CONNECTED TRANSACTION The
Board of Directors of Guoco Group Limited ("Guoco") announces
that on 11th April, 1997, an Agreement for Sale and Purchase of Shares
("the Agreement") was entered into between its wholly-owned subsidiary,
Guoco Securities (Bermuda) Limited ("GSBL") and HLG Capital Berhad
("HLG"), a subsidiary of Hong Leong Company (Malaysia) Berhad
("HLCM"). Under the terms of the Agreement HLG agreed to buy
and GSBL agreed to sell 1,570,204 shares ("the Shares") of US$1.00
each in the capital of Growluck Limited ("Growluck") comprising
50% of the issued share capital of Growluck, at a total consideration of
Ringgit Malaysia 8 million (HK$24.9 million approximately). The consideration
of Ringgit Malaysia 8 million was arrived at after arm's length negotiation
on the basis of 11.26 times the average earnings of Guoco Securities (Philippines),
Inc. ("GSPI") for the 3 years ended 30th June, 1996. A 10% initial
deposit is payable on signing of the Agreement and the balance is payable
on completion. The sale proceeds will be used by Guoco as working capital.
The
transaction is conditional upon inter alia, the approval of the Kuala Lumpur
Stock Exchange and shareholders of HLG. The conditions precedent have to
be fulfilled within four months from the date of the Agreement and completion
will take place on the seventh day from the date the conditions specified
in the Agreement are satisfied. Growluck,
a wholly owned subsidiary of GSBL, is incorporated in the British Virgin
Islands and its sole asset is its 100% holding in GSPI, which engages in
stock broking business and is a member of the Philippine Stock Exchange.
GSBL will retain a 50% interest in Growluck. The
transaction with HLG will provide an expanded client base for GSPI and
will enhance opportunities to further develop GSPI's business. The independent
non-executive directors of Guoco are of the view that the terms of the
Agreement are fair and reasonable. HLCM
is a substantial shareholder of Guoco and HLG. Mr. Quek Leng Chan is a
substantial shareholder of HLCM, and is a director of Guoco and HLG. As
a result, the Agreement constitutes a connected transaction for the purpose
of the Rules Governing the Listing of Securities on The Stock Exchange
of Hong Kong Limited. The consideration for the sale of the Shares represents
less than 3% of the net tangible assets of Guoco. Details
of the Agreement will be included in the next published annual report and
accounts of Guoco. Hong Kong, 11th April, 1997
ANNOUNCEMENTS
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.
By Order of the Board
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