Road King Infra (01098) announced that its wholly-owned subsidiary ECL signed a sale and purchase agreement with individual sellers, buyers, and the target company (with ECL and individual sellers holding 40% and 60% equity interests, respectively) on September 2, 2024. According to the agreement, the buyer will purchase 85.15% of the equity interest of the target company (Predaptive OD Limited) for up to £22.825 million (whereby ECL is entitled to receive £12 million upon completion). After the completion of the sale, the Group will no longer have any interests in the target company.

The target company, along with its wholly-owned subsidiary Holovis, is primarily engaged in the design, installation, and immersive and interactive multi-sensory transformation solutions, experience projects, and attraction of comprehensive businesses (i.e. target businesses). The individual sellers are the founders and/or senior management of the target group's businesses. ECL (as part of the Group's investment and asset management business segment) invested in the target company in 2018 to support potential cooperation between the Group and the target group, incorporating entertainment facilities into the Group's commercial property portfolio. Although the Group initially collaborated with the target group on two projects in China (facilities located outside the Group's property portfolio), there were no collaborations between the Group and the target group on the Group's properties.

The Board of Directors considered the following factors: (i) an inflow of £12 million in cash (excluding related expenses of the sale) intended for reallocation for the Group's general operating funds; (ii) based on the target group's past losses, its financial condition, and the slow recovery of its operating market (especially in mainland China), it is unlikely for ECL to recover its investment in the target group; (iii) if ECL does not proceed with the sale, the target group is likely to continue to seek financial assistance to develop its business, and if ECL does not provide further financial assistance, its investment will be diluted. Therefore, the Board of Directors believes that the terms of the sale (the purchase price payable to the Group) are fair and reasonable and in line with the overall interests of the Group.