Asia Standard International : Major Transaction in relation to Investment in the Guangzhou R&F Notes

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this joint announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this joint announcement.

ASIA ORIENT HOLDINGS	ASIA STANDARD INTERNATIONAL	ASIA STANDARD HOTEL
LIMITED	GROUP LIMITED	GROUP LIMITED
滙漢控股有限公司*	泛海國際集團有限公司*	泛海酒店集團有限公司*
(Incorporated in Bermuda	(Incorporated in Bermuda	(Incorporated in Bermuda
with limited liability)	with limited liability)	with limited liability)
(Stock Code: 214)	(Stock Code: 129)	(Stock Code: 292)
DISCLOSEABLE	MAJOR	MAJOR
TRANSACTION	TRANSACTION	TRANSACTION

IN RELATION TO

INVESTMENT IN THE GUANGZHOU R&F NOTES

THE INVESTMENT

On 12 January 2021, AO Investor, ASI Investor and ASH Investor entered into the TRS Arrangements arranged by Morgan Stanley in relation to the investments in the 6.58% Guangzhou R&F Notes at an aggregate consideration (including unpaid interests accrued) of approximately RMB109.6 million (equivalent to approximately HK$130.2 million), approximately RMB219.3 million (equivalent to approximately HK$260.5 million) and approximately RMB92.8 million (equivalent to approximately HK$110.2 million) respectively.

LISTING RULES IMPLICATIONS

As all of the applicable percentage ratios in respect of the Investment, after aggregation with the Previous Investments, would still be classified as a major transaction for AO under Chapter 14 of the Listing Rules, and since AO has complied and will comply with the major transaction requirements in respect of the Major Transaction as set out in the Announcement, AO is not required to reclassify the Investment by aggregating it with the previous acquisition of and investments in the Guangzhou R&F Notes by AO Group before and including 21 December 2020.

As one or more of the applicable percentage ratios in respect of the Investment, after aggregation with the previous investments in the Guangzhou R&F Notes by AO Group after 21 December 2020, exceeds 5% but is or are less than 25% for AO, the Investment constitutes a discloseable transaction for AO, and is therefore subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

As one or more of the applicable percentage ratios in respect of the Investment, after aggregation with the Previous Investments, exceeds 25% but is or are less than 100% for each of ASI and ASH, the Investment constitutes a major transaction for each of ASI and ASH, and is therefore subject to the reporting, announcement, circular and shareholders' approval requirements under Chapter 14 of the Listing Rules.

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Given that none of the ASI Shareholders have a material interest in the Investment, none of them would be required to abstain from voting if a general meeting of ASI were to be convened to approve the Investment. Pursuant to Rule 14.44 of the Listing Rules, ASI has obtained a written approval from the ASI Closely Allied Group (which together hold approximately 51.892% of the issued share capital of ASI as at the date of this joint announcement) to approve the Investment. Therefore, no general meeting of ASI will be convened to approve the Investment.

Given that none of the ASH Shareholders have a material interest in the Investment, none of them would be required to abstain from voting if a general meeting of ASH were to be convened to approve the Investment. Pursuant to Rule 14.44 of the Listing Rules, ASH has obtained a written approval from The Sai Group (which holds approximately 64.35% of the issued share capital of ASH as at the date of this joint announcement) to approve the Investment. Therefore, no general meeting of ASH will be convened to approve the Investment.

DESPATCH OF CIRCULAR

A circular containing further information on the Investment will be despatched to the ASI Shareholders and ASH Shareholders respectively as soon as possible, which is expected to be on or before 5 February 2021.

THE INVESTMENT

On 12 January 2021, AO Investor, ASI Investor and ASH Investor entered into the TRS Arrangements arranged by Morgan Stanley in relation to the investments in the 6.58% Guangzhou R&F Notes by way of the total return swap arrangements in an aggregate notional amount of RMB130.0 million (equivalent to approximately HK$154.4 million), RMB260.0 million (equivalent to approximately HK$308.9 million) and RMB110.0 million (equivalent to approximately HK$130.7 million) at an aggregate consideration (including unpaid interests accrued) of approximately RMB109.6 million (equivalent to approximately HK$130.2 million), approximately RMB219.3 million (equivalent to approximately HK$260.5 million) and approximately RMB92.8 million (equivalent to approximately HK$110.2 million) respectively.

INFORMATION ON THE 6.58% GUANGZHOU R&F NOTES

The 6.58% Guangzhou R&F Notes bear interest at a rate of 6.58% per annum, payable in arrears on each anniversary of the issue date until the maturity date of 4 December 2022, and are listed and quoted on the Shanghai Stock Exchange.

Guangzhou R&F and its subsidiaries are principally engaged in the development and sale of properties, property investment, hotel operations and other property development related services in the PRC.

Given that the 6.58% Guangzhou R&F Notes are the underlying reference notes of the TRS Arrangements, AO Group, ASI Group and ASH Group will not have actual ownership interest or any proprietary rights in such notes. Instead, AO Group, ASI Group and ASH Group will hold the notes issued by Emerald Bay under the TRS Arrangements which are linked to the 6.58% Guangzhou R&F Notes and structured based on the total return swap arrangements between Emerald Bay and Morgan Stanley.

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REASONS FOR AND BENEFITS OF THE INVESTMENT

The Investment forms part of the investing activities of AO Group, ASI Group and ASH Group, which were conducted in their ordinary and usual course of business. As part of their principal business, AO Group, ASI Group and ASH Group monitor the performance of their respective securities portfolios and make adjustments to them (with regard to the types and/or amounts of the securities held) from time to time. AO Group, ASI Group and ASH Group intend to fund the Investment by their respective internal cash resources.

Having considered the terms of the Investment (including the consideration (which includes unpaid interests accrued on the 6.58% Guangzhou R&F Notes), interest rate and maturity date of the 6.58% Guangzhou R&F Notes, etc.), AO Directors, ASI Directors and ASH Directors respectively are of the view that such terms are fair and reasonable and the Investment is in the interests of AO, ASI, ASH and their respective shareholders as a whole.

INFORMATION ON AO, ASI, ASH, AO INVESTOR, ASI INVESTOR AND ASH INVESTOR

AO is a limited liability company incorporated in Bermuda whose shares are listed on the Main Board. AO Group is principally engaged in property management, development and investment, hotel operations and securities investments.

ASI is a limited liability company incorporated in Bermuda whose shares are listed on the Main Board. ASI Group is principally engaged in investment and development of commercial, retail and residential properties and securities investments. Through ASH, ASI Group is also involved in hotel operations.

ASH is a limited liability company incorporated in Bermuda whose shares are listed on the Main Board. The principal activity of ASH is investment holding. The principal activities of the subsidiaries of ASH consist of holding and operating hotels, property development and securities investments.

AO Investor is a company incorporated in the British Virgin Islands with limited liability and an indirect wholly-owned subsidiary of AO. As at the date hereof, it is principally engaged in securities investment.

ASI Investor is a company incorporated in the British Virgin Islands with limited liability and an indirect wholly-owned subsidiary of ASI. As at the date hereof, it is principally engaged in securities investment.

ASH Investor is a company incorporated in the British Virgin Islands with limited liability and an indirect wholly-owned subsidiary of ASH. As at the date hereof, it is principally engaged in securities investment.

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LISTING RULES IMPLICATIONS

As all of the applicable percentage ratios in respect of the Investment, after aggregation with the Previous Investments, would still be classified as a major transaction for AO under Chapter 14 of the Listing Rules, and since AO has complied and will comply with the major transaction requirements in respect of the Major Transaction as set out in the Announcement, AO is not required to reclassify the Investment by aggregating it with the previous acquisition of and investments in the Guangzhou R&F Notes by AO Group before and including 21 December 2020.

As one or more of the applicable percentage ratios in respect of the Investment, after aggregation with the previous investments in the Guangzhou R&F Notes by AO Group after 21 December 2020, exceeds 5% but is or are less than 25% for AO, the Investment constitutes a discloseable transaction for AO, and is therefore subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

As one or more of the applicable percentage ratios in respect of the Investment, after aggregation with the Previous Investments, exceeds 25% but is or are less than 100% for each of ASI and ASH, the Investment constitutes a major transaction for each of ASI and ASH, and is therefore subject to the reporting, announcement, circular and shareholders' approval requirements under Chapter 14 of the Listing Rules.

Given that none of the ASI Shareholders have a material interest in the Investment, none of them would be required to abstain from voting if a general meeting of ASI were to be convened to approve the Investment. Pursuant to Rule 14.44 of the Listing Rules, ASI has obtained a written approval from the ASI Closely Allied Group (which together hold approximately 51.892% of the issued share capital of ASI as at the date of this joint announcement) to approve the Investment. Therefore, no general meeting of ASI will be convened to approve the Investment. The ASI Closely Allied Group comprises the following ASI Shareholders:

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