Gelonghui November 21丨Wang ON GROUP (01222.HK) and Wai Yuen Tong (00897.HK) jointly announced that on November 21, 2023, the seller Guidepost Investments Limited (an indirect wholly-owned subsidiary of Wai Yuen Tong) and the guarantor entered into an interim agreement with the buyer Ascend Progress Limited and the property agent. According to this, the buyer conditionally agreed to sell all of the target company Donghua Investment Co., Ltd. Issuance of shares and transfer of sales loan benefits to the buyer at a cost of HK$100 million.
The target company is a limited company incorporated in Hong Kong, and all of its issued share capital is owned by the seller. Therefore, the target company is listed as a subsidiary in Wai Yuen Tong's consolidated financial statements. It is mainly engaged in holding the property (that is, its main asset).
The property is a shop unit located at Shop AB on the ground floor of Po Wing Building, 61, 63, 65, 67, 71 and 73 Lee Garden Road, Hong Kong, and stores at 108, 110, 112, 116, 118 and 120 Percival Street. The total useful area is about 1,204 square feet. On the date of the joint announcement, Wai Yuen Tong Group used the property as its own retail store.
From time to time, Director Wang An and Director Wai Yuen Tong conduct strategic reviews of the business and assets of Wai Yuen Tong Group and Wai Yuen Tong Group separately. The property was acquired by the target company in 2015 and has been used by Wai Yuen Tong's own retail store ever since. After considering the overall downturn in the commercial property market, the location of the property, surrounding stores, capital growth potential and rental income, directors of Wang An and Director Wai Yuen Tong believed that the sale not only brought an opportunity for Hongan Group and Wai Yuen Tong Group to monetize the value of the property at the appropriate time, but also used the net proceeds from the sale to repay bank loans to reduce liabilities, while the sale and leasing back of the property enabled Wai Yuen Tong Group to continue retail business.