PAC CENT CYBER<1186>-Announcement & Resumption of Trading
The Stock Exchange of Hong Kong Limited takes no responsibility for
the contents of this announcement, makes no representation as to its
accuracy or completeness and expressly disclaims any liability
whatsoever for any loss howsoever arising from or in reliance upon
the whole or any part of the contents of this announcement.
PACIFIC CENTURY CYBERWORKS LIMITED
(Incorporated in Hong Kong with limited liability)
ANNOUNCEMENT
PLACING OF EXISTING SHARES AND
SUBSCRIPTION OF NEW SHARES
AND
PROPOSED JOINT VENTURE WITH CMGI, INC.
On 25th January, 2000, Pacific Century Group Holdings Limited
(`PCG') entered into the Placing Agreement with BNP Peregrine, HSBC
Investment Bank Asia Limited, Credit Suisse First Boston (Hong Kong)
Limited and Jardine Fleming Securities Limited, pursuant to which,
the Placing Agents will acquire or procure purchasers to acquire, and
PCG will sell, 188,000,000 existing Shares at a price of HK$15.80 per
Share (the `Placing'). Under the Placing Agreement, BNP Peregrine has
been granted an option to acquire or procure purchasers to acquire
from PCG up to an additional 60,000,000 Shares in aggregate at the
Placing Price.
On the same day, PCG and Pacific Century CyberWorks Limited (the
`Company') entered into the Subscription Agreement, pursuant to
which, PCG has conditionally agreed to subscribe for 188,000,000 new
Shares (the `Subscription') at HK$15.80 per Share, which is
equivalent to the Placing Price (net of expenses). Should BNP
Peregrine exercise the Option, PCG will, in addition to the
188,000,000 new Shares, subscribe for such number of new Shares,
which is equal to the total number of Shares placed by BNP Peregrine
under the Option.
The net proceeds from the Placing and Subscription are estimated to
amount to about HK$2,906 million, or about HK$3,833 million if the
Option is fully exercised. The Company has earmarked approximately
HK$2,945 million for the establishment of and investment in a
proposed 50/50 joint venture (`CMGI Asia') with CMGI, Inc. (`CMGI')
and the implemention of its business plan. Any surplus arising from
the exercise of the Option with be used to meet the Company's working
capital needs.
CMGI Asia will be formed to create and operate internet-related
businesses in the Asia Pacific region. It will be headquartered in
Hong Kong where it will establish Asia-Pacific operations for the
CMGI majority-owned operating companies.
THE PLACING
Date of the agreement (the `Placing Agreement')
25th January, 2000
Parties
Vendor: PCG
Lead manager and placing BNP Prime Peregrine
agent: Securities Limited (`BNP
Peregrine')
Placing agents: HSBC Investment Bank Asia
Limited, Credit Suisse First
Boston (Hong Kong) Limited
and Jardine Fleming
Securities Limited (together
with BNP Peregrine, the
`Placing
Agents')
Number of Shares to be placed
If Option is not exercised:
188,000,000 existing shares of HK$0.05 each (`Shares'), representing
about 2.1% of the existing issued share capital of the Company. The
Shares to be placed also represent about 2.0% of the issued share
capital of the Company as enlarged by the Subscription of 188,000,000
Shares.
If Option is fully exercised:
248,000,000 Shares, representing about 2.7% of the existing issued
share capital of the Company. The Shares to be placed also represent
about 2.7% of the issued share capital of the Company as enlarged by
the Subscription of 248,000,000 Shares.
The Option
BNP Peregrine had been granted an option (the `Option') to acquire
or procure purchasers to acquire from PCG up to 60,000,000 additional
Shares exercisable on or before 3:55 p.m. on 26th January, 2000. Such
additional Shares represent about 0.7% of the existing issued share
capital of the Company.
A further announcement will be made by the Company if and when BNP
Peregrine has exercised the Option.
The Placing Price
HK$15.80 per Share (the `Placing Price'), which represents a
discount of approximately 5.1% to the last traded price of HK$16.65
per Share as quoted on The Stock Exchange of Hong Kong Limited (the
`Stock Exchange') at 12:30 p.m. on 25th January, 2000 (being the last
day of trading of the Shares prior to suspension). Such price also
represents a discount of approximately 5.2% to the 10-day average
closing price of HK$16.66 on and immediately preceding 25th January,
2000.
Shares to be issued under the Placing and the Option
The Shares to be placed under the Placing and pursuant to the
exercise of the Option (if applicable) will be sold free from all
liens, charges, encumbrances, claims, options or any third party
rights and together with all rights attaching thereto as at the date
of this announcement, including the right to all dividends or other
distributions which may be declared, paid or made after the date of
this announcement.
Independence of placees and the Placing Agents
The placees are independent institutional, professional and other
investors and are third parties independent of the directors, chief
executive or substantial shareholders of the Company, any of its
subsidiaries or their respective associates (as defined in the
Listing Rules).
The Placing Agents are third parties independent of the directors,
chief executive or substantial shareholders of the Company, any of
its subsidiaries or their respective associates (as defined in the
Listing Rules).
Conditions and completion of the Placing
The Placing is unconditional but subject to the rights of
termination referred to below.
Any two of the four Placing Agents who have agreed to underwrite an
aggregate of at least 94,000,000 Shares (the `Authorised Agents')
have the right jointly to terminate the arrangements set out in the
Placing Agreement by notice in writing to PCG if any time prior to
9:30 a.m. on 28th January, 2000 (or such other date and time as may
be agreed between PCG and the Authorised Agents):
(i)
there is a breach of any of the warranties, representations or
undertakings contained in the Placing Agreement and such breach is
considered by the Authorised Agents, in their reasonable opinion, to
be material in the context of the Placing; and
(ii)
the following events or circumstances having developed, occurred or
come into force, including, inter alia:
(a)
any material change (whether or not forming part of a series of
changes) in market conditions which in the Authorised Agents'
reasonable opinion prejudicially affects the Placing or makes it
inadvisable or inexpedient for the Placing to proceed; or
(b)
any change in national, international, financial, exchange control,
industrial, legal, political, economic or market conditions in Hong
Kong, the People's Republic of China, or elsewhere which in the
Authorised Agents' reasonable opinion is or could reasonably be
expected to be materially adverse to the business of the Company and
its subsidiaries (the `Group') taken as a whole or any member of the
Group considered by the Authorised Agents to be material or is or may
be materially adverse in the context of the Placing.
THE SUBSCRIPTION
Date of the agreement (the `Subscription Agreement')
25th January, 2000
Parties
Issuer: The Company
Subscriber: PCG
Number of new Shares to be subscribed for
188,000,000 new Shares, representing about 2.1% of the existing
issued share capital of the Company and about 2.0% of the issued
share capital of the Company as enlarged by the issue of new Shares
pursuant to the Subscription.
Should BNP Peregrine exercise the Option, PCG will, in addition to
the 188,000,000 new Shares, subscribe for such number of new Shares,
which is equal to the total number of Shares placed by BNP Peregrine
under the Option.
The new Shares will be issued pursuant to the general mandate
granted to the directors of the Company at the extraordinary general
meeting of the Company held on 22nd November, 1999.
The Subscription Price
HK$15.80 per Share (the `Subscription Price'), which is equivalent
to the Placing Price. Pursuant to the Subscription Agreement, the
Company shall bear the costs and expenses of this transaction so that
the proceeds received by the Company will be net of such costs and
expenses.
Ranking of new Shares
The new Shares, when fully paid, will rank pari passu in all
respects with the then existing Shares.
Conditions and completion of the Subscription
The Subscription is conditional upon:
-completion of the Placing pursuant to the terms of the Placing
Agreement; and
- the listing of, and permission to deal in, all the new Shares to be
issued pursuant to the Subscription being granted by the Listing
Committee of the Stock Exchange (and such permission and listing not
subsequently being revoked prior to the delivery of definitive Share
certificate(s) representing such new Shares).
Completion of the Subscription shall take place at 3:00 p.m. on the
second business day after all conditions stated above have been
fulfilled, and in any event not later than 14 days after the date of
the Placing Agreement signed on 25th January, 2000 (which is 8th
February, 2000), or such other date as the Company and PCG may agree
in writing.
If the Subscription is not completed within the 14-day period (which
ends on 8th February, 2000), shareholders' approval from the
independent shareholders of the Company will be required.
Use of proceeds
The net proceeds from the Placing and Subscription are estimated to
amount to about HK$2,906 million, or about HK$3,833 million if the
Option is exercised in full. The Company has earmarked approximately
HK$2,945 million for the establishment of and investment in CMGI Asia
and the implementation of its business plan. Any surplus arising from
the exercise of the Option will be used to meet the Company's working
capital needs.
SHAREHOLDING STRUCTURE
Set out below is the shareholding structure of the Company
immediately before and after completion of the Placing and the
Subscription, assuming that the Option is not exercised:
Shareholder Before Immediately Immediately
completion after after
of the completion completion
Placing of the of the
Placing Placing
and the
Subscription
Shares % Shares % Shares %
(mln) (mln) (mln)
Pacific 4,654.8 51.3 4,654.8 51.3 4,654.8 50.3
Century
Regional
Developments
Limited
(`PCRD')
PCG 435.5 4.8 247.5 2.7 435.5 4.7
Pacific 752.3 8.3 752.3 8.3 752.3 8.1
Century
Diversified
Limited
(`PCD')
Intel Pacific, 77.8 0.9 77.8 0.9 77.8 0.8
Inc.
(`Intel')
CMGI 448.3 4.9 448.3 4.9 448.3 4.8
Public 2,698.3 29.8 2,886.3 31.8 2,886.3 31.2
------- ---- ------- ---- ------- ----
TOTAL 9,067.0 100 9,067.0 100 9,255.0 100
======= === ======= ==== ======= ====
Set out below is the shareholding structure of the Company
immediately before and after completion of the Placing and the
Subscription, assuming that the Option is exercised in full:
Shareholder Before Immediately Immediately
completion after after
of the completion completion
Placing of the of the
Placing Placing
and the
Subscription
Shares % Shares % Shares %
PCRD 4,654.8 51.3 4,654.8 51.3 4,654.8 50.0
PCG 435.5 4.8 187.5 2.1 435.5 4.7
PCD 752.3 8.3 752.3 8.3 752.3 8.1
Intel 77.8 0.9 77.8 0.9 77.8 0.8
CMGI 448.3 4.9 448.3 4.9 448.3 4.8
Public 2,698.3 29.8 2,946.3 32.5 2,946.3 31.6
------------------------------------------------------
TOTAL 9,067.0 100 9,067.0 100 9,315.0 100
======================================================
Information on CMGI
With more than 60 companies, CMGI, a company listed on the Nasdaq,
represents the largest, most diverse network of internet companies in
the world. This network includes both CMGI operating companies and a
growing number of synergistic investments through its venture capital
affiliate @Ventures, CMGI leverages the technologies, content, and market
reach of its extended family of companies to foster rapid growth and
industry leadership across its network, and the larger internet
economy.
The notable companies that CMGI majority-owns and operates include
Engage Technologies, NaviSite, 1ClickBrands, 1stUp.com, Activate.net,
Activerse, AdForce, Adsmart, AltaVista, CMGI Solutions, Equilibrium,
Flycast, iCAST, Magnitude Network, MyWay.com, NaviNet, SalesLink,
Tribal Voice and ZineZone, CMGI's @Ventures affiliates have ownership
interests in, among others, Lycos, Inc., Critical Path, Silknet,
Chemdex, MotherNature.com, Asimba.com, AuctionWatch.com, Aureate Media,
blaxxun, BizBuyer.com, Boatscape.com, buyersedge.com, CarParts.com,
CraftShop.com, eCircles.com, eGroups.com, EXP.com, FindLaw,
FoodBuy.com, Furniture.com, Half.com, HotLinks,
INPHO/HomePriceCheck.com, Intelligent/Digital, KOZ.com, Mondera.com,
MyFamily.com, NextMonet.com, NextPlanetOver.com, Oncology.com,
OneCore.com, PlanetOutdoors.com, Productopia, Raging Bull, SnapFish.com,
Speech Machines, ThingWorld.com, Vicinity, Virtual Ink, Visto, Vstore
and WebCT.
REASONS FOR and benefits of THE PLACING AND THE SUBSCRIPTION
As stated under the section `Use of proceeds' above, the net
proceeds will be used mainly for the establishment of and investment
in CMGI Asia and the implementation of its business plan. CMGI Asia,
a joint venture to be owned as to 50% and 50% by the Company and CMGI
respectively, will be formed to create and operate internet-related
businesses in the Asia Pacific region. CMGI Asia will be
headquartered in Hong Kong where it will establish Asia-Pacific
operations for the CMGI majority-owned operating companies. It is
intended that CMGI Asia will serve as a holding and management
company and will enter into separate joint ventures with each of the
individual CMGI operating companies. In each case, CMGI Asia will be
granted at least 60% of the shares in such CMGI operating companies.
The remaining 40% will be held by the individual CMGI operating
company. However, no detailed terms regarding the joint ventures with
the individual CMGI operating companies have been determined at this
stage. The first four companies to be brought to Asia under the joint
venture include AltaVista (http://www.altavista.com), the premier
media and commerce network; Engage Technologies
(http://www.engage.com), a leading provider of profile driven
internet marketing solutions; iCAST (http://www.icast.com) a
multi-media, online entertainment company; and 1ClickCharge
(http://www/1clickcharge.com), the pioneering single-click internet
payment service. Future operating companies joining the CMGI network,
either through incubation or acquisition, may be able to expand their
operations in Asia under the above-mentioned joint venture
arrangement. However, the detailed business development plans in
relation to the investment in such CMGI operating companies are being
developed.
The directors of the Company believe that the Company will benefit
from the proposed joint venture with CMGI and expect that significant
synergy will be generated from such proposed joint venture.
GENERAL
An application will be made to the Listing Committee of the Stock
Exchange for the listing of, and permission to deal in, the new
Shares to be issued pursuant to the Subscription and the Option.
At the request of the Company, trading in the Shares on the Stock
Exchange was suspended with effect from 2:30 p.m. on 25th January,
2000, pending the issue of this announcement. An application has been
made by the Company to the Stock Exchange for resumption of trading
in the Shares with effect from 10.00 a.m. on 26th January, 2000.
By Order of the Board
Chu Mee Lai, Helen
Company Secretary
Hong Kong, 25th January, 2000
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