HUTCHISON<0013>&HARBOUR RING<0715>-Joint Announcement & Harbour Ring 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.
Internet Capital Group, Inc.
(Incorporated under the laws of the State of Delaware of the
US with limited liability)
Hutchison Whampoa Limited
(Incorporated in Hong Kong with limited liability)
Harbour Ring International Holdings Limited
(Incorporated in Bermuda with limited liability)
Joint announcement
Agreements for ICG, HWL Sub and LKS Foundation
to subscribe for the New Shares and the Warrants
and
the Put Option
and
application for the granting of the Whitewash Waiver and the
Special Deal Consent
and
change of name of the Company
to ICG AsiaWorks Limited
The Company entered into the Subscription Agreements with ICG,
HWL Sub and LKS Foundation respectively in relation to the
subscriptions of 3,018,400,000 New Shares by ICG, 454,978,000
New Shares by HWL Sub and 274,400,000 New Shares by LKS
Foundation respectively at an issue price of HK$0.30 per Share
on 9th March, 2000. Completion is conditional upon a number
of conditions as set out below under the section headed
``Conditions of the Subscription Agreements''.
At present, ICG and its Concert Parties own 1,025,752,000
Shares other than pursuant to the Subscription Agreements.
Upon Completion, ICG and its Concert Parties will be interested
in 4,499,130,000 Shares, representing about 82.1% of the
issued share capital of the Company as enlarged by the New
Shares to be issued under the Subscriptions.
Under Rule 26 of the Takeover Code, upon Completion, ICG and
its Concert Parties are obliged to make an unconditional
general offer for all the issued Shares not already owned or
agreed to be acquired by ICG or its Concert Parties. An
application will be made by ICG to the Executive for the
Whitewash Waiver which, if granted, would normally be subject
to the approval of the Independent Shareholders on a vote taken
by a way of a poll. The Executive may or may not grant the
Whitewash Waiver. Completion is conditional upon, amongst
other things, the granting of the Whitewash Waiver by the
Executive. Under the Subscription Agreements, this condition
can be waived by ICG. If the Whitewash Waiver is not granted,
ICG may waive such condition and consider making an
unconditional general offer for all the Shares other than those
already owned or agreed to be acquired by ICG or its Concert
Parties. If the condition of granting the Whitewash Waiver by
the Executive is not fulfilled or waived by ICG, the
Subscription Agreements will lapse. ICG has undertaken to
Goldman Sachs (Asia) L.L.C. that it will not waive the
Whitewash Waiver condition and extend the general offer for
all the Shares other than those already owned or agreed to be
acquired by ICG or its Concert Parties unless Goldman Sachs
(Asia) L.L.C. is satisfied that ICG has sufficient financial
resources to satisfy full acceptance of such general offer.
Shamrock has agreed to grant the Put Option to the Company to
require Shamrock to acquire all (but not part only) of the Toy
and Property Operations at a consideration of HK$225,413,220
exercisable during a period of two years subject to provisions
for extensions thereof. The granting of the Put Option will
constitute a special deal under Rule 25 of the Takeover Code
and hence requires consent from the Executive. An application
will be made to the Executive for the Special Deal Consent.
It is proposed that the name of the Company will be changed
to ICG AsiaWorks Limited.
Trading in the securities of the Company on the Stock Exchange
was suspended at the request of the Company with effect from
2.30 p.m. on 1st March, 2000 pending release of this
announcement. Application has been made by the Company for the
resumption of trading in the securities of the Company with
effect from 10.00 a.m. on 10th March, 2000.
THE SUBSCRIPTION AGREEMENTS
Date
9th March, 2000
Parties
In respect of the ICG Subscription Agreement
The Company
ICG
International Toys
Reading
HWL (together with the Company, International Toys and Reading
as warrantors)
In respect of the Hutchison Subscription Agreement
The Company
HWL Sub
International Toys and Reading (together with the Company as
warrantors)
In respect of the LKS Foundation Subscription Agreement
The Company
LKS Foundation
International Toys and Reading (together with the Company as
warrantors)
ICG is independent of the directors, chief executive and
substantial shareholders of the Company, any of its
subsidiaries or their respective Associates but as referred
to below, is acting in concert with HWL Sub. HWL Sub is a
substantial shareholder of the Company. LKS Foundation is
not an Associate of the directors, chief executive and
substantial shareholders of the Company or any of its
subsidiaries.
Shares to be issued
An aggregate of 3,747,778,000 New Shares, representing
approximately 68.15% of the issued share capital of the Company
as enlarged by the New Shares to be issued under the
Subscriptions. Under the Subscriptions, 3,018,400,000 New
Shares are to be subscribed by ICG or its nominees, 454,978,000
New Shares are to be subscribed by HWL Sub or its nominees and
274,400,000 New Shares are to be subscribed by LKS Foundation.
The New Shares will rank pari passu in all respects with all
existing Shares, including the rights to receive all future
dividends and distributions declared, made or paid by the
Company on or after the date of the Subscription Agreements.
Issue Price
The issue price per Share of HK$0.30 represents a discount of
about 75.6% to the closing price of HK$1.23 per Share as quoted
on the Stock Exchange at the end of the morning session on 1st
March, 2000, the day on which trading of the Shares was
suspended at 2.30 p.m. and a discount of about 57.7% to the
average closing price of HK$0.71 per Share over the 10 trading
days up to and including 1st March, 2000. Such issue price per
Share also represents a discount of about 65.5% to the audited
consolidated net tangible asset value per Share of about
HK$0.87 as at 31st December, 1998.
The terms of the Subscription Agreements were negotiated on
an arm's length basis. In negotiating the issue price for the
New Shares, the directors of the Company and the Subscribers
have taken into account, amongst others, the following
factors:
* The significant increment in the prices and trading
volume of the Shares on 1st March, 2000. The closing price per
Share increased from $0.70 on 29th February, 2000 to HK$1.23
on 1st March, 2000, representing an increase of about 76%.
* The respective average closing prices per Share for the
20, 60 and 120 days period up to and including 29th February,
2000 were about HK$0.67, HK$0.45 and HK$0.39 respectively.
* The issue price of HK$0.30 represents a price/earning
multiple of about 12.5 times over the earning per Share of about
HK$0.024 for the year ended 31st December, 1998.
* The audited consolidated net tangible asset value per
Share of HK$0.87 as at 31st December, 1998.
* The properties of the Company held for investment, under
development, for own use and for resale in the People's
Republic of China, representing about 40% of the total assets
of the Group. In this respect, the directors of the Company
note that shares in most property companies with portfolio
principally in the People's Republic of China and listed on
the Stock Exchange are presently being traded at substantial
discounts to their respective audited consolidated net asset
values per share.
Warrants to be issued
It is a term of the Subscription Agreements that at Completion
803,000,000 Warrants will be issued to ICG, 219,000,000
Warrants will be issued to HWL Sub, and 73,000,000 Warrants
will be issued to LKS Foundation. The consideration payable
by each of ICG, HWL and LKS Foundation for the Warrants is
HK$1.00. The holders of the Warrants will be entitled to
subscribe in cash for new Shares during a period of three years
after the date of issue at an initial subscription price of
HK$0.39 per Share. Each of ICG and HWL Sub has agreed not to
transfer or otherwise dispose of any new Shares issued pursuant
to any exercise of the Warrants during the period of one year
immediately after Completion.
The Warrants will not be listed or dealt in on any stock
exchange.
Conditions of the Subscription Agreements
Completion of the Subscription Agreements is conditional upon
the following conditions being fulfilled (or waived by the
relevant Subscribers):
(a) the passing of all necessary resolutions, on a poll
where necessary, by the shareholders (being, where required
by the Stock Exchange or SFC, the Independent Shareholders)
of the Company at a special general meeting approving:
(i) the transactions contemplated by the Subscription
Agreements;
(ii) increasing the authorised share capital of the
Company, authorising the allotment and issue of the New Shares
and the Warrants to the Subscribers (or, in the case of ICG,
to ICG's nominees) upon Completion and the allotment and issue
of the Shares to be issued upon the exercise of the Warrants;
(iii) the granting of a waiver to ICG or its nominees and
its Concert Parties in respect of their obligations to extend
a general offer to the shareholders of the Company as a result
of the issue of the New Shares and the Warrants in accordance
with Note 1 of the Notes on dispensations from Rule 26 of the
Takeover Code;
(iv) the amendment to the bye-laws of the Company for the
issue of the Warrants (if required);
(v) the transactions contemplated under the Option Deed; and
(vi) the change of the name of the Company to ``ICG
AsiaWorks Limited";
(b) the granting by the Listing Committee of the Stock
Exchange of a listing of, and permission to deal in, the New
Shares to be issued by the Company upon Completion and the new
Shares to be issued upon the exercise of the Warrants;
(c) the approval from the Bermuda Monetary Authority of the
issue of the New Shares and the new Shares to be issued upon
the exercise of the Warrants (if required under Bermuda law);
(d) the granting by SFC of the Whitewash Waiver in relation
to the obligation to make a mandatory general offer of Shares
not already held or agreed to be allotted to ICG or its Concert
Parties by the Subscribers (or their Concert Parties), as a
result of the issue of the New Shares in accordance with Note
1 of the Notes on dispensations from Rule 26 of the Takeover
Code;
(e) the granting by the Executive of the Special Deal
Consent;
(f) the warranties under the Subscription Agreements
remaining true and accurate and not misleading in any material
respect as given at the date hereof and at Completion;
(g) the entry into of the Management Services Agreement;
(h) the becoming unconditional (other than in relation to
the conditions (in both cases) requiring the Subscription
Agreements to become unconditional or the Completion) of each
of the following agreements and deed:
(i) the ICG Subscription Agreement;
(ii) the Hutchison Subscription Agreement;
(iii) the LKS Foundation Subscription Agreement; and
(iv) the Option Deed;
(i) the completion of due diligence on the Company by the
relevant Subscribers without identification of any matters
which would have a material adverse effect on the financial
standing of the Company such that:
(i) the net asset value of the Company as at the date of
the Subscription Agreements, as determined by the auditor of
the Company, shall be less than HK$300 million;
(ii) the Company shall hold less than HK$300 million of cash
net of short and long term debt or liability at Completion;
or
(iii) the Company shall have any material indebtedness or
liabilities, contingent or otherwise as at the date of
Completion, of over HK$10 million which are not fully provided
for in the audited balance sheet of the Company as at 31st
December, 1998;
(j) the continued listing and trading of the Shares on the
Stock Exchange, save for any temporary suspension not
exceeding 10 consecutive trading days (or such longer period
as the Subscribers may reasonably accept in writing) and any
temporary suspension in connection with clearance of the
announcement in relation to the Subscription Agreements and
no indication being received on or before Completion from SFC
or the Stock Exchange to the effect that the listing of the
Shares on the Stock Exchange will or may be withdrawn or
objected to (or conditions will or may be attached thereto
except those the Subscribers shall reasonably accept) as a
result of Completion or in connection with the terms of the
Subscription Agreements; and
(k) if so required, the consents, licences, authorisations,
orders, grants, confirmations, permissions, registrations,
filings and other approvals necessary or desirable in
connection with the implementation of the Subscription
Agreements required by the parties having been obtained from
appropriate governments, governmental, supranational or trade
agencies, courts, other regulatory bodies, banks, financial
institutions or other third parties on terms satisfactory to
the parties and such consents, licences, authorisations,
orders, grants, confirmations, permissions, registrations and
other approvals remaining in full force and effect.
Each Subscriber alone shall be entitled in its absolute
discretion, by written notice to the Company, to waive any or
all of the conditions precedent set out above in (a)(iii),
(a)(iv), (a)(vi), (a)(vii), (d), (i), (j) and (k) so far as
it concerns the relevant Subscriber, either in whole or in part.
The Company alone shall be entitled in its absolute discretion,
by written notice to the Subscribers, to waive the conditions
precedent set out above in (k) so far as it concerns the
Company.
ICG has undertaken to Goldman Sachs (Asia) L.L.C. that it will
not waive the Whitewash Waiver condition and extend the general
offer for all the Shares other than those already owned or
agreed to be acquired by ICG or its Concert Parties unless
Goldman Sachs (Asia) L.L.C. is satisfied that ICG has
sufficient financial resources to satisfy full acceptance of
the general offer.
Completion
The Completion will take place on the third business day after
all conditions of the Subscription Agreements have been
satisfied (or waived or such other date as may be agreed between
the parties). It is expected that the date of Completion will
be in May 2000. In the event that the conditions (a)(iii),
(a)(iv), (a)(vi), (a)(vii), (f), (i), (j) and (k) (in so far
as it relates to it) of Subscription Agreements are not
fulfilled or waived by the relevant Subscriber by 31st July,
2000, it will lapse. In the event that the condition (j) is
not fulfilled by the Company by 31st July, 2000, the
Subscription Agreements will lapse.
Use of proceeds
The gross proceeds from the Subscriptions are estimated to
amount to about HK$1,124 million. It is intended that the net
proceeds will be used principally to expand the business of
the Group, in particular, to be an incubator, acquirer and
builder of market maker, software and service companies that
enable business-to-business e-commerce. At present, there is
no specific project under consideration.
THE OPTION DEED
Date
9th March, 2000
Parties
The Company
Shamrock
HWL (as guarantor)
Shamrock is a company incorporated in the British Virgin
Islands and is owned as to 50% by Morgania Wave Limited, a
company incorporated in the British Virgin Islands and an
indirect wholly-owned subsidiary of HWL, as to 25% by Reading
and as to 25% by International Toys. As at the date of this
announcement, International Toys and Reading hold an aggregate
of 649,600,000 Shares, representing approximately 37.5% of the
existing issued share capital of the Company. Dr. Luk Chung
Lam and Messrs. Ko Yuet Ming, Tam Yue Man and Luk Tei, Lewis,
all are existing executive directors of the Company who
beneficially own approximately 57%, 17.4%, 3.9% and 6.3%,
respectively, of the issued share capital of International
Toys. Acefield beneficially owns 92.9% of the issued share
capital of Reading. Dr. Luk Chung Lam and Messrs. Ko Yuet Man,
Tam Yue Man and Luk Tei, Lewis beneficially own approximately
63.9%, 19.5%, 4.4% and 3.0%, respectively, of the issued share
capital of Acefield.
The Put Option
Subject to the fulfilment of condition (a) set out under the
section headed ``Conditions of the Option Deed'' below,
Shamrock has agreed to grant the Company the Put Option to
require Shamrock to acquire all (but not part only) of the Toy
and Property Operations at a consideration of HK$225,413,220
exercisable during a period of two years after Completion
subject to provisions for extensions thereof as stated therein.
HWL has unconditionally and irrevocably gauranteed all of the
obligations, in particular, payment of the consideration of
Shamrock under the Put Option. The Company has agreed to notify
Shamrock as soon as practicable of the detailed terms of any
proposal for the sale of the Toy and Property Operations by
the Company to any third party such that Shamrock shall be given
a reasonable opportunity to submit an offer for the same if
it so wishes.
On the basis of the existing composition of the assets of the
Group, the assets of the Group would comprise principally of
cash assuming that the Put Option were exercised as at the date
hereof. The Stock Exchange has indicated its concern on the
suitability of listing of cash companies as described under
the Listing Rules. The Stock Exchange will closely monitor the
situation of the Company upon the exercise of the Put Option.
Conditions of the Option Deed
The obligation to grant the Put Option is conditional upon
fulfilment of the following conditions on or before 31st July,
2000 or such other date as the parties may agree in writing:
(a) the Subscription Agreements becoming unconditional
(save for any matter which is conditional or contingent upon
the Option Deed becoming unconditional) and the Subscriptions
occurring in accordance with the respective terms of the
Subscription Agreements; and
(b) the granting of the Put Option and the consummation of
the transactions contemplated under the Option Deed being
approved by the Independent Shareholders at a special general
meeting of the Company taken on a poll and an independent
financial adviser to the Company opining that the terms thereof
are fair and reasonable and the Executive giving his consent
under Note 4 to Rule 25 of the Takeover Code.
Completion is conditional upon the Company not having received
any objection from the Stock Exchange or the SFC to the effect
that the listing of the Shares on the Stock Exchange may or
is likely to be withdrawn as a result of the performance by
the Company and Shamrock of their respective obligations under
the Option Deed within 14 days of the Company giving its written
notice to the Stock Exchange and the SFC.
TAKEOVER CODE IMPLICATION FOR ICG
HWL, Reading, International Toys, Acefield, Dr. Luk Chung Lam,
Messrs. Ko Yuet Man, Tam Yue Man and Luk Tei, Lewis have been
deemed to be acting in concert with respect to control of the
Company. As a result of entering into of the Subscription
Agreements, HWL and ICG become Concert Parties with respect
to control of the Company. As such, HWL, ICG, Reading,
International Toys, Acefiled, Dr. Luk Chung Lam, Messrs. Ko
Yuet Man and Luk Tei, Lewis are deemed to be a concert group
with respect to control of the Company in contemplation of this
transaction.
At present, ICG and its Concert Parties own 1,025,752,000
Shares other than pursuant to the Subscription Agreements.
Upon Completion, ICG, and its Concert Parties will be
interested in 4,499,130,000 Shares, representing about 82.1%
of the issued share capital of the Company as enlarged by the
New Shares to be issued under the Subscriptions. The existing
shareholding structure and the shareholding structure on
Completion are set out in the section headed ``Shareholding
structure'' below. Neither ICG nor any of its Concert Parties
had dealt in the Shares during the six months period prior to
the date of this announcement.
Under Rule 26 of the Takeover Code, upon Completion, ICG is
obliged to make an unconditional general offer for all the
issued Shares not already owned or agreed to be acquired by
ICG or its Concert Parties.
An application will be made by ICG to the Executive for the
Whitewash Waiver, which, if granted, would normally be subject
to the approval of the shareholders of the Company who are not
involved or interested in the Subscriptions on a vote taken
by a way of a poll. The Executive may or may not grant the
Whitewash Waiver. Completion is conditional upon, inter alia,
the granting of the Whitewash Waiver by the Executive. Under
the Subscription Agreements, this condition can be waived by
ICG. If the Whitewash Waiver is not obtained, ICG may waive
this condition and consider making an unconditional general
offer for all the Shares other than those already owned by the
ICG or its Concert Parties failing which the Subscription
Agreements will lapse.
SPECIAL DEAL CONSENT
The granting of the Put Option will constitute a special deal
under Rule 25 of the Takeover Code and hence requires consent
from the Executive. An application will be made to the
Executive for the Special Deal Consent which, if given, will
be subject to the independent financial adviser to the Company
stating that in its opinion the terms of the Put Option are
fair and reasonable and the granting of the Put Option being
approved by the Independent Shareholders at a special general
meeting of the Company on a vote taken by way of a poll.
SHAREHOLDING STRUCTURE
Set out below is a table showing the existing shareholding
structure and the structure on completion of the Subscriptions
(but not taking into account the Shares issued pursuant to any
exercise of the Warrants).
Assuming outstanding Upon completion
employees share options of the proposal
of the Company are exercised
Existing in full
Number Percentage Number Percentage Number Percentage
of of of
Shares Shares Shares
ICG --- 0.0% --- 0.0% 3,018,400,000 54.9%
Hutchison
Subsidiary 368,222,000 21.3% 368,222,000 21.0% 823,200,000 15.0%
LKS
Foundation --- 0.0% --- 0.0% 274,400,000 5.0%
368,222,000 21.3% 368,222,000 21.0% 4,116,000,000 74.9%
Dr. Luk Chung Lam
and his Associates
651,400,000 37.6% 653,900,000 37.3% 653,900,000 11.9%
Other directors
of the Company*
7,798,000 0.4% 15,298,000 0.9% 15,298,000 0.3%
A wholly owned subsidiary of Playmates Toys Holdings Limited
238,218,000 13.8% 238,218,000 13.6% 238,218,000 4.3%
Other shareholders
465,239,402 26.9% 475,739,402 27.2% 475,739,402 8.6%
1,730,877,402 100.0% 1,751,377,402 100.0% 5,499,155,402 100.0%
* Assume all existing directors of the Company will resign upon
the Completion
INFORMATION ON THE GROUP
Business
The Company is incorporated in Bermuda with limited liability
and its Shares are listed on the Stock Exchange. The Company
is an investment holding company and its subsidiaries are
principally engaged in the manufacture and trading of toys,
and the sale and investment of properties.
Financial information
The following table sets out a summary of the audited
consolidated results of the Company for the three years ended
31st December, 1998
For the year ended 31st December,
1996 1997 1998
HK$'million HK$'million HK$'million
Turnover 1,744 1,601 1,517
Profit attributable
to shareholders 101 33 42
As at 31st December, 1998, the audited consolidated net asset
value of the Company was HK$1,513 million.
INFORMATION ON ICG
Business
ICG is incorporated under the laws of the State of Delaware
of the US with limited liability and its shares are listed on
NASDAQ. ICG is an internet company actively engaged in
business-to-business e-commerce through a network of partner
companies. It provides operational assistance, capital
support, industry expertise and a strategic network of
business relationship intended to maximise the long-term
potential of more than 55 business-to-business e-commerce
partner companies.
Financial information
The following table sets out a summary of the audited
consolidated results of ICG for the three years ended 31st
December, 1999
For the year ended 31st December,
1997 1998 1999
US$'million US$'million US$'million
Net sales 0.79 3.13 16.54
Net income/(loss) (6.58) 13.90 (29.78)
As at 31st December, 1998, the audited net asset of ICG was
about US$87.1 million (about HK$677.48 million). The market
capitalisation of ICG was about US$37 billion (about HK$286
billion) as at 7th March, 2000.
INTENTION ON THE GROUP
Business
It is intended that after Completion the Group will continue
the existing business of manufacturing and trading of toys,
and the sale and investment of properties. The directors of
ICG will conduct a review of the financial position and
operations of the Group with a view to determining the strategy
towards such business activities.
Upon Completion, the existing and future directors of the
Company will aim to position the Group strategically to benefit
from the growth of the Internet sector in Asia. The Company
will acquire and build leading Asian-based
business-to-business market makers infrastructure companies,
such as digital exchanges, consulting firms, software
companies, and outsourced service providers. In addition, the
Company will operate several business incubation centres in
Hong Kong and the Greater China region that will serve as a
platform to bring ICG's market makers and infrastructure
providers to Asia and start new Asian-based companies. The
Company intends to accelerate the development of these
companies by providing strategy, technology and executive
recruiting, in addition to the operational expertise of ICG's
global executive team and extensive network of partner
companies.
There is no plan for ICG to inject any of its existing assets
or businesses into the Group. The directors of ICG and of HWL
believe that the two groups form a strong business alliance
in exploring and developing business opportunities in Asia.
The directors of HWL presently intend to continue to hold the
Shares as a strategic investment.
Directors of the Company
It is the intention of ICG to nominate Mr. Kenneth A. Fox and
Mr. Victor S. Hwang to the board of directors of the Company.
It is also the intention of ICG to nominate an additional three
directors to the board of directors of the Company. It is
intended that other than Mr. Canning Fok and Mr. Dominic Lai,
both of whom are nominated by HWL, all the existing directors
of the Company will resign upon the completion of the
Subscription Agreements. As such, the board of directors of
the Company would comprise nine directors, including two
independent non-executive directors.
Particulars of Mr. Kenneth A. Fox, Mr. Victor S. Hwang are as
follows:
Mr. Kenneth A. Fox is co-founder of ICG. He has served as one
of ICG's Managing Directors since ICG's inception in March 1996
and as one of its directors since February 1999. Prior to
co-founding ICG, Mr. Fox served as Director of West Coast
Operations for Safeguard Scientifics, Inc. and Technology
Leaders II, L.P., a verture capital partnership, from 1994 to
1996. In this capacity, Mr. Fox led the development of and
managed the West Coast Operations for these companies. Mr. Fox
serves as a director of AUTOVIA Corporation, Bidcom, Inc.,
Commerx, Inc., Deja.com, Inc., Entegrity Solutions
Corporation, ONVIA.com, Inc. and Vivant! Corporation.
Mr. Victor S. Hwang has served as one of ICG's Managing
Directors of Acquisitions since March 1999. Prior to joining
ICG, Mr. Hwang served from January 1999 to March 1999 as a
General Partner of Softbank Holdings, responsible for
developing an investment fund targeting late-stage private
internet companies. From August 1995 to January 1999, Mr. Hwang
also served as an investment banker at Goldman Sachs & Co.,
where he was involved in numerous financing and merger
transactions for a broad range of internet, software,
semiconductor, communications, and hardware companies.
The directors of ICG intend that there will be no material
changes to the existing management and employees of the Company
and its subsidiaries by reason only of the Subscriptions.
CHANGE OF COMPANY NAME
It is proposed that subject to the approval of the Registrar
of Companies in Bermuda, the name of Harbour Ring International
Holdings Limited will be changed to ICG AsiaWorks Limited to
reflect the change in control of the Company and the
anticipated future development of the Company. The change of
name will also be subject to the passing of a special resolution
by the shareholders of the Company at a special general meeting
to approve such change.
MAINTAINING THE LISTING OF THE COMPANY
It is the intention of the directors of ICG to maintain the
listing of the Company on the Stock Exchange after Completion.
The directors of ICG will jointly and severally undertake to
the Stock Exchange that appropriate steps will be taken to
ensure that sufficient public float exists for the Shares
within one month after the Completion. The directors including
the new directors of the Company will jointly and severally
undertake to the Stock Exchange that appropriate steps will
be taken to ensure that sufficient public float exists for the
Shares within one month after the Completion.
The Stock Exchange has stated that it will closely monitor
trading in the Shares if less than 25% of the Shares are held
by the public. The future directors of the Company are aware
of the possibility of the Company public float falling below
25% immediately after Completion and will address this issue
accordingly, including by means of the placement of shares.
If the Stock Exchange believes that:
* a false market exists or may exist in the Shares; or
* there are too few Shares in public hands to maintain an
orderly market,
it will consider exercising its discretion to suspend trading
in the Shares. In this connection, it should be noted that upon
the Completion, there may be insufficient public float for the
Shares and therefore trading in the Shares may be suspended
until a sufficient level of public float is attained.
The Stock Exchange will also closely monitor all future
acquisitions or disposals of assets by the Company. The Stock
Exchange has the discretion to require the Company to issue
a circular to its shareholders irrespective of the size of any
proposed transaction, particularly when such proposed
transaction represents a departure from the principal
activities of the Company. The Stock Exchange also has the
power to aggregate a series of transactions and any such
transactions may result in the Company being treated as if it
were a new listing applicant.
SUSPENSION AND RESUMPTION OF TRADING IN THE SECURITIES
Trading in the securities of the Company on the Stock Exchange
was suspended at the request of the Company with effect from
2.30 p.m. on 1st March, 2000 pending release of this
announcement. Application has been made by the Company for the
resumption of trading in the securities of the Company with
effect from 10.00 a.m. on 10th March, 2000.
ADDITIONAL INFORMATION
In consideration of HWL providing the representations,
warranties, undertakings and indemnity as warrantor in favour
of ICG under the Subscription Agreements and giving the Option
Deed Guarantee;
(a) International Toys and Reading have irrevocably and
unconditionally granted to Morgania Wave Limited, an indirect
wholly owned subsidiary of HWL, an option to sell to
International Toys and Reading all shares in issue as are held
by it in Shamrock at HK$112,706,610 during a 14 days period
commencing from the date the Company gives notice of its
intention to exercise the Put Option; and
(b) Reading and International Toys have irrevocably and
unconditionally undertaken, jointly and severally, to
indemnify HWL from and against 50% of, amongst others, all
claims and loans which HWL may incur in connection with the
giving of the warranties and representations, the Subscription
Agreements and the giving of the Option Deed Guarantee,
provided that the aggregate liability of Reading and
International Toys under such indemnity shall not be less than
US$75 million.
A memorandum of understanding between HWL and ICG relating to
the formation of a company to be engaged in the web-based
business-to-business procurement portal in Asia has been
signed on 9th March, 2000. Such company will be initially owned
as to 65% by HWL and 35% by ICG.
GENERAL
Reading and International Toys have undertaken to the Company
that out of an aggregate of 649,600,000 Shares held by them,
they will not dispose of 50% of such Shares, being 324,800,000
Shares and representing approximately 5.9% of the issued share
capital of the Company as enlarged by the Subscriptions and
assuming all the outstanding employees share options of the
Company are exercised in full until six months after the
Completion. As for 110,000,000 Shares out of the other
324,800,000 Shares, Reading and International Toys have
undertaken to the Company to dispose such Shares to independent
third parties within two weeks after the Completion with an
aim to achieving the minimum public shareholding of the
Company.
The Company will also enter into the Management Services
Agreement at or prior to Completion with Union Court Holdings
Limited, Dr. Luk Chung Lam, Messrs. Ko Yuet Ming, Tam Yue Man
and Luk Tei, Lewis, under which Union Court Holdings Limited
agrees to provide management services to the Group and the
Company agrees to give Union Court Holdings Limited the
exclusive right to manage and operate the Toy and Property
Operations on terms that are no better than those under the
existing employment arrangements of Dr. Luk Chung Lam, Messrs.
Ko Yuet Ming, Tam Yue Man and Luk Tei, Lewis. It is expected
that the Toy and Property Operations will, after Completion,
be managed in the same way as they were prior to the date of
this announcement.
The entering into of the Hutchison Subscription Agreement
constitutes a connected transaction for the Company under the
Listing Rules. Similarly, the entering into of the Option Deed
also constitutes a connected transaction for the Company under
the Listing Rules. The entering into of the Management Services
Agreement also constitutes a connected transaction for the
Company under the Listing Rules.
An independent board committee of the board of directors of
the Company will be appointed to consider the Subscriptions,
the Option Deed and the Management Services Agreement. An
independent financial adviser will be appointed to advise the
independent board committee regarding the Subscriptions, the
Option Deed and the Management Service Agreement. Dr. Luk Chung
Lam and his Associates and Concert Parties, and HWL and its
Concert Parties will abstain from voting on the resolutions
to approve the Subscriptions, the Option Deed and the
Management Services Agreement respectively.
Goldman Sachs (Asia) L.L.C. has been appointed to advise ICG
in connection with this transaction. BNP Prime Peregrine
Capital Limited has been appointed to advise the Company in
connection with this transaction.
Application will be made to the Stock Exchange for the listing
of, and permission to deal in, the New Shares to be issued under
the Subscriptions and on exercise of the Warrants.
A composite document containing details of the Subscriptions,
the Option Deed, the Management Services Agreement the advice
of the independent committee of the board of directors, the
advice of the independent financial adviser and notice of a
special general meeting, will be sent to the shareholders of
the Company as soon as practicable.
In this announcement, the following expressions have the
meanings set out below unless the context requires otherwise.
``Associate(s)'' has the meaning ascribed thereto under the Listing Rules
``Company'' Harbour Ring International Holdings Limited, a company
incorporated in Bermuda with limited liability, the Shares of
which are listed on the Stock Exchange
``Completion'' completion of the Subscription Agreements
``Concert Parties'' has the meaning ascribed thereto under the Takeover
Code
``Executive'' the Executive Director of the Corporate Finance Division of
the SFC or any delegate of the Executive Director
``Group'' the Company and its subsidiaries
``Hong Kong'' Hong Kong Special Administrative Region of the People's
Republic of China
``HWL'' Hutchison Whampoa Limited which is a company incorporated in
Hong Kong with limited liability and the shares of which are
listed on the Stock Exchange
``Hutchison Subscription Agreement'' the subscription agreement dated 9th
March, 2000 between the Company and HWL relating to the subscription for
454,978,000 Shares in aggregate
``HWL Sub'' Promising Land International Inc., a company incorporated in
the British Virgin Islands with limited liability and a wholly
owned subsidiary of HWL
``ICG'' Internet Capital Group, Inc., a company incorporated in the
State of Delaware in the US with limited liability, the shares
of which are listed on NASDAQ
``ICG Subscription Agreement'' the subscription agreement dated 9th March,
2000 between the Company and ICG relating to the subscription by ICG for
3,018,400,000 Shares in aggregate
``Independent Shareholders'' shareholders of the Company other than Dr.
Luk Chung Lam and his Associates and Concert Parties, and HWL and its
Concert Parties
``International Toys'' International Toys (B.V.I.) Limited
``LKS Foundation'' Li Ka Shing Foundation Limited, a company established
in accordance with the laws of Hong Kong
``LKS Foundation Subscription Agreement'' the subscription agreement
dated 9th March, 2000 between the Company and LKS Foundation relating to
the subscription for 274,400,000 Shares in aggregate
``Listing Rules'' Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited
``Management Services Agreement'' the agreement to be entered into
between the Company and Union Court Holdings Limited for the provision of
management services to the Group
``NASDAQ'' the Nasdaq Stock Market, Inc. in the US
``New Share(s)'' 3,747,778,000 new Shares to be issued pursuant to the
Subscriptions
``Option Deed'' the deed dated 9th March, 2000 granted by Shamrock in
favour of the Company pursuant to which Shamrock grants the Put Option
to the Company
``Option Deed Guarantee'' the performance guarantee of Shamrock given by
HWL under the Option Deed
``Put Option'' the option granted by Shamrock to the Company to require
Shamrock to acquire all (but not part only) of the Toy and
Property Operations at a consideration of HK$225,413,200
exercisable during a period of two years after Completion
subject to provisions for extension thereof
``Reading'' Reading Investments Limited
``SFC'' Securities and Futures Commission
``Shamrock'' Shamrock Green Limited
``Share(s)'' ordinary share(s) of HK$0.10 each in the capital of the
Company
``Share Option Scheme'' the employee share option scheme adopted by the
Company on 6th June, 1991
``Special Deal Consent'' the consent from the Executive required under
Note 4 to Rule 25 of the Takeover Code
``Subscribers'' ICG, HWL Sub and LKS Foundation
``Subscriptions'' the subscriptions of the New Shares and the Warrants by
ICG, HWL Sub and LKS Foundation respectively on the terms of the
Subscription Agreements
``Subscription Agreements'' the ICG Subscription Agreement, the Hutchison
Subscription Agreement and the LKS Foundation Subscription Agreement
``Stock Exchange'' The Stock Exchange of Hong Kong Limited
``Takeover Code'' The Hong Kong Code on Takeovers and Mergers
``Toy and Property Operations'' the assets, rights and title owned by and
liabilities owed or owing by toy and property interests and activities of
the Group together with the liabilities owed or owed by the Group in
respect of the toy and property interests and activities of
the Group
``Warrant(s)'' the warrant(s) to be issued by the Company to ICG, HWL and
LKS Foundation conferring the Subscribers the right to subscribe
for up to 1,095,000,000 new Shares in aggregate during the
period of three years after the date of issue at an initial
subscription price of HK$0.39 per Share
``Whitewash Waiver'' a waiver from the obligation to make a general offer
under the Takeover Code pursuant to Note 1 on dispensations from Rule
26 of the Takeover Code
``US'' United States of America
``HK$'' Hong Kong dollar(s), the lawful currency in Hong Kong
``US$'' United States dollar(s), the lawful currency in the US
In this announcement, for reference only and unless otherwise
specified, the translation of United States dollars into Hong
Kong dollars is based on the exchange rate of HK$7.78 to US$1.00
By Order of the board of
Internet Capital Group, Inc.
Kenneth A. Fox
Managing Director
By Order of the board of
Hutchison Whampoa Limited
Edith Shih
Company Secretary
By Order of the board of
Harbour Ring International Holdings Limited
Luk Chung Lam
Chairman
Hong Kong, 9th March, 2000
The directors of ICG jointly and severally accept full
responsibility for the accuracy of the information contained
in this announcement (other than that relating to the HWL group
and the Group) and confirm, having made all reasonable
enquiries, that to the best of their knowledge, opinions
expressed in this announcement have been arrived at after due
and careful consideration and there are no other facts (other
than those relating to the HWL group and the Group) not
contained in this announcement, the omission of which would
make any statement in this announcement misleading.
The directors of HWL jointly and severally accept full
responsibility for the accuracy of the information contained
in this announcement (other than that relating to ICG and the
Group) and confirm, having made all reasonable enquiries, that
to the best of their knowledge, opinions expressed in this
announcement have been arrived at after due and careful
consideration and there are no other facts (other than those
relating to ICG and the Group) not contained in this
announcement, the omission of which would make any statement
in this announcement misleading .
The directors of the Company jointly and severally accept full
responsibility for the accuracy of the information contained
in this announcement (other than that relating to ICG and the
HWL group) and confirm, having made all reasonable enquiries,
that to the best of their knowledge, opinions expressed in this
announcement have been arrived at after due and careful
consideration and there are no other facts (other than those
relating to ICG and the HWL group) not contained in this
announcement, the omission of which would make any statement
in this announcement misleading.
|
