Kong
27 March 2025
To the Shareholders
Dear Sir/Madam,
(1) VERY SUBSTANTIAL DISPOSAL IN RELATION TO
DISPOSAL OF PROPERTIES
AND
(2) NOTICE OF EXTRAORDINARY GENERAL MEETING
INTRODUCTION
Reference is made to the announcement of the Company dated 3 December 2024 in relation to the Disposals.
The purpose of this circular is to provide you with, among other things, (i) further details of the Disposals; (ii) the financial information of the Group and the Properties; (iii) the pro forma financial information of the Remaining Group upon Completion; (iv) the valuation report of the Properties; and (v) the notice convening the EGM.
LETTER FROM THE BOARD
THE DISPOSALS
On 3 December 2024 (after trading hours), the Vendors, both indirect wholly-owned subsidiaries of the Company, entered into the Provisional Agreements with the Purchaser in respect of the sale and purchase of Property A and Property B respectively at an aggregate consideration of HK$163,526,400. On 17 December 2024 and as contemplated under the terms of the Provisional Agreements, the Vendors and the Purchasers entered into the Formal Agreements, which superseded the Provisional Agreements.
The Formal Agreement A
Set out below are the principal terms of the Formal Agreement A which are on substantially the same terms as the Provisional Agreement A:
Date
17 December 2024
Parties
(1) Win Expo Enterprises Limited as Vendor A (an indirect wholly-owned subsidiary of the Company); and
(2) German Pool (Hong Kong) Limited as the Purchaser
Property A
Property A to be disposed of consists of the 27th Floor of Rykadan Capital Tower and the car parking spaces nos. P11, P12, P13 and P14 on the 1st Floor of Rykadan Capital Tower. Property A will be sold on an "as is" basis and vacant possession of Property A will be delivered to the Purchaser upon Completion.
Consideration and Payment Terms
The Consideration of HK$81,763,200 shall be payable in the following manner:
1) an initial deposit of HK$4,088,160 shall be paid by the Purchaser to Vendor A's solicitors as stakeholder upon signing of the Provisional Agreement A;
2) a further deposit of HK$4,088,160 shall be paid by the Purchaser to Vendor A's solicitors as stakeholder on or before 17 December 2024; and
3) the balance in the sum of HK$73,586,880 shall be paid by the Purchaser to Vendor A upon Completion.
All deposits shall be paid by the Purchaser to Vendor A's solicitors as stakeholder who may release the same to Vendor A provided that the balance of the Consideration is sufficient to discharge the existing mortgage in respect of Property A.
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LETTER FROM THE BOARD
The initial deposit and the further deposit have been paid by the Purchaser.
The Consideration was determined after arm's length negotiations between Vendor A and the Purchaser with reference to the then recent transaction prices for comparable properties in the surrounding area of Property A, the preliminary valuation (adopting the market approach) of Property A as at 30 September 2024 at HK$84,600,000 as verbally indicated by an independent valuer, the then recent verbal indications of purchase price from two other potential purchasers of Property A (all were lower than the preliminary valuation price) and the prevailing property market condition and sentiment. For the purpose of compliance with Rule 5.07 of the Listing Rules, the valuation of Property A is updated to the date as of 31 January 2025 adopting the same market approach, the text of which is set out in Appendix IV to this circular. As at 31 January 2025, the appraised value of Property A amounted to HK$77,800,000. The Board understood from the independent valuer that the difference between the preliminary valuation as at 30 September 2024 and the appraised valuation as at 31 January 2025 of Property A was primarily attributable to the decline in the private office market conditions, which led to the decrease in the price index for private offices according to the statistics published by the Rating and Valuation Department.
The Formal Agreement B
Set out below are the principal terms of the Formal Agreement B which are on substantially the same terms as the Provisional Agreement B:
Date
17 December 2024
Parties
(1) Prime Talent Development Limited as Vendor B (an indirect wholly-owned subsidiary of the Company); and
(2) German Pool (Hong Kong) Limited as the Purchaser
Property B
Property B to be disposed of consists of the 28th Floor of Rykadan Capital Tower and the car parking spaces nos. P7, P8, P9 and P10 on the 1st Floor of Rykadan Capital Tower. Property B will be sold on an "as is" basis and subject to existing tenancies. For those parts of Property B which are not subject to the aforesaid tenancies or where any of such tenancies shall expire or shall for any reason terminate and the relevant tenant or occupier shall have delivered vacant possession of the relevant portion of Property B (the "Vacant Portions"), vacant possession of such Vacant Portions shall be delivered to the Purchaser upon Completion.
LETTER FROM THE BOARD
Consideration and Payment Terms
The Consideration of HK$81,763,200 shall be payable in the following manner:
1) an initial deposit of HK$4,088,160 shall be paid by the Purchaser to Vendor B’s solicitors as stakeholder upon signing of the Provisional Agreement B;
2) a further deposit of HK$4,088,160 shall be paid by the Purchaser to Vendor B’s solicitors as stakeholder on or before 17 December 2024; and
3) the balance in the sum of HK$73,586,880 shall be paid by the Purchaser to Vendor B upon Completion.
All deposits shall be paid by the Purchaser to Vendor B’s solicitors as stakeholder who may release the same to Vendor B provided that the balance of the Consideration is sufficient to discharge the existing mortgage in respect of Property B.
The initial deposit and the further deposit have been paid by the Purchaser.
The Consideration was determined after arm’s length negotiations between Vendor B and the Purchaser with reference to the then recent transaction prices for comparable properties in the surrounding area of Property B, the preliminary valuation (adopting the market approach) of Property B as at 30 September 2024 at HK$85,300,000 as verbally indicated by an independent valuer, the then recent verbal indications of purchase price from two other potential purchasers of Property B (all were lower than the preliminary valuation price) and the prevailing property market condition and sentiment. For the purpose of compliance with Rule 5.07 of the Listing Rules, the valuation of Property B is updated to the date as of 31 January 2025 adopting the same market approach, the text of which is set out in Appendix IV to this circular. As at 31 January 2025, the appraised value of Property B amounted to HK$78,500,000. The Board understood from the independent valuer that the difference between the preliminary valuation as at 30 September 2024 and the appraised valuation as at 31 January 2025 of Property B was primarily attributable to the decline in the private office market conditions, which led to the decrease in the price index for private offices according to the statistics published by the Rating and Valuation Department.
Condition
In respect of each Disposal, Completion is conditional upon Formal Agreement A or Formal Agreement B (as the case may be) and the transactions contemplated thereby having been approved by the Shareholders in accordance with the Listing Rules.
Apart from the Condition Precedent mentioned in the preceding paragraph, it is also a condition of Formal Agreement A or Formal Agreement B (as the case may be) that the transaction under the other Formal Agreement shall be completed simultaneously with the transaction under Formal Agreement A or Formal Agreement B (as the case may be).
LETTER FROM THE BOARD
Break-up Fees
Each of the Formal Agreements provides that in the event that the Condition Precedent is not fulfilled by 29 April 2025, the sale and purchase of the Property shall be annulled and cancelled and that in addition to the return to the Purchaser of the initial deposit and the further deposit paid by the Purchaser pursuant to the Formal Agreement A or the Formal Agreement B (as the case may be), Vendor A or Vendor B (as the case may be) will be required to pay the Purchaser the Break-up Fee of HK$8,176,320, being a sum equivalent to the aggregate amount of such initial deposit and further deposit.
Payment of the Break-up Fees, amounted to HK$16,352,640 in aggregate, is not dependent or consequential on any breach of the Formal Agreements.
The amount of the Break-up Fee payable under each of the Formal Agreements was determined by Vendor A or Vendor B (as the case may be) on the one hand and the Purchaser on the other hand with reference to the amount of the initial deposit and further deposit made and to be made by the Purchaser thereunder and it was considered commercially appropriate and fair.
Vendors' Right to Cancel the Formal Agreements
If the Purchaser shall make or insist on any objection or requisition in respect of the title or otherwise which Vendor A or Vendor B (as the case may be) shall be unable or (due to difficulty, delay, expense or any other reasonable ground) unwilling to remove or comply with or if the title of Vendor A or Vendor B (as the case may be) is defective, Vendor A or Vendor B (as the case may be) shall notwithstanding any previous negotiation or litigation, be at liberty to cancel the sale and purchase of Property A or Property B (as the case may be) on giving to the Purchaser or its solicitors at least 5 working days' notice in writing, in which case unless the objection or requisition shall have been in the meantime withdrawn by the Purchaser or the same shall have been complied with or removed by Vendor A or Vendor B (as the case may be), the sale and purchase of Property A or Property B (as the case may be) shall on the expiry of the notice be cancelled and the Purchaser shall be entitled to a return of all the deposits paid without interest.
Breach
If the Purchaser fails to complete the purchase in accordance with the terms of Formal Agreement A or Formal Agreement B (as the case may be), the deposit and any other money paid by the Purchaser under Formal Agreement A or Formal Agreement B (as the case may be) up to 10% of the Consideration shall be absolutely forfeited to Vendor A or Vendor B (as the case may be) whereupon the sale of Property A or Property B (as the case may be) to the Purchaser shall be determined and Vendor A or Vendor B (as the case may be) shall be entitled to resell Property A or Property B (as the case may be) to any other party without notice to the Purchaser. Vendor A or Vendor B (as the case may be) shall be entitled to recover from the Purchaser any deficiency in price in such resale and all reasonable expenses in respect of such resale.
- 9 -
LETTER FROM THE BOARD
If Vendor A or Vendor B (as the case may be) fails to complete the sale (as the case may be) in accordance with the terms of Formal Agreement A or Formal Agreement B (as the case may be), then all the deposit(s) paid shall be returned to the Purchaser who shall also be entitled to recover from Vendor A or Vendor B (as the case may be) such damages (if any) as the Purchaser may sustain by reason of such failure on the part of Vendor A or Vendor B (as the case may be) and it shall not be necessary for the Purchaser to tender an assignment to Vendor A or Vendor B (as the case may be).
In the Formal Agreements, there is no provision that limits the amount of damages payable by the Vendor. Considering that (1) the absence of such provision is conventional for transactions involving the sale and purchase of real property; (2) there is also no limit set on the amount recoverable from the Purchaser on the Purchaser's failure to complete the purchases under the Formal Agreements, which serves to deter the Purchaser from not completing the purchases in accordance with the Formal Agreements; and (3) if there is any dispute on the amount of damages payable by the Vendors and the Purchaser brings an action against the Vendors, the Purchaser needs to prove the entitlement to the amount of damages claimed to the satisfaction of the court in accordance with applicable laws, the Directors consider that the non-inclusion in the Formal Agreements of a provision that limits the amount of damages payable by the Vendor in the event that the Vendor fails to complete is fair and reasonable and in the interests of the Company and its Shareholders as a whole.
Completion
Disposal A and Disposal B shall be completed simultaneously with each other and Completion is scheduled to take place at or before 5:00 p.m. on 30 April 2025.
If there is any breach by Vendor A under Formal Agreement A, Vendor B is deemed to be also in breach of Formal Agreement B. If there is any breach by Vendor B under Formal Agreement B, Vendor A is deemed to be also in breach of Formal Agreement A. If there is any breach by the Purchaser under either Formal Agreement A or Formal Agreement B, the Purchaser is deemed to be also in breach of the other Formal Agreement.
If Vendor A is entitled to annul or rescind Formal Agreement A, Vendor B is also entitled to annul or rescind Formal Agreement B. If Vendor B is entitled to annul or rescind Formal Agreement B, Vendor A is also entitled to annul or rescind Formal Agreement A. If the Purchaser is entitled to annul or rescind under either Formal Agreement A or Formal Agreement B, the Purchaser is also entitled to annul or rescind the other Formal Agreement.
Release of mortgage
Each of the Properties is subject to mortgage and Vendor A or Vendor B (as the case may be) has undertaken to obtain at its own costs discharge/release of Property A or Property B (as the case may be) from such mortgage on Completion. The Purchaser shall accept the Vendor's solicitors' undertaking to send to the Purchaser's solicitors the said discharge/release within 21 days after Completion. As disclosed in the section headed "Financial Effect of the Disposals and Intended Use of Proceeds" in this letter from the Board, part of the Consideration will be used towards repayment of mortgage loans in respect of the Properties.
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LETTER FROM THE BOARD
Estate Agent Commissions
Disposal A
In consideration of the services rendered by the estate agent in respect of Disposal A and subject to below paragraphs, the estate agent is entitled to receive HK$2,044,080 from Vendor A as commission. Such commission shall be paid within 7 days after the date of Completion.
If the sale and purchase of Property A is annulled and/or cancelled due to the non-fulfillment of the Condition Precedent or due to title issue or by mutual agreement by Vendor A and the Purchaser, Vendor A and the Purchaser shall not be required to pay any commission or compensation to the estate agent.
If in any cases (save and except the sale and purchase of Property A being annulled and/or cancelled by mutual agreement by Vendor A and the Purchaser), either Vendor A or the Purchaser fails to complete the sale and purchase of Property A in the manner contained in the Formal Agreement A, the defaulting party shall forthwith pay to the estate agent the commission aforementioned as liquidated damages. For the avoidance of doubt, the liquidated damages shall be in lieu of, and equivalent to, the commission amount and shall not be in addition to the commission amount.
Disposal B
In consideration of the services rendered by the estate agent in respect of Disposal B and subject to below paragraphs, the estate agent is entitled to receive HK$2,044,080 from Vendor B as commission. Such commission shall be paid within 7 days after the date of Completion.
If the sale and purchase of Property B is annulled and/or cancelled due to the non-fulfillment of the Condition Precedent or due to title issue or by mutual agreement by Vendor B and the Purchaser, Vendor B and the Purchaser shall not be required to pay any commission or compensation to the estate agent.
If in any cases (save and except the sale and purchase of Property B being annulled and/or cancelled by mutual agreement by Vendor B and the Purchaser), either Vendor B or the Purchaser fails to complete the sale and purchase of Property B in the manner contained in the Formal Agreement B, the defaulting party shall forthwith pay to the estate agent the commission aforementioned as liquidated damages. For the avoidance of doubt, the liquidated damages shall be in lieu of, and equivalent to, the commission amount and shall not be in addition to the commission amount.
LETTER FROM THE BOARD
REASONS FOR AND BENEFITS OF THE TRANSACTIONS
The Disposals
The Directors undertake strategic review of the Group’s assets from time to time with a view to generating promising returns for the Shareholders. Certain portions of the Properties have been used as the Company’s headquarters and principal place of business in Hong Kong. However, such portions have not been fully occupied and utilized and the Group has incurred associated costs with maintaining and managing these unused area. Moreover, the Directors are of the view that the Consideration under the Formal Agreement, which represents (i) a discount of approximately 3.35% (in respect of Property A) or approximately 4.15% (in respect of Property B) as compared to the preliminary valuation of the Property as at 30 September 2024 and (ii) a premium of approximately 5.09% (in respect of Property A) or approximately 4.16% (in respect of Property B) as compared to the appraised value of the Property as at 31 January 2025 stated in the valuation report as set out in Appendix IV to this circular, is a reasonable reflection of the market’s assessment on the values of the Properties under the prevailing property market condition and sentiment. In view thereof, the Directors are of the view that the Disposals represent a good opportunity for the Group to realise its investment in the Properties, and to allow the Group to streamline its asset portfolio, deploy its resources in a more efficient manner and to seize other investment opportunities which provide better returns to the Group. The Company will identify and relocate to other suitable premises as its headquarters and principal place of business.
The payment of the Break-up Fees
In order to secure the Purchaser’s commitment to the Disposals and to secure that the Purchaser pays to the Vendors an aggregate of HK$16,352,640 (being the total amount of the initial deposits and further deposits provided for in the Provisional Agreement (such terms are now incorporated in the Formal Agreements which superseded the Provisional Agreements) before the date of the EGM for the protection of the Vendors in the event of default of the Purchaser and to compensate the Purchaser for the loss of opportunity in the event that the Shareholders do not approve the Disposals, the Vendors and the Purchaser agreed on the Break-up Fees arrangement.
By requiring the Purchaser to pay the initial deposit upfront and the further deposit under each of the Formal Agreements prior to the date of the EGM, the Vendors has secured a considerable financial commitment of the Purchaser in the Disposals thereby mitigating the risk of the Purchaser being able to withdraw from the Disposals at relatively low financial cost. On the other hand, since the fulfilment of the Condition Precedent is something beyond the control of the Purchaser and the Purchaser has incurred costs in negotiating and entering into the Provisional Agreements and the Formal Agreements and will suffer the loss of opportunity in the event that the Condition Precedent is not fulfilled, the Break-up Fees provide the Purchaser compensation for such costs and loss opportunity.
Taking into account (i) the time, resources and costs incurred by the Purchaser in assessing, negotiating and entering into of the transactions contemplated under the Provisional Agreements (including, but not limited to, the legal and professional fees and the costs of funding for the initial deposits and further deposits paid and to be paid by the
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LETTER FROM THE BOARD
Purchaser pursuant to the Provisional Agreements (now the Formal Agreements)); (ii) it is conventional for transactions involving the sale and purchase of real property to adopt an amount representing 10% of the consideration as deposit and deposits of 10% are routinely forfeited to vendors when purchasers wrongly fail to complete; and (iii) the Vendors do have the right under the Provisional Agreements (now the Formal Agreements) to forfeit the initial deposit and further deposit (representing 10% of the Consideration) paid/payable by the Purchaser upon the Purchaser's failure to comply with the provisions of the Provisional Agreements (now the Formal Agreements), the Directors consider that the Break-up Fees (which also represents 10% of the Consideration) represent a fair and reasonable compensation to the Purchaser in the event that the Disposals cannot be proceeded due to the non-fulfilment of the Condition Precedent and, accordingly, consider that the Break-up Fees arrangement (including the amount of the Break-up Fees) is on normal commercial terms, fair and reasonable.
Based on the above, the Directors consider that the terms of the Provisional Agreements and the Formal Agreements (including the Consideration) are on normal commercial terms, fair and reasonable, and that the Disposals are in the interests of the Company and its Shareholders as a whole and the Break-up Fees arrangement is also in the interests of the Company and its Shareholders as a whole, in the context of the agreed terms of the Disposals, particularly having regard to the benefit to the Group in securing the Purchaser's commitment to the Disposals and the Purchaser's payments of the initial deposits and further deposits as financial protection to the Vendors.
FINANCIAL INFORMATION ABOUT THE PROPERTIES
Property A
Property A consists of the 27th Floor of Rykadan Capital Tower, with an aggregate gross floor area of approximately 12,024 square feet and the car parking spaces nos. P11, P12, P13 and P14 on the 1st Floor of Rykadan Capital Tower. As of the Latest Practicable Date, a portion of Property A with a gross floor area of approximately 3,688 square feet are held for the Company's own use as the headquarters and principal place of business in Hong Kong and the remaining portions of Property A are vacant and not subject to any tenancy or licence.
For the two financial years immediately preceding the date of the Provisional Agreement A, other than car parking space no. P14 and another portion of Property A with a gross floor area of approximately 8,336 square feet which had been leased out during such period, no part of Property A had been leased out.
The net losses before taxation and after taxation attributable to Property A for the two financial years ended 31 March 2023 and 31 March 2024 and the six months ended 30 September 2024 were approximately as follows:
LETTER FROM THE BOARD
| For the year ended 31 March | For the six months ended 30 September | ||
|---|---|---|---|
| 2023 | 2024 | ||
| HK$’000 | HK$’000 | HK$’000 (Note) | |
| Net loss before taxation | 5,871 | 5,172 | 36,030 |
| Net loss after taxation | 5,871 | 5,172 | 36,030 |
Note:
The increase in the net loss attributable to Property A was mainly due to the decrease in fair value of Property A.
Property B
Property B consists of the 28th Floor of Rykadan Capital Tower, with an aggregate gross floor area of approximately 12,024 square feet and the car parking spaces nos. P7, P8, P9 and P10 on the 1st Floor of Rykadan Capital Tower. As of the Latest Practicable Date, (i) a portion of Property B with a gross floor area of approximately 6,875 square feet are held for the Company's own use as the headquarters and principal place of business in Hong Kong; (ii) car parking spaces no. P9 and certain other portions of Property B with a total gross floor area of approximately 3,146 square feet are leased out; and (iii) the remaining portions of Property B are vacant and not subject to subject to any tenancies or licence.
The net losses before taxation and after taxation attributable to Property B for the two financial years ended 31 March 2023 and 31 March 2024 and the six months ended 30 September 2024 were approximately as follows:
| For the year ended 31 March | For the six months ended 30 September | ||
|---|---|---|---|
| 2023 | 2024 | ||
| HK$’000 | HK$’000 | HK$’000 (Note) | |
| Net loss before taxation | 3,774 | 4,067 | 21,199 |
| Net loss after taxation | 3,774 | 4,067 | 21,199 |
Note:
The increase in the net loss attributable to Property B was mainly due to the decrease in fair value of Property B.
The carrying value of the Properties as shown in the audited consolidated financial statements of the Company as at 31 March 2024 was approximately HK$186,217,000.
The Properties are subject to mortgages to secure bank borrowings granted to the Group. As at the Latest Practicable Date, the aggregate outstanding principal amount of the mortgage loan and all accrued interest thereon in respect of each of Property A and Property B amount to approximately HK$15,527,000.
LETTER FROM THE BOARD
FINANCIAL EFFECT OF THE DISPOSALS AND INTENDED USE OF PROCEEDS
The carrying value of the Properties based on the unaudited consolidated interim results of the Company and its subsidiaries as at 30 September 2024 and the unaudited consolidated management accounts of the Company as at 31 January 2025 was approximately HK$130,403,000 and HK$122,227,000 respectively. The Group is expected to record a gain of approximately HK$35,711,000 from the Disposals, being the difference between the aggregate Consideration of HK$163,526,400 and the carrying value of the Properties as at 31 January 2025 after deducting estate agent's commission, legal fees and ancillary expenses. The aforesaid gain on Disposals is for illustrative purpose only, the actual gain or loss as a result of the Disposals is subject to audit and therefore may be different from the amount mentioned above. Upon Completion, the Group will cease to receive gross rental income from the Properties, which amounted to approximately HK$1,027,000 for the year ended 31 March 2024. The payment of the Break-up Fees in the aggregate sum of HK$16,352,640, if materialized, will be expensed in the consolidated income statements for the Group, and will result in a loss of HK$16,352,640 for the Group.
Earnings
For the period ended 31 March 2024, the Group recorded an audited loss and loss attributable to owners of the Company for the year of approximately HK$176 million and HK$174 million, respectively. Based on the "Unaudited Pro Forma Financial Information of the Remaining Group" as set out in Appendix III to this circular, assuming the Completion had taken place on 1 April 2023, the unaudited pro forma consolidated loss and consolidated loss attributable to owners of the Company of the Remaining Group for the year ended 31 March 2024 would be approximately HK$197 million and HK$195 million, respectively.
Assets and liabilities
Following Completion, the assets and liabilities of the Properties will no longer be consolidated into the consolidated financial statements of the Group. According to the interim report of the Company for the period ended 30 September 2024, the unaudited consolidated total assets and total liabilities of the Group as at 30 September 2024 were approximately HK$995 million and HK$233 million, respectively. Based on the "Unaudited Pro Forma Financial Information of the Remaining Group" as set out in Appendix III to this circular, assuming the Completion had taken place on 30 September 2024, the unaudited pro forma consolidated total assets and total liabilities of the Remaining Group as at 30 September 2024 would be approximately HK$948 million and HK$159 million, respectively.
Use of proceeds
The net proceeds from the Disposals after deducting commission, legal fees and ancillary expenses of approximately HK$6 million in aggregate are estimated to be approximately HK$158 million. The Company intends to apply the net proceeds (i) as to approximately 32% towards full repayment of mortgage loans in respect of the Properties and the secured bank loan in the amount of approximately HK$20 million; (ii) as to approximately 30% towards the Group's general operational expenses such as office administrative expenses, salaries and maintenance of the existing business; (iii) as to
LETTER FROM THE BOARD
approximately 30% for business development of the Group; and (iv) the remaining towards settling professional fees such as audit fees, legal costs, financial advisers fees and financial printer fees, and for the Group's general working capital. Due to the uncertainty of the macro-economic environment, the Company will consider each new business development opportunity with due care and prudence.
LISTING RULES IMPLICATIONS
As the highest applicable percentage ratio in respect of the Disposals (on an aggregated basis) exceeds 75%, the Disposals, on an aggregated basis, constitute a very substantial disposal of the Company pursuant to Rule 14.06(4) of the Listing Rules and are, therefore, subject to reporting, announcement, circular and the Shareholders' approval requirements under Chapter 14 of the Listing Rules. An EGM will be convened and held for the Shareholders to consider and, if thought fit, approve, the Formal Agreements and the transactions contemplated thereunder.
As at the Latest Practicable Date, Tiger Crown, Mr. Chan and Mr. Ng beneficially owns 97,104,000 Shares, 33,700,000 Shares and 63,024,000 Shares respectively, representing approximately 25.86%, 8.98% and 16.79% respectively (and approximately 51.63% in aggregate) of the issued share capital of the Company. Each of Tiger Crown, Mr. Chan and Mr. Ng has undertaken to the Company that all the Shares in respect of which it/he is entitled to exercise voting rights or control the exercise thereof will be voted in favour of the ordinary resolution(s) of Shareholders to be proposed at the EGM to approve the Disposals.
To the best knowledge, information and belief of the Directors having made all reasonable enquires, no Shareholder or its close associate has any material interest in the Disposals and no Shareholder is required to abstain from voting on the resolution.
INFORMATION ON THE PURCHASER
The Purchaser is incorporated in Hong Kong with limited liability. To the best of the Directors' knowledge, information and belief having made reasonable enquiries, the principal business activities of the Purchaser are product design, manufacturing, sales and marketing and international import and export and the ultimate beneficial owner of the Purchaser is Mr. Edward Kwok Man Chan, who is an entrepreneur and the founder of the Purchaser.
As at the Latest Practicable Date, to the best of the Directors' knowledge, information and belief having made reasonable enquiries, (i) the Purchaser and its ultimate beneficial owners are third parties independent of the Company and its connected persons; and (ii) there is, and in the past twelve months immediately preceding the Latest Practicable Date, there has been, no material loan arrangement between (a) the Purchaser, any of its directors and/or ultimate beneficial owner; and (b) the Company, any connected person of the Company at the Company's level and/or any connected person of the Company at the Company's subsidiaries level involved in the Disposals.
LETTER FROM THE BOARD
INFORMATION ON THE GROUP AND THE VENDORS
The Group operates and invests in real estate development, real estate investment, distribution of building materials and asset, investment and fund management. Vendor A and Vendor B are indirect wholly-owned subsidiaries of the Company, both with the principal business of property holding and investment.
EGM
The EGM will be held at Room 1, 10/F, United Centre, 95 Queensway, Admiralty, Hong Kong on 17 April 2025, Thursday at 3:00 p.m. for the purpose of considering and, if thought fit, approving among other things, the Formal Agreements and the transactions contemplated thereunder.
The notice of the EGM is set out on pages EGM-1 to EGM-3 of this circular. A form of proxy for use at the EGM is also enclosed with this circular. Whether or not you intend to attend the EGM, you are requested to complete and sign the enclosed form of proxy in accordance with the instructions printed thereon and return the same to the Company's Hong Kong branch share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the EGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof (as the case may be) should you so wish. In such event, the form of proxy shall be deemed to be revoked.
The resolution to be proposed at the EGM to approve the Formal Agreements and the transactions contemplated thereunder will be voted by way of a poll at the EGM.
CLOSURE OF REGISTER OF MEMBERS
The register of members of the Company will be closed from 14 April 2025 to 17 April 2025, both dates inclusive, during which period no transfer of Shares will be registered. In order to qualify for attending and voting at the EGM, all transfer documents, accompanied by the relevant Share certificates, must be lodged with the Company's Hong Kong branch share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong for registration no later than 4:30 p.m. on 11 April 2025, Friday.
RECOMMENDATION
The Directors (including the non-executive Directors) are of the opinion that the terms of the Formal Agreements and the transactions contemplated thereunder are fair and reasonable, and are in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend the Shareholders to vote in favour of the resolution to be proposed at the EGM to approve the Formal Agreements and the transactions contemplated thereunder.
- 17 -
LETTER FROM THE BOARD
Completion of each Disposal is conditional upon the fulfillment of the Condition Prevent. Accordingly, the Disposals may or may not proceed. Shareholders and potential investors of the Company should therefore exercise caution when dealing in the securities of the Company.
ADDITIONAL INFORMATION
Your attention is also drawn to the additional information set out in the appendices to this circular.
Yours faithfully,
For and on behalf of the Board
Rykadan Capital Limited
宏基資本有限公司
Chan William
Chairman and Chief Executive of the Board
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APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
1. FINANCIAL INFORMATION OF THE GROUP
The audited consolidated financial statements of the Group for each of the three years ended 31 March 2022, 2023 and 2024 and the unaudited consolidated financial information of the Group for the six months ended 30 September 2024 are disclosed in the following documents which have been published on both the websites of the Stock Exchange (www.hkex.com.hk) and the website of the Company (www.rykadan.com), and can be accessible by the links as follows:
- the 2022 annual report of the Company for the year ended 31 March 2022 published on 28 July 2022 (pages 51 to 121); https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0728/2022072801398.pdf
- the 2023 annual report of the Company for the year ended 31 March 2023 published on 28 July 2023 (pages 50 to 119); https://www1.hkexnews.hk/listedco/listconews/sehk/2023/0728/2023072801283.pdf
- the 2024 annual report of the Company for the year ended 31 March 2024 published on 31 July 2024 (pages 49 to 111); https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0731/2024073100493.pdf
- the 2024 interim report of the Company for the six months ended 30 September 2024 published on 30 December 2024 (pages 12 to 39); https://www1.hkexnews.hk/listedco/listconews/sehk/2024/1230/2024123001217.pdf
2. INDEBTEDNESS STATEMENT
As at 31 January 2025, being the latest practicable date for the purpose of this statement of indebtedness prior to the printing of this circular, the Group had the following indebtedness:
Bank loans
As at 31 January 2025, the Group had unsecured and unguaranteed bank loan amounting to approximately HK$118.6 million, secured and guaranteed bank loans amounting to approximately HK$70.7 million. The bank loans were secured by mortgages over certain investment properties, property, plant and equipment and properties for sales of the Group with a total carrying amount of approximately HK$161.5 million.
Lease liabilities
As at 31 January 2025, the Group had lease liabilities amounting to approximately HK$3.1 million which were secured by rental deposits and guaranteed.
Contingent liabilities
As at 31 January 2025, the Group had no material contingent liabilities.
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
Save as aforesaid or as otherwise disclosed herein, and apart from intra-group liabilities and normal payables and accruals in the ordinary course of business of the Group, the Group did not have any other debt securities, term loans or other outstanding overdrafts or loans, or other similar indebtedness, mortgages, charges, guarantees, material capital commitment or other material contingent liabilities outstanding as at 31 January 2025.
3. WORKING CAPITAL
After taking into account the financial resources presently available to the Group, including cash and cash equivalent on hand, internally generated funds, available and existing banking facilities and the effects of the Disposals, and in the absence of unforeseen circumstances, the Directors after due and careful enquiry are of the opinion that the Group has sufficient working capital for its present requirements for at least twelve months from the date of publication of this circular. The Company has obtained the relevant letter as required under Rule 14.66(12) of the Listing Rules.
4. MATERIAL ADVERSE CHANGE
The Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 March 2024 (being the date which the latest published audited consolidated financial statements of the Group had been made up) up to the Latest Practicable Date.
5. FINANCIAL AND TRADING PROSPECTS OF THE GROUP
The Group always commits to its long-term strategy of managing its value-added investment portfolio, efficiently growing its asset value and monetising the investments within a three-to-five-year period to preserve value for its Shareholders.
Despite the challenges arising from market uncertainties and high financing costs which weigh on investor and consumer confidence, the Group will continue to adhere to its long-term investment principles by focusing on asset monetisation of its existing projects.
Meanwhile, with the aim of tapping a broader base of additional development capital and generating stable recurring fee income throughout the life of various development projects, the Group's asset, investment and fund management business will continue to leverage its track record and experience gained from previous real estate development projects to explore and cautiously re-deploy resources from completed projects to invest in new high-potential investments that can generate target returns and add value to the Shareholders.
The Group is adamant about preserving liquidity. To navigate through this complex macro-environment clouded with market uncertainties and declining asset prices, the Group relies on its prudent risk management to mitigate downside risks. Thorough risk management practices and oversight of its asset, investment and fund management business will enable the Group to optimise its income streams and protect its investments.
- I-2 -
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
The Group will proactively and cautiously strive for local and overseas opportunities to expand its asset, investment and fund management business to further diversify its investment portfolio and deliver quality performance to its Shareholders and project investors.
6. MANAGEMENT DISCUSSION AND ANALYSIS OF THE REMAINING GROUP
Set out below is the management discussion and analysis of the Remaining Group's business and performance for the three years ended 31 March 2024, 2023 and 2022 and for the six months ended 30 September 2024.
Liquidity, Financial Resources and Capital Structure
The management and control of the Remaining Group's financial, capital management and external financing functions are centralised at its headquarters in Hong Kong. The treasury policy of the Remaining Group is to adhere to the principle of prudent financial management to minimise financial and operational risks. The Remaining Group's objective is to maintain a balance between the continuity of funds and flexibility through the effective use of its internal financial resources and bank borrowings to finance its operations and expansion, as well as to manage its exposure to fluctuations in foreign currency exchange rates.
The Remaining Group has not entered into any foreign exchange hedging arrangement during the three years ended 31 March 2024, 2023 and 2022 and for the six months ended 30 September 2024. Nevertheless, the management of the Remaining Group has been and will continue to monitor the Remaining Group's foreign currency exposure of each business segment, and will consider hedging significant foreign currency exposure should the need arise. The Remaining Group also strives to reduce exposure to credit risk by regularly performing ongoing credit assessments and evaluations of the financial position of its customers. To manage the liquidity risk, the management of the Remaining Group closely monitors the sufficiency of cash and bank balances and the adequacy of funding from available committed credit facilities from lending banks.
The Remaining Group had cash and cash equivalents as at 30 September 2024, 31 March 2024, 31 March 2023 and 31 March 2022 denominated in the following currencies:
| As at 30 September 2024 | As at 31 March 2024 | As at 31 March 2023 | As at 31 March 2022 | |||||
|---|---|---|---|---|---|---|---|---|
| HK$'000 | Percentage | HK$'000 | Percentage | HK$'000 | Percentage | HK$'000 | Percentage | |
| US$ | 14,318 | 8% | 31,222 | 31% | 47,803 | 29% | 27,874 | 25% |
| HK$ | 150,996 | 84% | 55,721 | 56% | 34,642 | 21% | 40,844 | 37% |
| RMB | 8,577 | 5% | 8,531 | 8% | 33,637 | 20% | 31,404 | 29% |
| CAD | 3,098 | 2% | 3,375 | 3% | 45,557 | 27% | 3,849 | 3% |
| Others | 1,781 | 1% | 2,048 | 2% | 5,846 | 3% | 6,172 | 6% |
| 178,770 | 100% | 100,897 | 100% | 167,485 | 100% | 110,143 | 100% |
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
As at 30 September 2024, 31 March 2024, 31 March 2023 and 31 March 2022, the Remaining Group had the following bank borrowings, which were due based on scheduled repayments dates and all mainly to finance the property redevelopment projects, investment in Quarella Holdings Limited (“QHL”) and the Shouson Hill Project:
| | As at 30 September 2024
HK$’000 | As at 31 March 2024
HK$’000 | As at 31 March 2023
HK$’000 | As at 31 March 2022
HK$’000 |
| --- | --- | --- | --- | --- |
| Bank loans repayable on demand or due for repayment: | | | | |
| – Within one year | 120,000 | 154,605 | – | 5,570 |
| – After one year but within two years | – | – | 134,534 | 5,570 |
| – After two years but within five years | 18,403 | 18,522 | 81,388 | 224,472 |
| | 18,403 | 18,522 | 215,922 | 230,042 |
| Total | 138,403 | 173,127 | 215,922 | 235,612 |
| Denominated in: | | | | |
| HKD | 120,000 | 120,000 | 120,000 | 235,612 |
| USD | 18,403 | 53,127 | 95,922 | – |
| | 138,403 | 173,127 | 215,922 | 235,612 |
| Interest-bearing: | | | | |
| Fixed | 18,403 | 53,127 | 95,922 | – |
| Floating | 120,000 | 120,000 | 120,000 | 235,612 |
| | 138,403 | 173,127 | 215,922 | 235,612 |
Of the total bank borrowings of the Remaining Group, the bank loans of approximately HK$18 million, HK$53 million, HK$96 million and HK$116 million as at 30 September 2024, 31 March 2024, 31 March 2023 and 31 March 2022, respectively, were all secured by the properties for sale and investment properties. Further costs for developing the property redevelopment projects, the business of QHL and the Shouson Hill Project will be financed by unutilised banking facilities or internally generated funds.
As at 30 September 2024, 31 March 2024, 31 March 2023 and 31 March 2022, there are no seasonality of borrowing requirements for the Remaining Group.
– I-4 –
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
As at 30 September 2024, 31 March 2024, 31 March 2023 and 31 March 2022, the Remaining Group's current assets were HK$584 million, HK$570 million, HK$697 million and HK$593 million, respectively and the Remaining Group's current liabilities were HK$136 million, HK$170 million, HK$136 million and HK$263 million, respectively. The Remaining Group's current ratios, calculated by dividing the current assets by the current liabilities as at 30 September 2024, 31 March 2024, 31 March 2023 and 31 March 2022, were 4.29, 3.35, 5.13 and 2.25 respectively. The internally generated funds, together with unutilised banking facilities enable the Remaining Group to meet its business development needs.
The Remaining Group will cautiously seek new investment and development opportunities in order to balance risks and opportunities and maximise Shareholders' value.
Significant Investments
The Remaining Group did not hold any significant investment as at 30 September 2024, 31 March 2024, 31 March 2023 and 31 March 2022.
Material Acquisitions and Disposals
In September 2021, the Remaining Group entered into a subscription agreement under which the Remaining Group agreed to increase its capital commitment in Rykadan Real Estate Fund LP by HK$15,750,000. Upon completion of the subscription, the partnership interest indirectly held by the Company has been increased from approximately 3.53% to approximately 5.26%.
In September 2022, Worth Celestial Limited ("Worth Celestial") (a wholly-owned subsidiary of the Company) entered into a conditional sale and purchase agreement with Harbour Best Investments Limited ("Harbour Best") (a company jointly owned by a director of the Company and his spouse), in relation to the conditional disposal of 80% of the entire issued share capital of Vibrant Colour Holdings Limited ("Vibrant Colour") which was a wholly-owned subsidiary of Worth Celestial and indirectly owns a residential property in Shouson Hill, Hong Kong, and 80% of the amount of shareholder's loans owing by Vibrant Colour to Worth Celestial. Upon the disposal completion which took place in January 2023, the retained 20% equity interest of Vibrant Colour held by the Remaining Group is accounted for as interests in associates.
In July 2024, Worth Celestial entered into a sale and purchase agreement with a director of the Company and his spouse (collectively referred to as the "RH Vendors") in relation to the acquisition of 100% equity interests in Cosmo Kingdom Holdings Limited (a property holding company jointly owned by the RH Vendors with a luxury residential property in Hong Kong as its main asset), pursuant to which the RH Vendors have conditionally agreed to sell the sale shares and assign the sale loan, and Worth Celestial has conditionally agreed to purchase the sale shares and take up the assignment of the sale loan free from all encumbrances (the "Acquisition"). Given that the RH Vendors are connected persons of the Company, such proposed transactions constituted connected transactions as defined in Chapter 14A of the Listing Rules. The Acquisition was approved by the independent shareholders at an extraordinary general meeting of the Company held on 16
- I-5 -
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
September 2024. In November 2024, Worth Celestial and the RH Vendors have agreed that the revised long stop date shall be 30 April 2025 unless they agree to further revise such date in writing. The Acquisition has not been completed as at 30 September 2024 and as at the Latest Practicable Date.
Save as disclosed above, the Remaining Group had no other material acquisition and disposal during the three years ended 31 March 2024, 2023 and 2022 and the six months ended 30 September 2024.
Segmental Information
The principal activities of the Remaining Group are property development / asset, investment and fund management, property investment, and distribution of construction and interior decorative materials.
Property Development / Asset, Investment and Fund Management
The Remaining Group continued to promote and market its completed projects in Hong Kong and overseas during the six months ended 30 September 2024 and the three years ended 31 March 2024, 2023 and 2022. Highlights included developing certain high-potential overseas properties to broaden its investment portfolio and the successful delivery and monetisation of the Remaining Group's property redevelopment projects.
The Remaining Group's Monterey Park Towne Centre Project is currently in the planning phase as it adapts to the new zoning policies and recent changes in market conditions. Due to the complexities involved, the Remaining Group has engaged in ongoing negotiation with multiple stakeholders, including city planners, to adapt the project to state policies that promote affordable housing. The Remaining Group anticipates further discussion on a revised plan, with higher-density options.
The Graphite Square Project, in which the Remaining Group has a minority stake in the U.K., has received strong interest from offshore buyers. A significant portion of the available-for-sale units has been pre-sold to buyers. The Graphite Square Project is scheduled to be completed by the first half of 2025. A new phase to market the remaining units to affluent buyers has commenced.
The Remaining Group reinforced its efforts to market the Jaffe Road Project and the Wong Chuk Hang Project in Hong Kong. As of 30 September 2024, over 79% of the available-for-sale units of the Jaffe Road Project and over 59% of the available-for-sale units and car parking spaces of the Wong Chuk Hang Project were sold and handed over to buyers. The remaining units of these projects are being actively marketed to potential buyer.
During the years, the Remaining Group also continued to explore opportunities to expend to other property-related business fields and is dedicated to enhancing shareholders' returns through its asset, investment and fund management business. By broadening its capital base through collaborations with quality partners and carefully selecting property projects, the Remaining Group reinforces its financial position and makes its investment portfolio more diversified and resilient to the sluggish real estate market.
- I-6 -
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
Property Investment
For the three years ended 31 March 2024, 2023 and 2022 and the six months ended 30 September 2024, the Remaining Group holds several properties and hospitality operations in Hong Kong and Bhutan respectively. In Hong Kong, the Remaining Group retains various car parking spaces of Rykadan Capital Tower and a minority stake of the Shouson Hill Project for its own use and/or for earning stable rental income or potential capital appreciation. In Bhutan, the Remaining Group has invested in a 24-suite boutique resort located in Bhutan's Punakha Valley, for which operations and occupancy has been stable.
Distribution of Construction and Interior Decorative Materials
During the six months ended 30 September 2024 and the three years ended 31 March 2024, 2023 and 2022, the Remaining Group invests in a joint-venture, Quarella Group Limited ("QGL") which is a wholly-owned subsidiary of QHL and is a world leader in the design and manufacturing of quartz and marble-based engineered stone composite surfaces products. With its advanced factories and research and development centres in Italy, QGL's products are used in a number of prominent hotels, airports, train stations, commercial buildings and shopping malls in markets around the world.
Throughout the period, the macroeconomic recovery remains challenging due to the delay of large-scale projects. However, QGL has proactively responded to the situation by developing a new line of price-competitive products. These products are strategically targeting middle-class consumers and interior design communities across Greater China and Southeast Asia, demonstrating QGL's commitment to meeting evolving customers' requirements across different price points.
Employees and Remuneration Policies
As at 30 September 2024, 31 March 2024, 2023 and 2022, the total numbers of employees of the Remaining Group were 22, 22, 26 and 27 respectively. The Remaining Group offers an attractive remuneration policy, including reward to employees on a performance basis with reference to market rate, and subsidies for job-related continuing education. Total remuneration (including Directors' remuneration) for the six months ended 30 September 2024 and the three years ended 31 March 2024, 2023 and 2022 of the Remaining Group was HK$14 million, HK$33 million, HK$33 million and HK$29 million respectively. In-house and external training programs are also provided as and when required. With the aim to enable its employees to stay up-to-date with the latest industry trends and advance their professional growth, internally, the Remaining Group organises on-the job training related to industry knowledge and employees' job responsibilities to ensure continuous learning and improvement of knowledge and skills among employees, and externally, the Remaining Group encourages employees to explore training opportunities outside the Remaining Group.
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
Charges on the Remaining Group Assets
As at 30 September 2024, 31 March 2024, 2023 and 2022, banking facilities of the Remaining Group were secured by mortgages over:
| | 30 September 2024
HK$’000 | 31 March 2024
HK$’000 | 31 March 2023
HK$’000 | 31 March 2022
HK$’000 |
| --- | --- | --- | --- | --- |
| Investment properties | – | – | – | 198,000 |
| Properties for sale | 33,777 | 95,276 | 185,737 | 119,908 |
| Total | 33,777 | 95,276 | 185,737 | 317,908 |
Prospects
The Group is cautiously optimistic about the near-term outlook in the face of growing geopolitical tensions and rising costs. While it welcomes new stimulating measures and the beginning of the rate-cut cycle, geopolitical and trade tensions still pose many uncertainties, keeping the business environment challenging.
While modest increase in real estate market transactions and the Hong Kong Government's revamped Capital Investment Entrant Scheme (CIES) have slightly improved the investment sentiment in Hong Kong, the Group sees that it needs longer time for recovery to kick in. In contrast, the U.S.A. consumer spending and investment sentiment have fared more favourably, given its relatively resilient job market and low housing inventory. With a diversified investment portfolio, the Group will focus on projects that yield higher returns and apply measures to mitigate investment risks.
Regarding the hospitality business in Bhutan, with the local government's "high-value, low-impact" tourism policy, Bhutan will continue to attract wealthier investors. As Bhutan becomes the premier travel destination for the mindful, responsible and more affluent groups, the Group's Bhutan investment is expected to generate better returns. This demonstrates its investment team's experience and diligent selection process to identify promising projects for its investors.
While uneven recovery is expected to persist, the Group will leverage its experienced investment team to identify high-return projects and generate better Shareholder returns.
Gearing Ratio
As at 30 September 2024, 31 March 2024, 2023 and 2022, the Remaining Group's gearing ratio (net debts, as defined by total bank borrowings less bank deposits and cash on hand, to total assets) was Nil, 7.5%, 4.2 and 9% respectively.
APPENDIX I
FINANCIAL INFORMATION OF THE GROUP
Exposure to Fluctuations in Exchange Rates and Interest Rates and Corresponding Hedges
The Remaining Group operates in various regions with different foreign currencies including US$, GBP, CAD and RMB.
Certain of the Remaining Group's bank borrowings have been made at floating rates.
The Remaining Group has not implemented any foreign currencies and interest rates hedging policy. However, the management of the Remaining Group will monitor foreign currencies and interest rates for each business segment and consider appropriate hedging policies in future when necessary.
Contingent Liabilities
As at 30 September 2024, 31 March 2024, 2023 and 2022, the Company has issued guarantees to banks in respect of banking facilities granted to certain indirect subsidiaries of HK$18,403,000, HK$54,233,000, HK$117,219,000 and HK$178,275,000 and an associate of HK$12,600,000, HK$12,600,000, HK$12,600,000 and HK$20,000,000, respectively. Such banking facilities were utilised by its subsidiaries to the extent of HK$18,403,000, HK$53,127,000, HK$95,922,000 and HK$115,612,000 and the associate to the extent of HK$11,340,000, HK$11,592,000, HK$12,096,000 and Nil respectively as at 30 September 2024, 31 March 2024, 2023 and 2022.
The Directors do not consider it probable that a claim will be made against the Company under any of the guarantees.
The Company has not recognised any deferred income in respect of these guarantees as their fair values cannot be reliably measured using observable market data and no transaction price was incurred.
Capital Commitments
| | 30 September 2024
HK$’000 | 31 March 2024
HK$’000 | 31 March 2023
HK$’000 | 31 March 2022
HK$’000 |
| --- | --- | --- | --- | --- |
| Authorised and not contracted for | 645,055 | 649,817 | 934,582 | 1,023,264 |
| Contracted for | 84,988 | 32,594 | 51,677 | 69,501 |
| | 730,043 | 682,411 | 986,259 | 1,092,765 |
The above commitments include mainly the acquisition of a residential property project and construction related costs to be incurred in respect of the Remaining Group's development of its properties in various locations.
APPENDIX II
FINANCIAL INFORMATION OF THE PROPERTIES
A. UNAUDITED PROFIT OR LOSS STATEMENTS ON THE IDENTIFIABLE NET INCOME STREAM OF THE REVENUE-GENERATING PROPERTIES
In accordance with Rule 14.68(2)(b)(i) of the Listing Rules, the unaudited profit or loss statements on the identifiable net income stream of the Revenue-generating Properties for each of the years ended 31 March 2022, 2023 and 2024, the six months ended 30 September 2024 and its comparative figures for the six months ended 30 September 2023 (the "Unaudited Profit or Loss Statements") and its basis of preparation are set out below.
The Unaudited Profit or Loss Statements are prepared by the Directors solely for the purpose of inclusion in this circular in connection with the proposed disposal of the Properties. Deloitte Touche Tohmatsu (the "reporting accountants") were engaged to review the Unaudited Profit or Loss Statements in accordance with Hong Kong Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" and with reference to Practice Note 750 "Review of Financial Information under the Hong Kong Listing Rules for a Very Substantial Disposal" issued by the Hong Kong Institute of Certified Public Accountants.
A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable the reporting accountants to obtain assurance that the reporting accountants would become aware of all significant matters that might be identified in an audit. Accordingly, the reporting accountants do not express an audit opinion.
| For the year ended 31 March | For the six months ended 30 September | ||||
|---|---|---|---|---|---|
| 2022 | 2023 | 2024 | 2023 | 2024 | |
| HK$'000 | HK$'000 | HK$'000 | HK$'000 | HK$'000 | |
| Revenue | 4,098 | 1,115 | 1,027 | 532 | 486 |
| Administrative and other operating expenses | (1,284) | (1,415) | (1,475) | (730) | (738) |
| Finance costs | (1,246) | (1,917) | (2,763) | (1,376) | (1,163) |
| Increase (decrease) in fair value on investment properties | 4,000 | (6,000) | (4,600) | (2,100) | (55,100) |
| Profit (loss) before taxation | 5,568 | (8,217) | (7,811) | (3,674) | (56,515) |
Basis of preparation of the Unaudited Profit or Loss Statements
The Unaudited Profit or Loss Statements have been prepared solely for the purpose of inclusion in the circular in connection with the proposed disposal of the Properties in accordance with Rule 14.68(2)(b)(i) of the Listing Rules and in accordance with the relevant
APPENDIX II
FINANCIAL INFORMATION OF THE PROPERTIES
accounting policies adopted by the Company in the preparation of the consolidated financial statements of the Company and its subsidiaries (the "Group") for the year ended 31 March 2024, which conform with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants. The Unaudited Profit or Loss Statements have been prepared under the historical cost convention. The Unaudited Profit or Loss Statements neither contain sufficient information to constitute a complete set of financial statements as defined in Hong Kong Accounting Standard 1 (Revised) "Presentation of Financial Statements" nor a set of financial statements as defined in Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants, and that it should be read in connection with the Group's relevant published annual consolidated financial statements.
B. VALUATION OF THE PROPERTIES
The valuation report of the Properties as at 31 January 2025 is disclosed in Appendix IV to this circular.
C. PROPERTIES RECONCILIATION STATEMENT FOR THE PROPERTIES PURSUANT TO RULE 5.07 OF THE LISTING RULES
The Properties have been valued by Knight Frank Petty Limited, an independent property valuer, the full text of the property valuation report in connection with the valuation of the Properties as at 31 January 2025 is set out in Appendix IV to this circular.
The statement below shows the reconciliation of the carrying amount and the valuation of the Properties pursuant to Rule 5.07 of the Listing Rules:
| HK$'000 | |
|---|---|
| The carrying amount (stated at cost less accumulated depreciation and at fair value) of the Properties as at 31 March 2024 | 186,217 |
| Less: depreciation during the period from 1 April 2024 to 31 January 2025 | (1,189) |
| Net valuation deficit | (28,728) |
| Market value of the Properties as at 31 January 2025 as set out in the property valuation report in Appendix IV to this circular | 156,300 |
- II-2 -
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE REMAINING GROUP
INTRODUCTION
The following is the unaudited pro forma financial information of the Remaining Group, comprising the unaudited pro forma consolidated income statement and unaudited pro forma consolidated net assets statement of the Remaining Group (the "Unaudited Pro Forma Financial Information") which is prepared to illustrate the effect of the Disposals on the Group's financial position as at 30 September 2024; as if the Disposals had taken place on 30 September 2024, and on the Group's financial performance for the year ended 31 March 2024, as if the Disposals had taken place on 1 April 2023.
The unaudited pro forma consolidated income statement of the Remaining Group is prepared based on the audited consolidated income statement of the Group for the year ended 31 March 2024, which has been extracted from the published annual report of the Company for the year ended 31 March 2024 after making certain pro forma adjustments resulting from the Disposals.
The unaudited pro forma consolidated net assets statement of the Remaining Group is prepared based on the unaudited consolidated statement of financial position of the Group as at 30 September 2024, which has been extracted from the published interim report of the Company for the six months ended 30 September 2024 after making certain pro forma adjustments resulting from the Disposals.
The Unaudited Pro Forma Financial Information is prepared based on the aforesaid historical data after giving effect to the pro forma adjustments described below in the accompanying notes that are (i) directly attributable to the Disposals; and (ii) factually supportable.
The Unaudited Pro Forma Financial Information is prepared by the Directors based on a number of assumptions, estimates, uncertainties and currently available information, and is provided for illustrative purposes only. Accordingly, as a result of the nature of the Unaudited Pro Forma Financial Information, it may not give a true picture of the actual financial position and results of operation of the Remaining Group had the Disposals actually occurred on the dates indicated herein. Furthermore, the Unaudited Pro Forma Financial Information does not purport to predict the Remaining Group's future financial position and results of operation.
The Unaudited Pro Forma Financial Information should be read in conjunction with the financial information of the Group as set out in Appendix I of this circular and other financial information included elsewhere in this circular.
- III-1 -
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE REMAINING GROUP
A. UNAUDITED PRO FORMA CONSOLIDATED INCOME STATEMENT OF THE REMAINING GROUP
| The Group for the year ended 31 March 2024 | Pro forma adjustments | Unaudited pro forma total for the Remaining Group for the year ended 31 March 2024 | ||||
|---|---|---|---|---|---|---|
| HK$'000 (Note 1) | HK$'000 (Note 2) | HK$'000 (Note 3) | HK$'000 (Note 4) | HK$'000 (Note 5) | HK$'000 | |
| Revenue | 104,388 | (1,027) | - | - | - | 103,361 |
| Cost of sales and services | (131,690) | - | - | - | - | (131,690) |
| Gross loss | (27,302) | (1,027) | - | - | - | (28,329) |
| Other revenue | 6,718 | - | - | - | - | 6,718 |
| Other net (loss) gain | (3,883) | - | - | 38,682 | - | 34,799 |
| Selling and marketing expenses | (4,138) | - | - | - | - | (4,138) |
| Administrative and other operating expenses | (44,397) | 1,475 | (5,588) | - | 1,427 | (47,083) |
| Loss from operations | (73,002) | 448 | (5,588) | 38,682 | 1,427 | (38,033) |
| Decrease in fair value investment properties | (4,316) | 4,600 | - | (67,400) | - | (67,116) |
| (77,318) | 5,048 | (5,588) | (28,718) | 1,427 | (105,149) | |
| Finance costs | (15,713) | 2,763 | - | - | 4,188 | (8,762) |
| Share of result of associates | (35,216) | - | - | - | - | (35,216) |
| Share of result of joint ventures | (12,444) | - | - | - | - | (12,444) |
| Impairment losses on interests in joint ventures | (33,200) | - | - | - | - | (33,200) |
| Loss before taxation | (173,891) | 7,811 | (5,588) | (28,718) | 5,615 | (194,771) |
| Income tax expense | (2,275) | - | - | - | - | (2,275) |
| Loss for the year | (176,166) | 7,811 | (5,588) | (28,718) | 5,615 | (197,046) |
| Attributable to: | ||||||
| - Owners of the Company | (173,886) | 7,811 | (5,588) | (28,718) | 5,615 | (194,766) |
| - Non-controlling interests | (2,280) | - | - | - | - | (2,280) |
| (176,166) | 7,811 | (5,588) | (28,718) | 5,615 | (197,046) |
- III-2 -
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE REMAINING GROUP
Notes:
-
The amounts are extracted from the audited consolidated income statement for the year ended 31 March 2024 as set out in the published annual report of the Company for the year ended 31 March 2024.
-
The adjustment represents the exclusion of the financial performance attributable to the Revenue-generating Properties for the year ended 31 March 2024, assuming the Disposals had taken place on 1 April 2023, which are extracted from the unaudited profit or loss statement for the year ended 31 March 2024 on the identifiable net income stream of the Revenue-generating Properties as set out in Appendix II to this circular.
-
The adjustment represents the recognition of the estimated transaction costs of approximately HK$5,588,000, including but not limited to estate agent's commission, legal fees and ancillary expenses, which are directly attributable to the Disposals as estimated by the Directors.
-
The adjustment reflects the gain on the disposal of the Properties, assuming the Disposals had taken place on 1 April 2023, excluding the estimated professional fees and other expenses directly attributable to the Disposals.
HK$'000
Calculation of pro forma gain on the Disposals:
Cash consideration
163,526
Less: Pro forma adjusted carrying amount of the Properties as at 1 April 2023, representing:
(124,844)
- carrying amount of the Properties as at 1 April 2023
- fair value adjustments on Revenue-generating Properties upon disposal
(192,244)
67,400
Pro forma gain on the Disposals
38,682
-
The adjustment reflects the reversal of depreciation and finance costs of the properties classified as property, plant and equipment, assuming the Disposals had taken place on 1 April 2023, thereby excluding the depreciation and finance costs recognised for the year ended 31 March 2024.
-
The pro forma adjustment 2, 3, 4 and 5 are not expected to have a continuing effect on the unaudited pro forma consolidated income statement of the Remaining Group.
-
III-3 -
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL
INFORMATION OF THE REMAINING GROUP
B. UNAUDITED PRO FORMA CONSOLIDATED NET ASSETS STATEMENT OF THE REMAINING GROUP
| The Group as at 30 September 2024 | Pro forma adjustments | Unaudited pro forma total for the Remaining Group as at 30 September 2024 | |||||
|---|---|---|---|---|---|---|---|
| HK$'000 (Note 1) | HK$'000 (Note 2) | HK$'000 (Note 3) | HK$'000 (Note 4) | HK$'000 (Note 5) | HK$'000 (Note 6) | HK$'000 | |
| Non-current assets | |||||||
| Investment properties | 99,200 | (96,100) | - | - | - | - | 3,100 |
| Other property, plant and equipment | 33,143 | (32,499) | - | - | - | - | 644 |
| Right-of-use assets | 3,114 | - | - | - | - | - | 3,114 |
| Interests in associates | 174,998 | - | - | - | - | - | 174,998 |
| Interests in joint ventures | 182,462 | - | - | - | - | - | 182,462 |
| Financial assets measured at fair value through other comprehensive income | - | - | - | - | - | - | - |
| Total non-current assets | 492,917 | (128,599) | - | - | - | - | 364,318 |
| Current assets | |||||||
| Properties for sale | 335,390 | (1,804) | - | - | - | - | 333,586 |
| Inventories | 801 | - | - | - | - | - | 801 |
| Trade receivables | 23,089 | - | - | - | - | - | 23,089 |
| Other receivables, deposits and prepayments | 7,413 | - | - | - | - | - | 7,413 |
| Loan to an associate | 40,000 | - | - | - | - | - | 40,000 |
| Bank deposits and cash on hand | 95,587 | - | (169) | 163,526 | (5,588) | (74,586) | 178,770 |
| Total current assets | 502,280 | (1,804) | (169) | 163,526 | (5,588) | (74,586) | 583,659 |
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL
INFORMATION OF THE REMAINING GROUP
| The Group as at 30 September 2024 | Pro forma adjustments | Unaudited pro forma total for the Remaining Group as at 30 September 2024 | |||||
|---|---|---|---|---|---|---|---|
| HK$'000 (Note 1) | HK$'000 (Note 2) | HK$'000 (Note 3) | HK$'000 (Note 4) | HK$'000 (Note 5) | HK$'000 (Note 6) | ||
| Current liabilities | |||||||
| Trade and other payables | 14,484 | - | (169) | - | - | - | 14,315 |
| Contract liabilities | 321 | - | - | - | - | - | 321 |
| Bank loans | 194,586 | - | - | - | - | (74,586) | 120,000 |
| Lease liabilities | 545 | - | - | - | - | - | 545 |
| Tax payable | 1,205 | - | - | - | - | - | 1,205 |
| Total current liabilities | 211,141 | - | (169) | - | - | (74,586) | 136,386 |
| Net current assets | 291,139 | (1,804) | - | 163,526 | (5,588) | - | 447,273 |
| Total assets less current liabilities | 784,056 | (130,403) | - | 163,526 | (5,588) | - | 811,591 |
| Non-current liabilities | |||||||
| Bank loans | 18,403 | - | - | - | - | - | 18,403 |
| Lease liabilities | 2,723 | - | - | - | - | - | 2,723 |
| Deferred tax liabilities | 1,058 | - | - | - | - | - | 1,058 |
| Total non-current liabilities | 22,184 | - | - | - | - | - | 22,184 |
| Net assets | 761,872 | (130,403) | - | 163,526 | (5,588) | - | 789,407 |
- III-5 -
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE REMAINING GROUP
Notes:
-
The amounts are extracted from the unaudited consolidated statement of financial position of the Group as at 30 September 2024 as set out in the published unaudited interim financial report of the Company for the six months ended 30 September 2024.
-
The adjustment represents the exclusion of the carrying value of the Properties as at 30 September 2024, assuming the Disposals had taken place on 30 September 2024.
-
The adjustment represents the refund of deposits received from tenants of approximately HK$169,000 upon the disposal of the Revenue-generating Properties.
-
The adjustment reflect the cash consideration received upon completion of the Disposals amounting to HK$163,526,000 as stated in the Formal Agreements with the Purchaser.
-
The adjustment represents the recognition of the estimated transaction costs of approximately HK$5,588,000, including but not limited to estate agent's commission, legal fees and ancillary expenses, which are directly attributable to the Disposals as estimated by the Directors.
-
The adjustment represents the exclusion of the carrying value of the bank loan that is pledged or secured by the Properties as at 30 September 2024, assuming the Disposals had taken place on 30 September 2024 and the bank loan had been repaid accordingly.
-
Except for the Disposals, no other adjustment has been made to the Unaudited Pro Forma Financial Information to reflect any trading results or other transactions of the Group entered into subsequent to 30 September 2024.
-
III-6 -
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE REMAINING GROUP
C. REPORTING ACCOUNTANTS' REPORT ON UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following is the text of the independent reporting accountants' assurance report received from Deloitte Touche Tohmatsu, Certified Public Accountants, Hong Kong, the reporting accountants of the Company, in respect of the Group's unaudited pro forma financial information prepared for the purpose of incorporation in this circular.
Deloitte.
德勤
INDEPENDENT REPORTING ACCOUNTANTS' ASSURANCE REPORT ON THE COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION
To the Directors of Rykadan Capital Limited
We have completed our assurance engagement to report on the compilation of unaudited pro forma financial information of Rykadan Capital Limited (the "Company") and its subsidiaries (hereinafter collectively referred to as the "Group") by the directors of the Company (the "Directors") for illustrative purposes only. The unaudited pro forma financial information consists of the unaudited pro forma consolidated income statement for the year ended 31 March 2024, the unaudited pro forma consolidated net assets statement as at 30 September 2024, and related notes as set out on pages III-1 to III-6 of Appendix III to the circular issued by the Company dated 27 March 2025 (the "Circular"). The applicable criteria on the basis of which the Directors have compiled the unaudited pro forma financial information are described on pages III-1 to III-6 of Appendix III to the Circular.
The unaudited pro forma financial information has been compiled by the Directors to illustrate the impact of the Disposals of the Properties on the Group's financial performance for the year ended 31 March 2024 and the Group's financial position as at 30 September 2024 as if the transaction had taken place at 1 April 2023 and 30 September 2024 respectively. As part of this process, information about the Group's financial performance and financial position has been extracted by the Directors from the Group's financial statements for the year ended 31 March 2024 and Group's unaudited interim financial report for the six months ended 30 September 2024, on which an auditor's report and no review report have been published, respectively.
Directors' Responsibilities for the Unaudited Pro Forma Financial Information
The Directors are responsible for compiling the unaudited pro forma financial information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules") and with reference to Accounting Guideline 7 "Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars" ("AG 7") issued by the Hong Kong Institute of Certified Public Accountants (the "HKICPA").
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE REMAINING GROUP
Our Independence and Quality Management
We have complied with the independence and other ethical requirements of the “Code of Ethics for Professional Accountants” issued by the HKICPA, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior.
Our firm applies Hong Kong Standard on Quality Management (HKSQM) 1 “Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements” issued by the HKICPA, which requires the firm to design, implement and operate a system of quality management including policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.
Reporting Accountants’ Responsibilities
Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the unaudited pro forma financial information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the unaudited pro forma financial information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.
We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements 3420 “Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus” issued by the HKICPA. This standard requires that the reporting accountants plan and perform procedures to obtain reasonable assurance about whether the Directors have compiled the unaudited pro forma financial information in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the unaudited pro forma financial information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the unaudited pro forma financial information.
The purpose of unaudited pro forma financial information included in an investment circular is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the Group as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the event or transaction at 1 April 2023 or 30 September 2024 would have been as presented.
A reasonable assurance engagement to report on whether the unaudited pro forma financial information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the
- III-8 -
APPENDIX III
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE REMAINING GROUP
Directors in the compilation of the unaudited pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:
- the related pro forma adjustments give appropriate effect to those criteria; and
- the unaudited pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information
The procedures selected depend on the reporting accountants' judgement, having regard to the reporting accountants' understanding of the nature of the Group, the event or transaction in respect of which the unaudited pro forma financial information has been compiled, and other relevant engagement circumstances.
The engagement also involves evaluating the overall presentation of the unaudited pro forma financial information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Opinion
In our opinion:
(a) the unaudited pro forma financial information has been properly compiled on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purposes of the unaudited pro forma financial information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.
Deloitte Touche Tohmatsu
Certified Public Accountants
Hong Kong
27 March 2025
- III-9 -
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
The following is the text of a valuation report prepared for the purpose of incorporation in this circular received from Knight Frank Petty Limited, an independent valuer, in connection with their valuation as at 31 January 2025 of the Properties located in Hong Kong.
Knight Frank Petty Limited
4/F, Shui On Centre
6-8 Harbour Road
Wanchai, Hong Kong
27 March 2025
The Board of Directors
Rykadan Capital Limited
Room 2701, 27/F, Rykadan Capital Tower
135 Hoi Bun Road, Kwun Tong
Hong Kong
Dear Sirs
VALUATION OF 27/F AND 28/F WITH 8 CAR PARKING SPACES OF RYKADAN CAPITAL TOWER LOCATED AT NO. 135 HOI BUN ROAD, KOWLOON, HONG KONG (COLLECTIVELY, THE “PROPERTIES”)
In accordance with the instructions to us from Rykadan Capital Limited (the "Company", together with its subsidiaries, the "Group"), to value the Properties, we confirm that we have made relevant enquiries and carried out searches and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the market values of the Properties as at 31 January 2025 (the "Valuation Date") for the purpose of incorporation into the circular issued by the Company on the date thereof.
Basis of Valuation
In arriving at our opinion of the market values of the Properties, we followed "The HKIS Valuation Standards 2020" issued by The Hong Kong Institute of Surveyors ("HKIS") and "The RICS Valuation - Global Standards" issued by the Royal Institution of Chartered Surveyors ("RICS"). Under the said standards, market value is defined as: -
"the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm's length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion."
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
Market value is also understood as the estimated exchange price of an asset without regard to the seller's costs of sale or the buyer's costs of purchase and without adjustment for any taxes payable by either party as a direct result of the transaction.
Market value is the most probable price reasonably obtainable in the market on the valuation date in keeping with the market value definition. It is the best price reasonably obtainable by the seller and the most advantageous price reasonably obtainable by the buyer. This estimate specifically excludes an estimated price inflated or deflated by special terms or circumstances such as atypical financing, sale and leaseback arrangements, special considerations or concessions granted by anyone associated with the sale, or any element of value available only to a specific owner or purchaser.
Our valuation complies with the requirements set out in "The HKIS Valuation Standards 2020" issued by HKIS and "RICS Valuation – Global Standards" issued by RICS and Chapter 5 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited ("Listing Rules").
Our valuation is based on 100% of the leasehold interest in the Properties.
Valuation Methodology
Our valuation has been undertaken using appropriate valuation methodology and our professional judgement. In arriving at the market values of the Properties, we have considered the market approach as relevant sale transactions are available in the open market. We have adopted the market approach on the basis of a collation and analysis of appropriate comparable transactions. To ensure fairness and reasonability of our valuation, we have made appropriate adjustments to reflect the differences between the Properties and the selected comparable properties. The considered adjustments include location, building age, building quality, time of transaction, size and other material factors.
Expertise
The valuer, on behalf of Knight Frank Petty Limited, with the responsibility for this report is Mr. Jason Fung MRICS MHKIS RPS(GP) MCIREA RICS Registered Valuer who has over 17 years of valuation experiences. We confirm that the valuer meets the requirements of HKIS Valuation Standards and the RICS Valuation - Global Standards, having sufficient current knowledge of the particular market and the skills and understanding to undertake the valuation competently. Our valuation is prepared in an unbiased and professional manner.
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
Valuation Assumptions and Conditions
Our valuation is subject to the following assumptions and conditions:
Title Documents and Encumbrances
We have conducted relevant land search from the Land Registry. We have not, however, examined the original documents to verify ownership or to ascertain the existence of any amendment which does not appear on the copies handed to us. In our valuation, we have assumed a good and marketable title and that all documentation is satisfactorily drawn. We have also assumed that the Properties are not subject to any unusual or onerous covenants, restrictions, encumbrances or outgoing. These assumptions are considered valid by the Company.
Disposal Costs and Liabilities
No allowance has been made in our report for any charges, mortgages or amounts owing on the Properties nor for any expenses or taxation which may be incurred in effecting a sale.
Sources of Information
We have relied to a very considerable extent on information given by the Company, such as floor areas, floor plans, leasing information and all other relevant matters. We have not verified the correctness of any information, whether in writing or verbally by yourselves, your representatives or by your legal or professional advisers or by any (or any apparent) occupier of the property interests or contained on the register of title. We assume that this information is complete and correct. We have had no reason to doubt the truth and accuracy of the information provided to us by the Group which is material to the valuations. We were also advised by the Group that no material facts have been omitted from the information provided.
Inspection
We have conducted internal and external inspection of the Properties on 4 December 2024. Inspection of the Properties was undertaken by Ms. Viviana Hon MRICS MHKIS RPS(GP), who has over 8 years of experience in valuing properties in Hong Kong. We have assumed in our valuation that the Properties were in reasonable conditions, and there is no unauthorised extension or structural alterations as at the Valuation Date, unless otherwise stated.
Identity of the Properties to be Valued
We have exercised reasonable care and skill to ensure that the Properties, identified by the property addresses in your instructions, are the Properties inspected by us and contained within our valuation report. If there is ambiguity as to the property addresses, or the extent of the Properties to be valued, this should be drawn to our attention in your instruction or immediately upon receipt of our report.
- IV-3 -
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
Properties Insurance
We have valued the Properties on the assumption that, in all respects, it is insurable against all usual risks including terrorism, flooding and rising water table at normal, commercially acceptable premiums.
Areas and Age
We have not carried out on-site measurements to verify the correctness of the site and floor areas of the Properties but have assumed that the site and floor areas shown on the documents and plans available to us are correct. Dimensions, measurements and areas included in the property valuation report are based on information provided to us and are, therefore, only approximations.
Structural and Services Condition
We have carried out a visual inspection only without any structural investigation or survey. During our limited inspection, we did not inspect any inaccessible areas. We are unable to confirm whether the Properties are free from urgent or significant defects or items of disrepair, or any deleterious materials have been used in the construction of the Properties. Our valuation has therefore been undertaken on the assumption that the Properties were in satisfactory condition and contains no deleterious materials and it is in sound order and free from structural faults, rot, infestation or other defects.
Ground Condition
We have assumed there to be no unidentified adverse ground or soil conditions and that the load bearing qualities of the sites of the Properties are sufficient to support the building constructed or to be constructed thereon; and that the services are suitable for any existing or future development. Our valuation is therefore prepared on the basis that no extraordinary expenses or delays will be incurred in this respect.
Environmental Issues
We are not environmental specialists and therefore we have not carried out any scientific investigations of sites or buildings to establish the existence or otherwise of any environmental contamination, nor have we undertaken searches of public archives to seek evidence of past activities that might identify potential for contamination. In the absence of appropriate investigations and where there is no apparent reason to suspect the potential for contamination, our valuation is prepared on the assumption that the Properties is unaffected. Where contamination is suspected or confirmed, but an adequate investigation has not been carried out and made available to us, then the valuation will be qualified.
Compliance with Relevant Ordinances and Regulations
We have assumed the Properties was constructed, occupied, and used in full compliance with, and without contravention of any ordinance, statutory requirement and notices except only where otherwise stated. We have further assumed that, for any use of the
- IV-4 -
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
Properties upon which this report is based, any and all required licenses, permits, certificates, consents, approvals, and authorisation have been obtained, expected only where otherwise stated.
Remarks
In accordance with our standard practice, we must state that this report and valuation is for the use of the party to whom it is addressed, and no responsibility is accepted to any third party for the whole or any part of its contents. We do not accept liability to any third party or for any direct or indirect consequential losses or loss of profits as a result of this report.
We have prepared the valuation based on information and data available to us as at the Valuation Date. It must be recognised changes in policy direction, mortgage requirements, social and international tensions could be immediate and have sweeping impact on the real estate market apart from typical market variations. It should therefore be noted that any market violation, policy, geopolitical and social changes or other unexpected incidents after the Valuation Date may affect the value of the Properties.
Currency
Unless otherwise stated, all money amounts stated in our valuations are in Hong Kong Dollars (HK$).
Area Conversion
The area conversion factors in this report are taken as follows:
1 sq m = 10.764 sq ft
We enclose herewith our valuation report.
Yours faithfully
For and on behalf of
Knight Frank Petty Limited
Jason Fung
MRICS MHKIS RPS(GP) MCIREA RICS Registered Valuer
Senior Director
Valuation & Advisory
Note: Mr. Jason Fung is a qualified valuer who has about 17 years of extensive experiences in valuation of properties including development sites, residential, commercial, industrial properties in Hong Kong, the PRC and Asia Pacific region for various valuation purposes.
- IV-5 -
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
VALUATION
Property interests held by the Group for sale in Hong Kong
| Property No. | Property Interest | Description and tenure | Particulars of occupancy | Market value in existing state as at 31 January 2025 |
|---|---|---|---|---|
| 1. | 27^{th} Floor and 4 car parking spaces of Rykadan Capital Tower located at No. 135 Hoi Bun Road, Kowloon, Hong Kong | The property comprises office units of the whole 27^{th} Floor of a 25-storey office building namely Rykadan Capital Tower which was completed in 2013. The age of the building is about 12 years. | Portion of the property with gross floor area of 3,688 sq ft is owner occupied as headquarter and principal place of business in Hong Kong. | HK$77,800,000 (Hong Kong Dollars Seventy Seven Million and Eight Hundred Thousand Only) (100% interest attributable to the Group: HK$77,800,000) |
| 933/20000th share of and in the Remaining Portion of Kwun Tong Inland Lot No.526 | Rykadan Capital Tower is located in Kwun Tong within the CBD 2 area, in the locality which mainly comprise of Grade A office buildings and industrial buildings. | |||
| The gross floor area of the property is approximately 12,024 sq ft. | ||||
| The property also comprises 4 car parking spaces of P11, P12, P13 and P14 located on the 1^{st} Floor of Rykadan Capital Tower. | ||||
| The property is held under the government lease for a term of 99 years commencing on 1 July 1898 and statutorily extended to 30 June 2047 which is subject to an annual Government Rent equivalent to 3% of Rateable Value. |
Notes:
(1) Pursuant to the land register record obtained from the Land Registry, the registered owner of the property as at the Valuation Date is Win Expo Enterprises Limited, by Assignment dated 16 January 2014, registered vide memorial no. 14012900510108.
(2) The property falls within an area zoned for “Other Specified Uses” under the Approved Kwun Tong (South) Outline Zoning Plan No. S/K14S/26 gazetted on 26 July 2024.
(3) The property is subject to the following encumbrances:
(i) Occupation Permit No. KN29/2013(OP) of the development is registered vide memorial no. 13100800580015 dated 30 September 2013;
(ii) Deed of Mutual Covenant and Management Agreement with Plans of the development is registered vide memorial no.14012900510110 dated 16 January 2014;
(iii) The property is subject to a Mortgage in favour of DBS Bank (Hong Kong) Limited registered vide memorial no. 14020400260105 dated 16 January 2014;
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
(4) In the course of our valuation of the property by market approach, we have referred to sales transaction of office and car parking space, which are considered relevant to the property in terms of property type, location, timing of transaction and other property characteristics. Adjustments in terms of location, building age, building quality, size and other material factors have been considered to reflect the differences between the comparable transactions and the property, in arriving at the adopted price of the property.
(5) In the valuation, we have considered the following office comparables. The office sale comparables collected on an exhaustive basis are considered relevant to the property in terms of property type, location, timing of transaction and other property characteristics. These comparables are properties located in Kwun Tong with the building age within 10 years from the completion year of the property, with same use, same grade and transacted within 8 months on or before the Valuation Date. The unit rates of the comparable transactions range from about HK$6,291 to HK$7,611 per square foot on gross floor area basis. These comparables are deemed sufficient, appropriate and reasonable to derive a reliable opinion of value of the office portion of the property as at the Valuation Date.
| Comparable 1 | Comparable 2 | Comparable 3 | Comparable 4 | |
|---|---|---|---|---|
| Development | MG Tower | TG Place | Horizon Bay | Elite Centre |
| Address | 133 Hoi Bun Road | 10 Shing Yip Street | 32 Hung To Road | 22 Hung To Road |
| District | Kwun Tong | Kwun Tong | Kwun Tong | Kwun Tong |
| Year Built | 2011 | 2014 | 2023 | 2012 |
| Floor | 16/F | 29/F | 29/F | 28/F |
| Unit | A | G | 5-7 | 1-8 |
| Gross Floor Area (sq ft) | 3,722 | 1,787 | 2,772 | 11,875 |
| Transaction Date | 27 Sep 2024 | 23 Jul 2024 | 29 Jul 2024 | 21 Jun 2024 |
| Transacted Price (HK$) | 28,287,200 | 13,600,000 | 20,651,400 | 74,700,000 |
| Nature of Transaction | Agreement for Sale and Purchase | Agreement for Sale and Purchase | Agreement for Sale and Purchase | Agreement for Sale and Purchase |
| Unit Rate in GFA Basis | 7,600 | 7,611 | 7,450 | 6,291 |
| Adjustment | ||||
| Time | (5.2%) | (7.6%) | (7.6%) | (10.1%) |
| Location | Nil | (8.0%) | (5.0%) | (5.0%) |
| Building Age | 0.4% | (0.2%) | (2.0%) | 0.2% |
| Floor | 3.0% | (0.3%) | (0.3%) | Nil |
| Size | (10.4%) | (12.8%) | (11.6%) | (0.2%) |
| View | Nil | 5.0% | Nil | Nil |
| Total Adjustment | (12.1%) | (22.5%) | (24.1%) | (14.6%) |
| Adjusted Unit Rate in GFA Basis (HK$/ sq ft) | 6,677 | 5,894 | 5,651 | 5,371 |
We have made adjustments to reflect differences between the comparables and the subject of this valuation with the adjustment factors. We have adopted that the general basis of the adjustments are shown as follows.
For time adjustment, we are based on the Private Office - Price Indices from Rating and Valuation Department and we considered that if the time index of a comparable is higher than the subject property, a downward adjustment is made and vice versa; for location adjustment, we considered that if a comparable is in a better location, a downward adjustment is made and vice versa; for building age adjustment, if the building age of a comparable is older than the subject property, an upward adjustment is made and vice versa; for floor level adjustment, we consider that if the floor level of a comparable is higher than the subject property, a downward adjustment is made and vice versa; for size adjustment, we considered that if the size of a comparable property is smaller than the subject property, a downward adjustment is made and vice versa; and for view adjustment, if a comparable has a better view, a downward adjustment is made and vice versa.
In order to compare the office comparables with the office portion of the property, we have identified 28/F as the reference floor for this valuation. Based on the above adjustment mechanism, the adjusted average unit rate in GFA basis for the reference floor is HK$5,900. As the office portion of the Properties are in the same building, assuming all other factors remain constant, we have adopted -1% floor adjustment to reflect
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
the level difference between 27/F and 28/F (i.e. the reference floor). Therefore, the adjusted unit rate of the office portion of the property is HK$5,841 per sq ft, and the market value of the office portion of the property is estimated to be HK$70,200,000.
(6) In the valuation, we have considered the following car parking space comparables. The car parking space sale comparables collected on an exhaustive basis are considered relevant to the property in terms of property type, location and timing of transaction. These comparables are properties located in Kwun Tong and Kowloon Bay with the building age within 6 years from the completion year of the property, with same use and transacted within 6 months on or before the Valuation Date. The unit price of the adopted comparable transactions range from about HK$1,500,000 to HK$2,300,000 per lot. These comparables are deemed sufficient, appropriate and reasonable to derive a reliable opinion of value of the car park portion of property as at the Valuation Date.
| Comparable 1 | Comparable 2 | Comparable 3 | |
|---|---|---|---|
| Development | EGL Tower | EGL Tower | YHC Tower |
| Address | 83 Hung To Road | 83 Hung To Road | 1 Sheung Yuet Road |
| District | Kwun Tong | Kwun Tong | Kowloon Bay |
| Year Built | 2007 | 2007 | 2013 |
| Floor | 1/F | 1/F | 2/F |
| Unit | CPP22 | CPP23 | 35 |
| Transaction Date | 13 Aug 2024 | 13 Aug 2024 | 14 Oct 2024 |
| Nature of Transaction | Agreement for Sale and Purchase | Agreement for Sale and Purchase | Agreement for Sale and Purchase |
| Transacted Price (HK$) | 2,300,000 | 2,300,000 | 1,500,000 |
| Adjustment | |||
| Time | (7.4%) | (7.4%) | (3.5%) |
| Location | (5.0%) | (5.0%) | 5.0% |
| Building Age | 1.2% | 1.2% | Nil |
| Total Adjustment | (11.0%) | (11.0%) | 1.3% |
| Adjusted Price (HK$) | 2,048,000 | 2,048,000 | 1,520,000 |
We have made adjustments to reflect differences between the comparables and the subject of this valuation with the adjustment factors. We have adopted that the general basis of the adjustments are shown as follows.
For time adjustment, we are based on the Private Office - Price Indices from Rating and Valuation Department and we considered that if the time index of a comparable is higher than the subject property, a downward adjustment is made and vice versa; for location adjustment, we considered that if a comparable is in a better location, a downward adjustment is made and vice versa and for building age adjustment, if the building age of a comparable is older than the subject property, an upward adjustment is made and vice versa.
Based on the above adjustment mechanism, the adjusted average price of car parking space per lot is HK$1,900,000 and therefore, the market value of the car park portion (4 car parking spaces) of the property is estimated to be HK$7,600,000.
(7) Breakdowns on the market value of the property as at the Valuation Date are shown as follows:
Portion Market Value (HKD)
Office Portion 70,200,000
Car Park Portion 7,600,000
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
| Property No. | Property Interest | Description and tenure | Particulars of occupancy | Market value in existing state as at 31 January 2025 |
|---|---|---|---|---|
| 2. | 28^{th} Floor and 4 car parking spaces of Rykadan Capital Tower located at No. 135 Hoi Bun Road, Kowloon, Hong Kong | The property comprises office units of the whole 28^{th} Floor of a 25-storey office building namely Rykadan Capital Tower which was completed in 2013. The age of the building is about 12 years. | Portion of the property with gross floor area of 6,875 sq ft is owner occupied as headquarter and principal place of business in Hong Kong. | HK$78,500,000 (Hong Kong Dollars Seventy Eight Million and Five Hundred Thousand Only) |
| 933/20000th share of and in the Remaining Portion of Kwun Tong Inland Lot No.526 | Rykadan Capital Tower is located in Kwun Tong within the CBD 2 area, in the locality which mainly comprise of Grade A office buildings and industrial buildings. | Portion of the property with total gross floor area of 3,146 sq ft is subject to tenancies with the last tenancy expiring on 24 May 2026 yielding a total monthly rent of HK$65,820. | (100% interest attributable to the Group: HK$78,500,000) | |
| The gross floor area of the property is approximately 12,024 sq ft. | ||||
| The property also comprises 4 car parking spaces of P7, P8, P9 and P10 located on the 1^{st} Floor of Rykadan Capital Tower. | The remaining portion of the property is currently vacant. | |||
| The property is held under the government lease for a term of 99 years commencing on 1 July 1898 and statutorily extended to 30 June 2047 which is subject to an annual Government Rent equivalent to 3% of Rateable Value. |
Notes:
(1) Pursuant to the land register record obtained from the Land Registry, the registered owner of the Properties as at the Valuation Date is Prime Talent Development Limited, by Assignment dated 16 January 2014, registered vide memorial no. 14020400260091.
(2) The property falls within an area zoned for “Other Specified Uses” under the Approved Kwun Tong (South) Outline Zoning Plan No. S/K14S/26 gazetted on 26 July 2024.
(3) The property is subject to the following encumbrances:
(i) Occupation Permit No. KN29/2013(OP) of the development is registered vide memorial no. 13100800580015 dated 30 September 2013;
(ii) Deed of Mutual Covenant and Management Agreement with Plans of the development is registered vide memorial no.14012900510110 dated 16 January 2014;
(iii) The property is subject to a Mortgage in favour of DBS Bank (Hong Kong) Limited registered vide memorial no. 14020400260105 dated 16 January 2014;
- IV-9 -
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
(4) In the course of our valuation of the property by market approach, we have referred to sales transaction of office and car parking space, which are considered relevant to the property in terms of property type, location, timing of transaction and other property characteristics. Adjustments in terms of location, building age, building quality, size and other material factors have been considered to reflect the differences between the comparable transactions and the property, in arriving at the adopted price of the property.
(5) In the valuation, we have considered the following office comparables. The office sale comparables collected on an exhaustive basis are considered relevant to the property in terms of property type, location, timing of transaction and other property characteristics. These comparables are properties located in Kwun Tong with the building age within 10 years from the completion year of the property, with same use, same grade and transacted within 8 months on or before the Valuation Date. The unit rates of the comparable transactions range from about HK$6,291 to HK$7,611 per square foot on gross floor area basis. These comparables are deemed sufficient, appropriate and reasonable to derive a reliable opinion of value of the office portion of the property as at the Valuation Date.
| Comparable 1 | Comparable 2 | Comparable 3 | Comparable 4 | |
|---|---|---|---|---|
| Development | MG Tower | TG Place | Horizon Bay | Elite Centre |
| Address | 133 Hoi Bun Road | 10 Shing Yip Street | 32 Hung To Road | 22 Hung To Road |
| District | Kwun Tong | Kwun Tong | Kwun Tong | Kwun Tong |
| Year Built | 2011 | 2014 | 2023 | 2012 |
| Floor | 16/F | 29/F | 29/F | 28/F |
| Unit | A | G | 5-7 | 1-8 |
| Gross Floor Area (sq ft) | 3,722 | 1,787 | 2,772 | 11,875 |
| Transaction Date | 27 Sep 2024 | 23 Jul 2024 | 29 Jul 2024 | 21 Jun 2024 |
| Transacted Price (HK$) | 28,287,200 | 13,600,000 | 20,651,400 | 74,700,000 |
| Nature of Transaction | Agreement for Sale and Purchase | Agreement for Sale and Purchase | Agreement for Sale and Purchase | Agreement for Sale and Purchase |
| Unit Rate in GFA Basis Adjustment | 7,600 | 7,611 | 7,450 | 6,291 |
| Time | (5.2%) | (7.6%) | (7.6%) | (10.1%) |
| Location | Nil | (8.0%) | (5.0%) | (5.0%) |
| Building Age | 0.4% | (0.2%) | (2.0%) | 0.2% |
| Floor | 3.0% | (0.3%) | (0.3%) | Nil |
| Size | (10.4%) | (12.8%) | (11.6%) | (0.2%) |
| View | Nil | 5.0% | Nil | Nil |
| Total Adjustment | (12.1%) | (22.5%) | (24.1%) | (14.6%) |
| Adjusted Unit Rate in GFA Basis (HK$/ sq ft) | 6,677 | 5,894 | 5,651 | 5,371 |
We have made adjustments to reflect differences between the comparables and the subject of this valuation with the adjustment factors. We have adopted that the general basis of the adjustments are shown as follows.
For time adjustment, we are based on the Private Office - Price Indices from Rating and Valuation Department and we considered that if the time index of a comparable is higher than the subject property, a downward adjustment is made and vice versa; for location adjustment, we considered that if a comparable is in a better location, a downward adjustment is made and vice versa; for building age adjustment, if the building age of a comparable is older than the subject property, an upward adjustment is made and vice versa; for floor level adjustment, we consider that if the floor level of a comparable is higher than the subject property, a downward adjustment is made and vice versa; for size adjustment, we considered that if the size of a comparable property is smaller than the subject property, a downward adjustment is made and vice versa; and for view adjustment, if a comparable has a better view, a downward adjustment is made and vice versa.
APPENDIX IV
VALUATION REPORT ON THE PROPERTIES
Based on the above adjustment mechanism, the adjusted average unit rate in GFA basis for the office portion (as a reference floor) is HK$5,900 per sq ft, and therefore, the market value of the office portion of the property is estimated to be HK$70,900,000.
(6) In the valuation, we have considered the following car parking space comparables. The car parking space sale comparables collected on an exhaustive basis are considered relevant to the property in terms of property type, location and timing of transaction. These comparables are properties located in Kwun Tong and Kowloon Bay with the building age within 6 years from the completion year of the property, with same use and transacted within 6 months on or before the Valuation Date. The unit price of the adopted comparable transactions range from about HK$1,500,000 to HK$2,300,000 per lot. These comparables are deemed sufficient, appropriate and reasonable to derive a reliable opinion of value of the car park portion of property as at the Valuation Date.
| Comparable 1 | Comparable 2 | Comparable 3 | |
|---|---|---|---|
| Development | EGL Tower | EGL Tower | YHC Tower |
| Address | 83 Hung To Road | 83 Hung To Road | 1 Sheung Yuet Road |
| District | Kwun Tong | Kwun Tong | Kowloon Bay |
| Year Built | 2007 | 2007 | 2013 |
| Floor | 1/F | 1/F | 2/F |
| Unit | CPP22 | CPP23 | 35 |
| Transaction Date | 13 Aug 2024 | 13 Aug 2024 | 14 Oct 2024 |
| Nature of Transaction | Agreement for Sale and Purchase | Agreement for Sale and Purchase | Agreement for Sale and Purchase |
| Transacted Price (HK$) | 2,300,000 | 2,300,000 | 1,500,000 |
| Adjustment | |||
| Time | (7.4%) | (7.4%) | (3.5%) |
| Location | (5.0%) | (5.0%) | 5.0% |
| Building Age | 1.2% | 1.2% | Nil |
| Total Adjustment | (11.0%) | (11.0%) | 1.3% |
| Adjusted Price (HK$) | 2,048,000 | 2,048,000 | 1,520,000 |
We have made adjustments to reflect differences between the comparables and the subject of this valuation with the adjustment factors. We have adopted that the general basis of the adjustments are shown as follows.
For time adjustment, we are based on the Private Office - Price Indices from Rating and Valuation Department and we considered that if the time index of a comparable is higher than the subject property, a downward adjustment is made and vice versa; for location adjustment, we considered that if a comparable is in a better location, a downward adjustment is made and vice versa and for building age adjustment, if the building age of a comparable is older than the subject property, an upward adjustment is made and vice versa.
Based on the above adjustment mechanism, the adjusted average price of car parking space per lot is HK$1,900,000 and therefore, the market value of the car park portion (4 car parking spaces) of the property is estimated to be HK$7,600,000.
(7) Breakdowns on the market value of the property as at the Valuation Date are shown as follows:
Portion Market Value (HKD)
Office Portion 70,900,000
Car Park Portion 7,600,000
APPENDIX V
GENERAL INFORMATION
1. RESPONSIBILITY STATEMENT
This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.
2. DISCLOSURE OF INTERESTS
(1) Interests of Directors and chief executive
As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive of the Company in the Shares, underlying shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which were required to be (a) notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which the Directors and chief executive of the Company were taken or deemed to have pursuant to such provisions of the SFO); (b) entered in the register required to be kept under Section 352 of the SFO; or (c) notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix C3 to the Listing Rules (the "Model Code") were as follows:
Long position in the Shares
| Name | Nature of interest and capacity | Number of Shares | Approximate percentage of the issued share capital of the Company |
|---|---|---|---|
| Mr. Chan | Interest in a controlled corporation (Note 1) | 97,104,000 | 25.86 |
| Other interest (Note 2) | 18,153,211 | 4.83 | |
| Beneficial owner | 33,700,000 | 8.98 | |
| 148,957,211 | 39.67 | ||
| Mr. Ng | Beneficial owner | 63,024,000 | 16.79 |
| Lo Hoi Wah, Heywood | Beneficial owner | 64,166 | 0.02 |
APPENDIX V
GENERAL INFORMATION
Notes:
- Tiger Crown, which beneficially owns 97,104,000 Shares, is 100% owned by Rykadan Holdings Limited which in turn is 100% held by Mr. Chan. Mr. Chan is also the sole director of Tiger Crown and Rykadan Holdings Limited.
- Since Tiger Crown, Scenemay Holdings Limited, Mr. Chan, Li Chu Kwan and Li Wing Yin are regarded as a group of shareholders acting in concert to exercise their voting rights in the Company and are parties to an agreement under Section 317 of the SFO, pursuant to the provisions of SFO, each of them is deemed to be interested in the Shares owned by the other parties to the agreement. Hence, Mr. Chan is also deemed to be interested in the 18,153,211 Shares owned by Scenemay Holdings Limited.
- All the Shares shown in the table above are ordinary shares.
Save as disclosed above, as at the Latest Practicable Date, so far as is known to any Director and chief executive of the Company, none of the Directors or chief executive of the Company had any interests or short positions in any shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which would have to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which he was taken or deemed to have under such provisions of the SFO), or which were entered in the register required to be kept by the Company under Section 352 of the SFO, or which were required to be notified to the Company and the Stock Exchange pursuant to the Model Code.
(2) Interests of Substantial Shareholders
As at the Latest Practicable Date, so far as is known to the Directors or chief executive of the Company, the interests and short positions of the shareholders (other than a Director or chief executive of the Company) who had interests or short positions in the Shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were entered in the register required to be kept by the Company pursuant to Section 336 of the SFO, were as follows:
APPENDIX V
GENERAL INFORMATION
Long position
| Name | Nature of interest and capacity | Number of Shares | Approximate percentage of the issued share capital of the Company |
|---|---|---|---|
| Rykadan Holdings Limited | Interest in a controlled corporation (Notes 1 & 2) | 148,957,211 | 39.67 |
| Tiger Crown (Note 1) | Beneficial owner | 97,104,000 | 25.86 |
| Other interest (Note 2) | 51,853,211 | 13.81 | |
| 148,957,211 | 39.67 | ||
| Scenemay Holdings Limited (Note 3) | Beneficial owner | 18,153,211 | 4.83 |
| Other interest (Note 2) | 130,804,000 | 34.84 | |
| 148,957,211 | 39.67 | ||
| LI Chu Kwan | Interest in a controlled corporation (Note 3) | 18,153,211 | 4.83 |
| Other interest (Note 2) | 130,804,000 | 34.84 | |
| 148,957,211 | 39.67 | ||
| LI Wing Yin | Interest in a controlled corporation (Note 3) | 18,153,211 | 4.83 |
| Other interest (Note 2) | 130,804,000 | 34.84 | |
| 148,957,211 | 39.67 |
Notes:
- Tiger Crown is 100% owned by Rykadan Holdings Limited which in turn is 100% held by Mr. Chan. Rykadan Holdings Limited is therefore deemed to be interested in the 97,104,000 shares of the Company beneficially owned by Tiger Crown as well as the 51,853,211 Shares in which Tiger Crown is deemed to be interested as described in Note 2 below.
- Since Tiger Crown, Scenemay Holdings Limited, Mr. Chan, Li Chu Kwan and Li Wing Yin are regarded as a group of shareholders acting in concert to exercise their voting rights in the Company and are parties to an agreement under Section 317 of the SFO, pursuant to the provisions of the SFO, each of them is deemed to be interested in the Shares owned by the other parties to the agreement.
- As the entire issued share capital of Scenemay Holdings Limited is owned by Li Chu Kwan and Li Wing Yin in equal shares, each of Li Chu Kwan and Li Wing Yin is deemed to be interested in the 18,153,211 Shares beneficially owned by Scenemay Holdings Limited.
- All the Shares shown in the table above are ordinary shares.
– V-3 –
APPENDIX V
GENERAL INFORMATION
Save as disclosed above, so far as is known to any Director and chief executive of the Company, as at the Latest Practicable Date, no other persons or companies had any interest or short position in the Shares or underlying shares of the Company which would fall to be disclosed under Divisions 2 and 3 of Part XV of the SFO, or which were entered in the register required to be kept by the Company pursuant to Section 336 of the SFO.
As at the Latest Practicable Date, so far as was known to the Directors, Mr. Chan was also a director of Tiger Crown which has an interest or short position in the Shares and underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.
Save as disclosed above, as at the Latest Practicable Date, none of the Directors was a director or employee of a company which had an interest or short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.
3. SERVICE CONTRACTS
As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group which was not determinable by the Group within one year without payment of compensation other than statutory compensation.
4. DIRECTORS' INTERESTS IN COMPETING BUSINESSES
As at the Latest Practicable Date, so far as the Directors are aware, none of the Directors nor their respective close associates had any interest in any business which competed or is likely to compete with the business of the Group.
5. DIRECTORS' INTERESTS IN CONTRACTS AND ARRANGEMENTS/ASSETS
As at the Latest Practicable Date:
(i) none of the Directors had any direct or indirect interest in any assets which have been acquired or disposed of by or leased to, or are proposed to be acquired or disposed of by or leased to, any member of the Group since 31 March 2024, being the date up to which the latest published audited consolidated financial statements of the Group were made up; and
(ii) none of the Directors was materially interested in any contract or arrangement subsisting as at the Latest Practicable Date which was significant in relation to the business of the Group.
6. LITIGATION
As at the Latest Practicable Date, no member of the Group was involved in any litigation or claim of material importance and no litigation or claim of material importance was known to the Directors to be pending or threatened against any member of the Group.
- V-4 -
APPENDIX V
GENERAL INFORMATION
7. MATERIAL CONTRACTS
Save for the Provisional Agreements and the Formal Agreements, no members of the Group has entered into any contracts, not being contracts entered into in the ordinary course of business of the Group, within the two years immediately preceding the date of this circular and which are or may be material to the Group.
8. EXPERTS' CONSENTS AND QUALIFICATIONS
The following is the qualification of the experts who have given opinions, letters or advices which are contained in this circular:
| Name | Qualification |
|---|---|
| Deloitte Touche Tohmatsu | certified public accountants |
| Knight Frank Petty Limited | independent professional valuer |
As at the Latest Practicable Date, each of the above experts has given and has not withdrawn its written consent to the issue of this circular with the inclusion herein of its opinion, letter and/or report and references to its name in the form and context in which it appears.
As at the Latest Practicable Date, each of the above experts did not have any shareholding in any member of the Group nor did it have any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group, nor did it had any direct or indirect interest in any assets which have been, since 31 March 2024 (being the date to which the latest published audited consolidated financial statements of the Group were made up), acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group.
9. GENERAL
(a) The registered office of the Company is situated at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands.
(b) The Hong Kong head office and principal place of business of the Company is situated at Rooms 2701 & 2801, Rykadan Capital Tower, 135 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong.
(c) The Company's branch share registrar and transfer office in Hong Kong is Tricor Investor Services Limited situated at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong.
(d) The company secretary of the Company is Mr. Lui Man Kit, a member of the Hong Kong Institute of Certified Public Accountants and the Association of Chartered Certified Accountants.
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APPENDIX V
GENERAL INFORMATION
10. DOCUMENTS ON DISPLAY
Copies of the following documents will be published on the respective websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.rykadan.com) for display for a period of 14 days from the date of this circular:
(a) the Provisional Agreements;
(b) the Formal Agreements;
(c) the report on the unaudited pro forma financial information on the Remaining Group from Deloitte Touche Tohmatsu, the text of which is set out in Appendix III to this circular;
(d) the independent reporting accountant’s assurance report on the compilation of pro forma financial information from Deloitte Touche Tohmatsu, the text of which is set out in Appendix III to this circular;
(e) the valuation report of the Properties from Knight Frank Petty Limited, the text of which is set out in Appendix IV to this circular;
(f) the written consents referred to in the paragraph under the heading “Experts’ consents and qualifications” in this Appendix V to this circular; and
(g) this circular.
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NOTICE OF EGM
RYKADAN CAPITAL
RYKADAN CAPITAL LIMITED
宏基資本有限公司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 2288)
NOTICE OF EXTRAORDINARY GENERAL MEETING
NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the "EGM") of Rykadan Capital Limited 宏基資本有限公司 (the "Company") will be held at Room 1, 10/F, United Centre, 95 Queensway, Admiralty, Hong Kong on 17 April 2025, Thursday at 3:00 p.m., for the purpose of considering and, if thought fit, passing the following resolution as an ordinary resolution (with or without modifications). Unless the context requires otherwise, the terms used herein shall have the same meanings as those used in the circular to the shareholders of the Company (the "Shareholders") dated 27 March 2025 (the "Circular").
ORDINARY RESOLUTION
"THAT
(a) the formal agreement for sale and purchase dated 17 December 2024 (the "Formal Agreement A") entered into between Win Expo Enterprises Limited ("Vendor A") and German Pool (Hong Kong) Limited (the "Purchaser") in relation to the disposal of the $27^{\text{th}}$ Floor and car parking spaces nos. P11, P12, P13 and P14 on the $1^{\text{st}}$ Floor of Rykadan Capital Tower located at No. 135 Hoi Bun Road, Kowloon, Hong Kong by Vendor A to the Purchaser (the "Disposal A") (a copy of which has been produced to the EGM marked "A" and initialed by the chairman of the EGM for the purpose of identification) and the transactions contemplated thereunder be and are hereby approved, confirmed and ratified;
(b) the formal agreement for sale and purchase dated 17 December 2024 (the "Formal Agreement B") entered between Prime Talent Development Limited ("Vendor B") and the Purchaser in relation to the disposal of the $28^{\text{th}}$ Floor of and car parking spaces nos. P7, P8, P9 and P10 on the $1^{\text{st}}$ Floor of Rykadan Capital Tower located at No. 135 Hoi Bun Road, Kowloon, Hong Kong by Vendor B to the Purchaser (the "Disposal B") (a copy of which has been produced to the EGM marked "B" and initialed by the chairman of the EGM for the purpose of identification) and the transactions contemplated thereunder be and are hereby approved, confirmed and ratified; and
NOTICE OF EGM
(c) the directors of the Company be and are hereby authorised for and on behalf of the Company to approve and authorise the entering into, the execution, perfection, performance and delivery of all such other instruments, deeds, agreements and documents, and to do all such acts and things, as they may in their absolute discretion consider to be necessary, appropriate, desirable or expedient to implement and/or give effect to the Formal Agreements and all the transactions contemplated thereunder and all matters incidental or ancillary thereto or in connection therewith, and to agree to such variations, waivers and/or amendments to the Formal Agreements or such other instruments, deeds, agreements and documents as are, in the opinion of the directors of the Company, in the interests of the Company.”
By Order of the Board
Rykadan Capital Limited
宏基資本有限公司
Lui Man Kit
Company Secretary
Hong Kong, 27 March 2025
Notes:
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The resolution at the EGM will be taken by poll pursuant to the Rules Governing the Listing of Securities (the "Listing Rules") on The Stock Exchange of Hong Kong Limited (the "Stock Exchange") and the results of the poll will be published on the websites of the Stock Exchange and the Company in accordance with the Listing Rules.
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A member entitled to attend and vote at the EGM is entitled to appoint one or more (if he holds more than one share of the Company) proxies to attend and vote instead of him. If more than one proxy is appointed, the appointment shall specify the number and class of shares in respect of which each such proxy is so appointed. A proxy need not be a member of the Company.
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In order to be valid, the form of proxy together with the power of attorney or other authority (if any) under which it is signed, or a certified copy thereof, must be deposited at the Company's Hong Kong branch share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong not less than 48 hours before the time appointed for the holding of the EGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy shall not preclude a member of the Company from attending and voting in person at the EGM or any adjournment thereof (as the case may be). In such event, the said form of proxy shall be deemed to be revoked.
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For determining the qualification of members to attend and vote at the EGM, the register of members of the Company will be closed from 14 April 2025, Monday to 17 April 2025, Thursday, both days inclusive, during which period no transfer of shares will be registered. In order to be eligible as members to attend and vote at the EGM, all transfer documents, accompanied by the relevant share certificates, must be lodged with the Company's Hong Kong branch share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong for registration not later than 4:30 p.m. on 11 April 2025, Friday.
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If a black rainstorm warning signal or a tropical cyclone warning signal no. 8 or above is in force in Hong Kong 2 hours before the scheduled time of the EGM, the EGM will be adjourned. The Company will post an announcement on the Company's website and the Stock Exchange's website to notify Shareholders of the date, time and place of the adjourned meeting. The meeting will be held as scheduled when an amber or a red rainstorm warning signal is in force. Shareholders should decide on their own whether they would attend the meeting under bad weather conditions bearing in mind their own situations.
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There will be NO distribution of souvenir or service of refreshment at the EGM.
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EGM-2 -
NOTICE OF EGM
As at the date of this notice, the Board comprises Mr. CHAN William (Chairman and Chief Executive Officer) and Mr. LO Hoi Wah, Heywood (Chief Financial Officer) as executive Directors, Mr. NG Tak Kwan as a non-executive Director and Mr. TO King Yan, Adam, Mr. HO Kwok Wah, George and Ms. KHAN Sabrina as independent non-executive Directors.
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