ING BEIJING<1062> - Announcement
ING BEIJING INVESTMENT COMPANY LIMITED
SHARE TRANSACTION
The Board of Directors of ING Beijing Investment Company Limited announces
that on 15th May, 2000, a subsidiary of the Company entered into a
conditional agreement for the subscription of a 2.28% interest in the
capital of Skynet Limited, a Hong Kong company engaged in the Internet
business.
Out of the total consideration of US$5 million (equivalent to
HK$38,822,000), US$1,000,000 (equivalent to HK$7,750,000) is to be settled
in cash and US$4 million (equivalent to HK$31,072,000) is to be settled by
the issuance of 38,840,000 new shares of HK$ 0.10 each of the Company at
an issue price of HK$0.80 per Share.
In connection with the said agreement, the Company's subsidiary has been
granted an option to require Skynet International (Group Holdings) Limited
to acquire from it the shares of Skynet Limited in exchange for new shares
in the capital of Skynet International (Group Holdings) Limited.
Furthermore, the Company's subsidiary has an option to require Skynet
Limited to sell to it such number of shares and/or securities held by
Skynet Limited in its subsidiaries as shall be equivalent to the
attributable indirect interest held by the Company's subsidiary in the
subsidiaries of Skynet Limited.
Date of the agreement (the "Agreement")
15th May, 2000
Parties to the Agreement
The issuer - Skynet Limited ("Skynet"), a company incorporated in Hong
Kong and a 57.5% subsidiary of Skynet Holdings (as defined below).
The warrantor - Skynet International (Group Holdings) Limited ("Skynet
Holdings"), a company incorporated in Bermuda, the securities of which are
listed on The Stock Exchange of Hong Kong Limited (the "Stock Exchange").
The subscriber - Hidden Advantage Investments Limited (the "Company's
Subsidiary"), a company incorporated in the British Virgin Islands, and a
wholly owned subsidiary of ING Beijing Investment Company Limited (the
"Company").
Neither Skynet nor Skynet Holdings is connected with the directors, the
chief executive officer and the substantial shareholders of the Company,
its subsidiaries and/or its associates (as defined in the Rules Governing
the Listing of Securities (the "Listing Rules") on the Stock Exchange). At
present, the Company's Subsidiary holds a 3.05% interest in Skynet, but
does not hold any interest in Skynet Holdings. At completion of the
Agreement, the Company's Subsidiary will hold a 5.33% interest in Skynet,
all of which are subject to the Call Option and the Put Option (as defined
below).
Asset to be purchased
Such ordinary shares of HK$1.00 each in the capital of Skynet
(the "Skynet Shares") as representing 2.33% of the existing issued share
capital of Skynet and 2.28% of the enlarged issued share capital of Skynet
at completion of the Agreement.
Consideration
The total consideration for the Skynet Shares is US$5,000,000 to be
settled in the following manner:
(a) US$1 million in cash to be paid upon completion of the
Agreement; and
(b) US$4 million to be settled upon completion by the issue of
38,840,000 Shares (the "Consideration Shares") by the Company to Skynet at
an issue price of HK$0.80 per Share. The Consideration Shares represent
7.768% of the existing issued share capital of the Company and 7.208% of
the issued share capital of the Company as enlarged by the Consideration
Shares.
The issue price of HK$0.80 per Share represents a premium of approximately
191.23% against the average closing price of HK$0.2747 per Share from 28th
April, 2000 to 15th May, 2000 (both days inclusive), being the last ten
trading days immediately prior to the date of this announcement and a
premium of 221.29% against the closing price of HK$0.249 per Share on 15th
May, 2000.
The cash element of the consideration is to be satisfied by the internal
resources of the Company.
Conditions precedent
Completion of the Agreement is subject to the satisfaction of certain
conditions precedent which include the granting by the Listing Committee
of the Stock Exchange of listing of, and permission to deal in, the
Consideration Shares.
Such conditions are to be fulfilled on or before 15th June, 2000, and
completion will take place within three (3) business days following the
satisfaction of such conditions. If such conditions are not fulfilled on
or before 15th June, 2000, the Company's Subsidiary will be entitled to
terminate the Agreement.
General mandate
The Consideration Shares to be issued upon completion of the Agreement
will be issued pursuant to the general mandate granted to the directors of
the Company at the annual general meeting held on 21st June, 1999. Such
mandate is valid and subsisting and has not been revoked.
Ranking of the Consideration Shares
The Consideration Shares will rank pari passu in all respects with the
issued Shares of the Company.
Application for listing
Application will be made by the Company to the Stock Exchange for the
listing of, and permission to deal in, the Consideration Shares.
Option
In connection with the Agreement, Skynet Holdings has granted to the
Company's Subsidiary, under a separate deed, an option (the "Option") to
require Skynet Holdings to acquire from it the Skynet Shares in exchange
for new shares of HK$0.02 each in the capital of Skynet Holdings.
The grantor - Skynet Holdings
The grantee - the Company's Subsidiary
The Option - the right to require Skynet Holdings to acquire the Skynet
Shares held by the Company's Subsidiary.
Exercise period of the Option - subject to completion of the Agreement, a
two-year period commencing on the first anniversary of the completion date
of the Agreement.
Number of shares in Skynet Holdings to be issued - the number of shares in
Skynet Holdings (the "Option Shares") to be issued in exchange for the
Skynet Shares held by the Company's Subsidiary in respect of which the
Option has been exercised will be determined in the following manner:
A
-------
B
where A = (i) the fair market value of the Skynet
Shares held by the Company's Subsidiary or (ii) US$4 million if the shares
in Skynet are listed on any stock exchange within 12 months from the
completion date of the Agreement, in which case the Option is exercisable
only in respect of the Skynet Shares acquired under the Agreement
B = the fair market value of each share in Skynet
Holdings which will be equal to C + D
--------
E
C = the net tangible asset value of the non-Internet
related businesses of Skynet Holdings
D = the fair value of the Internet-related
businesses of Skynet Holdings (including the 56.19% interest in Skynet
held by Skynet Holdings after the dilution from the issue of the Skynet
Shares)
E = the number of shares in Skynet Holdings in issue
Provided that if A = US$4 million, the Company's Subsidiary will also be
paid an additional US$1 million in cash.
The fair market value of Skynet is to be appraised at the time of the
exercise of the Option by a professional valuer appointed by Skynet and
reasonably accepted by Skynet Holdings. The fair value of D is to be
appraised at the time of the exercise of the Option by a professional
valuer appointed by Skynet Holdings and reasonably accepted by the
Company's Subsidiary.
The call and put options
In connection with the Agreement, the Company's Subsidiary has been
granted by Skynet, under a separate deed, an option (the "Call Option") to
require Skynet to sell to the Company's Subsidiary such number of shares
and/or securities held by Skynet in each and all of its subsidiaries as
shall be equivalent to the attributable indirect interest held by the
Company's Subsidiary in each of such subsidiaries of Skynet. Furthermore,
the Company's Subsidiary has been granted by certain shareholders of
Skynet (as referred to below) an option (the "Put Option") to require each
of them to purchase from the Company's Subsidiary all of the Skynet Shares
held by the Company's Subsidiary.
The grantor of Call Option - Skynet
The grantee of Call Option - the Company's Subsidiary
The Call Option - the right to require Skynet to sell to the Company's
Subsidiary, at par value, such number of shares and/or security held by
Skynet (directly or indirectly) in each and all of its subsidiaries as
shall be equivalent to the attributable interest held by the Company's
Subsidiary in each of such subsidiaries through Skynet (the "Attributable
Interest").
Exercise of the Call Option - The Company' Subsidiary may exercise the
Call Option at any time during the period commencing from the notification
by Skynet to the Company's Subsidiary of any Trigger Event (as defined
below) or the listing of any of the subsidiaries of Skynet and ending on
the earlier of (i) the date following the expiry of one hundred and eighty
(180) days period therefrom; or (ii) the seventh business day immediately
prior to the completion of Trigger Event in relation to or the listing of
any subsidiary of Skynet.
Trigger Event - in relation to any subsidiary of Skynet, either the sale
or disposal by all of its shareholders of all of their shareholding in the
capital thereof to a third party or sale or disposal by Skynet of all or
substantially all of its assets to a third party.
Grantors of the Put Option - (i) Gold Cloud Agents Limited, a company
established in the British Virgin Islands ("Gold Cloud"); (ii) Saxophone
Enterprises Limited, a company establised in the British Virgin Islands
("Saxophone") and (iii) Icon Enterprises Limited, a company established in
the British Virgin Islands ("Icon"). Gold Cloud, Saxophone and Icon are
shareholders of Skynet. None of Gold Cloud, Saxophone and Icon is
connected with the directors, the chief executive officer and the
substantial shareholders of the Company, its subsidiaries and/or its
associates (as defined in the Listing Rules).
The Put Option - the option to require each of Gold Cloud, Saxophone and
Icon to purchase from the Company's Subsidiary all of the Skynet Shares
held by the Company's Subsidiary. The consideration of such purchase will
comprise payment in cash equal to the par value of the Skynet Shares held
by the Company's Subsidiary, and the assumption by Gold Cloud, Saxophone
and Icon of the liability of the Company's Subsidiary relating to the
purchase price of the Attributable Interest.
Skynet
Skynet engages in Internet-related business and has substantial interest
in three Chinese-language web sites, namely hkstock.com, hkcyber.com and
gameplayers.com.hk, with interactive features covering a wide spectrum of
subjects ranging from news and entertainment to fashion and on-line
trading facilities.
Reasons for the transactions
The Board believes that the Company's investment in Skynet will enhance
the Company's portfolio of investments in technology companies.
The directors of the Company consider that the terms of the Agreement,
together with the Option and the Call and Put Options, after arm's-length
negotiation between the parties thereto, to be fair and reasonable, and in
the interest of the Company and its shareholders as a whole.
By Order of the Board
Jan Bosma
Director
Hong Kong, 15th May, 2000
Note: In this announcement, the exchange ratio of US$1.00 to HK$7.75 is
used.
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