AV CONCEPT HOLDINGS LIMITED 
By Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this 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 announcement.
The Board is pleased to announce that on 24 February 2014 New Concept, a wholly-owned subsidiary of the Company:
(1) entered into the Warehouse Provisional Agreement with Purchaser A, pursuant to which New Concept has agreed to sell, and Purchaser A has agreed to purchase, the Warehouse at a consideration of HK$108,362,240;
(2) entered into the Carpark A Provisional Agreement with Purchaser A, pursuant to which New Concept has agreed to sell, and Purchaser A has agreed to purchase, the Carpark A at a consideration of HK$3,000,000; and
(3) entered into the Carpark B Provisional Agreement with Purchaser B, pursuant to which New Concept has agreed to sell, and Purchaser B has agreed to purchase, the Carpark B at a consideration of HK$1,500,000.
The Disposal constitutes a discloseable transaction for the Company and is subject to notification and announcement requirements of Chapter 14 of the Listing Rules.
The Board wishes to announce that on 24 February 2014 New Concept, a wholly-owned subsidiary of the Company:
(1) entered into the Warehouse Provisional Agreement with Purchaser A, pursuant to which New Concept has agreed to sell, and Purchaser A has agreed to purchase, the Warehouse at a consideration of HK$108,362,240;
(2) entered into the Carpark A Provisional Agreement with Purchaser A, pursuant to which New Concept has agreed to sell, and Purchaser A has agreed to purchase, the Carpark A at a consideration of HK$3,000,000; and
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(3) entered into the Carpark B Provisional Agreement with Purchaser B, pursuant to which New Concept has agreed to sell, and Purchaser B has agreed to purchase, the Carpark B at a consideration of HK$1,500,000.
Major terms of each of the Warehouse Provisional Agreement, the Carpark A Provisional Agreement and the Carpark B Provisional Agreement are set out below.
24 February 2014
Parties
Vendor: New Concept, a wholly-owned subsidiary of the Company. New Concept is principally engaged in investment holding.
Purchasers: Purchaser A, Multi Lines International (Properties) Limited, a company incorporated in Hong Kong with limited liability and is principally engaged in general trading.
To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, each of Purchaser A and its ultimate beneficial owner(s) is a third party independent of the Company and its connected persons.
New Concept has agreed to sell, and Purchaser A has agreed to purchase, the Warehouse at a consideration of HK$108,362,240.
The Warehouse shall be sold to Purchaser A free from encumbrances. The Warehouse is currently used by the Group as a warehouse and has not generated any rental income for the Group since acquisition in early 2012.
The Warehouse Consideration is HK$108,362,240 and the payment schedule by Purchaser A to New
Concept is as follows:
(1) HK$5,418,112, being the initial deposit, was paid by Purchaser A to New Concept at the time of the signing of the Warehouse Provisional Agreement;
(2) HK$5,418,112, being the further deposit, is payable on or before 7 March 2014; and
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(3) HK$97,526,016, being the balance of the Warehouse Consideration, is payable upon the
Warehouse Completion on or before 20 June 2014.
The Warehouse Consideration was determined after arm's length negotiations between the parties to the Warehouse Provisional Agreement on normal commercial terms with reference to the market value of similar property in similar locations. The Company has not obtained any valuation on the Warehouse in connection with the Warehouse Disposal.
Formal agreement for the Warehouse Disposal shall be signed on or before 7 March 2014 and the
Warehouse Completion is scheduled to take place on or before 20 June 2014.
24 February 2014
Parties
Vendor: New Concept. Purchaser: Purchaser A.
To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, each of Purchaser A and its ultimate beneficial owner(s) is a third party independent of the Company and its connected persons.
New Concept has agreed to sell, and Purchaser B has agreed to purchase, Carpark A at a consideration of HK$3,000,000.
Carpark A shall be sold to Purchaser A free from encumbrances. Carpark A is currently used by the
Group as a carpark and has not generated any rental income for the Group since acquisition in early
2012.
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Consideration for Carpark A
The Carpark A Consideration is HK$3,000,000 and the payment schedule by Purchaser A to New
Concept is as follows:
(1) HK$150,000, being the initial deposit, was paid by Purchaser A to New Concept at the time of the signing of the Carpark A Provisional Agreement;
(2) HK$150,000, being the further deposit, is payable on or before 7 March 2014; and
(3) HK$2,700,000, being the balance of the Carpark A Consideration, is payable upon the Carpark
A Completion on or before 20 June 2014.
The Carpark A Consideration was determined after arm's length negotiations between the parties to the Carpark A Provisional Agreement on normal commercial terms with reference to the market value of similar property in similar locations. The Company has not obtained any valuation on Carpark A in connection with the Carpark A Disposal.
Formal agreement for the Carpark A Disposal shall be signed on or before 7 March 2014 and the
Carpark A Completion is scheduled to take place on or before 20 June 2014.
24 February 2014
Parties
Vendor: New Concept.
Purchaser: Purchaser B, MTL International (Properties) Limited, a company incorporated in Hong Kong with limited liability and is principally engaged in general trading. Purchaser B is an associated company of Purchaser A.
To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, each of Purchaser B and its ultimate beneficial owner(s) is a third party independent of the Company and its connected persons.
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Assets to be disposed of
New Concept has agreed to sell, and Purchaser B has agreed to purchase, Carpark B at a consideration of HK$1,500,000.
Carpark B shall be sold to Purchaser B free from encumbrances. Carpark B is currently used by the
Group as a carpark and has not generated any rental income for the Group since acquisition in early
2012.
The Carpark B Consideration is HK$1,500,000 and the payment schedule by Purchaser B to New
Concept is as follows:
(1) HK$75,000, being the initial deposit, was paid by Purchaser B to New Concept at the time of the signing of the Carpark B Provisional Agreement;
(2) HK$75,000, being the further deposit, is payable on or before 7 March 2014; and
(3) HK$1,350,000, being the balance of the Carpark B Consideration, is payable upon the Carpark
B Completion on or before 20 June 2014.
The Carpark B Consideration was determined after arm's length negotiations between the parties to the Carpark B Provisional Agreement on normal commercial terms with reference to the market value of similar property in similar locations. The Company has not obtained any valuation on Carpark B in connection with the Carpark A Disposal.
Formal agreement for the Carpark B Disposal shall be signed on or before 7 March 2014 and the
Carpark B Completion is scheduled to take place on or before 20 June 2014.
The principal activities of the Group consist of the marketing and distribution of electronic components, and the design, development and sale of electronic products.
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As at 24 February 2014, the unaudited net asset value of the Properties was approximately HK$56,528,000. Upon completion of the Disposal, the Group expects to recognise an unaudited accounting gain of approximately HK$55,855,000, being the difference between the Consideration and the estimated net asset value of the Properties at completion of the Disposal. The actual gain or loss as a result of the Disposal to be recorded by the Group is subject to audit and will be determined as at the date of the completion of the Disposal.
The Directors expect that the net proceeds from the Disposal of approximately HK$92,808,000 will be used as general working capital of the Group and/or possible investment in the future when opportunities arise. The Directors consider that the Disposal represents an opportunity for the Group to dispose of its interests in the Property at a premium and the Disposal can enhance the cashflow of the Group. The Directors consider that the terms of each of the Warehouse Provisional Agreement, the Carpark A Provisional Agreement and the Carpark B Provisional Agreement are fair and reasonable and in the interests of the Company and the Shareholders as a whole.
The Directors are of the view that the Disposal is in the interests of the Company and the terms of the Disposal are on normal commercial terms and are fair and reasonable and in the interests of the shareholders of the Company as a whole.
The Disposal, in aggregate, constitutes a discloseable transaction for the Company and is subject to notification and announcement requirements of Chapter 14 of the Listing Rules.
DEFINITIONS
Unless otherwise specified, the following terms have the following meanings in this announcement: "Board" the board of Directors
"Carpark A" two carparks located at Car Parking Spaces L13 & L14 on Basement, Hope Sea Industrial Centre, No.26 Lam Hing Street, Kowloon, Hong Kong
"Carpark A Completion" the completion of the Carpark A Disposal
"Carpark A Consideration" the total consideration for the Carpark A Disposal payable by
Purchaser A to New Concept
"Carpark A Disposal" the disposal of Carpark A by New Concept
"Carpark A Provisional
Agreement"
the provisional sale and purchase agreement dated 24 February
2014 and entered into between Purchaser A and New Concept in respect of the Carpark A Disposal
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"Carpark B" the carpark located at Car Parking Space L12 on Basement, Hope Sea Industrial Centre, No.26 Lam Hing Street, Kowloon, Hong Kong
"Carpark B Completion" the completion of the Carpark B Disposal
"Carpark B Consideration" the total consideration for the Carpark B Disposal payable by
Purchaser B to New Concept
"Carpark B Disposal" the disposal of Carpark B by New Concept
"Carpark B Provisional
Agreement"
the provisional sale and purchase agreement dated 24 February
2014 and entered into between Purchaser B and New Concept in respect of the Carpark B Disposal
"Company" AV Concept Holdings Limited, a company incorporated in the Cayman Island with limited liability and the issued shares of which are listed on the Main Board of the Stock Exchange
"connected person(s)" has the meaning ascribed to it under the Listing Rules
"Consideration" the total consideration for the Disposal
"Disposal" collectively, the Warehouse Disposal, the Carpark A Disposal and the Carpark B Disposal
"Director(s)" the director(s) of the Company
"Group" the Company and its subsidiaries
"HK$" Hong Kong dollars, the lawful currency of Hong Kong
"Hong Kong" the Hong Kong Special Administrative Region of the People's
Republic of China
"Listing Rules" the Rules Governing the Listing of Securities on the Stock
Exchange
"New Concept" New Concept Capital Limited, a company incorporated in the British Virgin Islands with limited liability, and a wholly-owned subsidiary of the Company
"Properties" collectively, the Warehouse, Carpark A and Carpark B
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"Purchaser A" Multi Lines International (Properties) Limited, a company incorporated in Hong Kong with limited liability
"Purchaser B" MTL International (Properties) Limited, a company incorporated in
Hong Kong with limited liability
"Shareholder(s)" holder(s) of the share(s) in the share capital of the Company
"Stock Exchange" The Stock Exchange of Hong Kong Limited
"Warehouse" the warehouses located at Units 1-20, 8th Floor, Hope Sea
Industrial Centre, No.26 Lam Hing Street, Kowloon, Hong Kong
"Warehouse Completion" the completion of the Warehouse Disposal
"Warehouse Consideration" the total consideration for the Warehouse Disposal payable by
Purchaser A to New Concept
"Warehouse Disposal" the disposal of the Warehouse by New Concept
"Warehouse Provisional
Agreement"
the provisional sale and purchase agreement dated 24 February
2014 and entered into between Purchaser A and New Concept in respect of the Warehouse Disposal
By order of the Board
Hong Kong, 24 February 2014
As at the date of this announcement, the Board comprises three executive Directors, Dr. Hon. So Yuk Kwan (Chairman), Mr. So Chi On and Mr. Ho Choi Yan Christopher and three independent non- executive Directors, Dr. Lui Ming Wah, SBS, JP, Mr. Charles E. Chapman and Mr. Wong Ka Kit.
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