LEGEND HOLD<0992> - Announcement
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.
LEGEND HOLDINGS LIMITED
(Incorporated in Hong Kong with limited liability)
PLACING OF EXISTING SHARES AND SUBSCRIPTION FOR NEW SHARES
SUMMARY
Legend Group Holdings Co., a controlling shareholder of
Legend Holdings Limited has agreed on 29th February, 2000
to place the Placing Shares at the Placing Price and to
subscribe for the Subscription Shares at the Subscription
Price. The Placing Shares amount to approximately 4.72% of
the existing issued share capital of the Company and
approximately 4.59% of the enlarged issued share capital of
the Company following the completion of the Subscription.
The Placing Shares will be sold to independent professional,
institutional and/or individual investors through Goldman
Sachs (Asia) L.L.C. for itself and its affiliates as the
placing agent and underwriter.
The intended use of the net proceeds of the Subscription of
approximately HK$1,651 million is described below.
The Vendor beneficially owns 1,093,136,286 Shares
representing approximately 60.72% of the existing issued
share capital of the Company. The percentage of shareholding
of the Vendor in the Company after completion of the Placing
but before completion of the Subscription is approximately
56% and after completion of both the Placing and the
Subscription is approximately 57.19%.
AGREEMENT TO PLACE THE PLACING SHARES AND AGREEMENT TO
SUBSCRIBE FOR THE SUBSCRIPTION SHARES BOTH DATED 29TH
FEBRUARY, 2000
VENDOR
Legend Group Holdings Co., the controlling shareholder of
the Company and a company incorporated in the People's
Republic of China which presently beneficially holds
1,093,136,286 Shares, representing approximately 60.72% of
the existing issued share capital of the Company.
NUMBER OF SHARES TO BE PLACED:
85,000,000 Shares including the over-allotment option of
15,000,000 Shares representing approximately 4.72% of the
existing issued share capital of the Company and
approximately 4.59% of the enlarged share capital of the
Company after the Subscription will be placed pursuant to
the Placing. Pursuant to the placing agreement the placing
agent has exercised the over-allotment option of an
aggregate of 15,000,000 additional Shares to cover the
over-allotments in the Placing.
SHARES PLACED TO:
Independent professional, institutional and/or individual
investors (the number of which is more than 6).
PLACING PRICE:
The Placing Price, being HK$33.75 per Placing Share. The
Placing Price was agreed to after arm's length negotiations
and represents a discount of approximately 6.25% to the last
traded price of HK$36 per Share quoted on The Stock Exchange
of Hong Kong Limited (the "Stock Exchange") at the close of
business on 29th February, 2000 and a discount of
approximately 1.03% to the average closing price of the
Shares as quoted on the Stock Exchange for the last five
trading days leading up to and including 29th February, 2000.
The directors of the Company are of the view that this price
is fair and reasonable for the Company.
PLACING AGENT AND UNDERWRITER:
Goldman Sachs (Asia) LLC for itself and its affiliates, which
fully underwrites the Placing.
INDEPENDENCE OF PLACEES AND THE PLACING AGENT:
The placees and the placing agent are independent of and not
connected with the Vendor or any of its associates or the
directors, chief executive or substantial shareholders of
the Company or its subsidiaries or any of their respective
associates (as defined in the Rules Governing the Listing
of Securities on the Stock Exchange) or any of them.
CONDITIONS AND COMPLETION OF THE PLACING:
The Placing is conditional upon, inter alia, no force majeure
events occurring on or before completion of the Placing.
Completion of the Placing is expected to take place on 3rd
March, 2000 or such other date as the parties may agree.
MAINTENANCE OF SHAREHOLDING BY THE VENDOR:
Under the placing agreement, the Vendor has agreed that
neither it, nor any of the companies controlled by it nor
the Company will sell or allot any Shares or securities
convertible into Shares, without the prior consent of
Goldman Sachs (Asia) LLC, until the date being the three
months after the date of the placing agreement.
NUMBER OF SUBSCRIPTION SHARES SUBSCRIBED FOR:
50,000,000 Subscription Shares representing approximately
2.78% of the Company's existing issued share capital and
approximately 2.70% of the Company's issued share capital
as enlarged by the Subscription.
SUBSCRIBER FOR THE SUBSCRIPTION SHARES:
The subscriber for the Subscription Shares is the Vendor
and/or Right Lane Limited, a company incorporated in Hong
Kong and a wholly-owned subsidiary of the Vendor. As far as
the Directors are aware, there is no other substantial
shareholder of the Company.
SUBSCRIPTION PRICE
the Subscription Price, HK$33.75 per Subscription Share
which is the same as the Placing Price or, HK$8.4375 per
Subscription Share if the Share Subdivision Resolution is
passed.
MANDATE TO ISSUE SUBSCRIPTION SHARES:
The Subscription Shares will be issued pursuant to the
general mandate granted to the directors of the Company by
resolution of its shareholders passed on 13th July, 1999.
RANKING:
The Subscription Shares will, when issued and allotted, rank
pari passu in all respects inter se and with all other shares
in the share capital of the Company then in issue.
CONDITIONS OF THE SUBSCRIPTION:
Completion of the Subscription is conditional upon:-
(a) listing of and permission to deal in all the
Subscription Shares 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 the
Subscription Shares); and
(b) completion of the Placing.
If the conditions for the Subscription set out above are not
fulfilled or waived in writing by the Vendor on or before
13th March, 2000 (or such later date as the Vendor and the
Company may agree), the subscription agreement will cease
and terminate.
Application will be made to the Stock Exchange for listing
of the Subscription Shares on the Stock Exchange.
COMPLETION OF THE SUBSCRIPTION:
The Subscription will take place on the date falling two
business day(s) after the date upon which the last of the
conditions for the Subscription referred to above is
satisfied provided that such date shall not be later than
the date falling 14 days after 29th February, 2000, being
13th March, 2000, or such later date as the Company and the
Vendor may agree.
CHANGES TO THE SHAREHOLDING IN THE COMPANY AS A RESULT OF
THE PLACING AND THE SUBSCRIPTION:
The Vendor beneficially owns 1,093,136,286 Shares,
representing approximately 60.72% of the existing issued
share capital of the Company.
The percentage of shareholding of the Vendor in the Company
immediately before completion of the Placing, after
completion of the Placing but before completion of the
Subscription, and after completion of both the Placing and
the Subscription are as follows:-
After completion
of the Placing but After completion
Immediately before before completion of both the Placing
completion of the of the Subscription and the
Placing Subscription
Approximately 60.72% Approximately 56% Approximately 57.19%
USE OF PROCEEDS:
The net proceeds of the Subscription will amount to
approximately HK$1,651 million and is intended to be used
by the Company as follows: HK$700 million to HK$800 million
for investment and acquisition in Internet content providers
or acquisition of the rights to use their content; HK$300
million to HK$400 million for development of Internet access
devices and Internet technology and services; HK$300 million
to HK$400 million for research and development and marketing
of e-commerce solutions and the remaining balance for
general working capital of the Company. No specific project
has yet been identified by the Company for the use of proceeds
at this moment.
REASONS FOR THE SUBSCRIPTION:
The purpose of the Subscription is to raise funds for the
purposes described in the section "Use of Proceeds" above.
EXPENSES:
The Company bears the expenses incurred by the Vendor and/or
Right Lane Limited in connection with the Placing in respect
of 50,000,000 Shares and the Subscription after deducting
interest received by the Vendor and/or Right Lane Limited
on the net proceeds of the Placing from completion of the
Placing to completion of the Subscription. Any interest
income on the net proceeds of the Placing will accrue to the
Company.
Expenses of the Placing in respect of 35,000,000 Placing
Shares incurred by the Vendor will be borne by the Vendor
solely.
DEFINITIONS
"Company" Legend Holdings Limited
"Placing" the placing of the Placing Shares
at the Placing Price under the
placing agreement dated 29th
February, 2000
"Placing Price" HK$33.75 per Placing Share
"Placing Share(s)" 85,000,000 Shares (including an
over-allotment option of an
additional 15,000,000 Shares
which has been exercised in full
by the placing agent)
"Share(s)" existing shares of HK$0.10 each
in the share capital of the
Company
"Share Subdivision the ordinary resolution of the
Resolution" Company in relation to
subdivision of Shares to be
proposed at the extraordinary
general meeting of the Company to
be held on 7th March 2000
"Subscription" the subscription of the
Subscription Shares at the
Subscription Price under the
subscription agreement dated
29th February, 2000
"Subscription Price" HK$33.75 per Subscription Share
or, HK$8.4375 per Subscription
Share if the Shares Subdivision
Resolution is passed
"Subscription Share(s)" 50,000,000 new Shares or,
200,000,000 new shares of
HK$0.025 each in the Company if
the Share Subdivision Resolution
is passed
"Vendor" Legend Group Holdings Co., a
controlling shareholder of the
Company
By Order of the Board
Legend Holdings Limited
Liu Chuanzhi
Chairman
Hong Kong, 29th February, 2000
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