International Business Settlement : CONNECTED TRANSACTION IN RELATION TO THE DISPOSAL OF 90% EQUITY INTEREST IN A SUBSIDIARY

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INTERNATIONAL BUSINESS SETTLEMENT HOLDINGS LIMITED

國 際 商 業 結 算 控 股 有 限 公 司

(Incorporated in Bermuda with limited liability)

(Stock Code: 00147)

CONNECTED TRANSACTION

IN RELATION TO

THE DISPOSAL OF 90% EQUITY INTEREST IN A SUBSIDIARY

THE DISPOSAL AGREEMENT

The Board is pleased to announce that after trading hours of the Stock Exchange on 14 May 2021, the Vendor (an indirect wholly-owned subsidiary of the Company) and the Purchaser entered into the Disposal Agreement pursuant to which the Vendor agreed to sell and the Purchaser agreed to purchase the Sale Shares, representing 90% of the issued share capital of the Target Company, for a consideration of US$3 million (equivalent to approximately HK$23.4 million) (subject to downward adjustment).

LISTING RULES IMPLICATIONS

As at the date of this announcement, the Purchaser holds 10% equity interest in the Target Company (of which the Company indirectly holds 90%) and accordingly is its substantial shareholder. The Purchaser is a connected person of the Company at the subsidiary level. Accordingly, the Disposal constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules.

As certain of the applicable percentage ratios in relation to the Disposal is more than 0.1% but less than 5%, the entering into of the Disposal Agreement and the transactions contemplated are subject to the reporting and announcement requirements but is exempted from the circular (including independent financial advice) and shareholders' approval requirement for the Company under Chapter 14A of the Listing Rules.

By virtue of Rule 14A.101 of the Listing Rules, since (1) the Purchaser is a connected person at the subsidiary level, (2) the Board has approved the Disposal; and (3) the independent non-executive Directors have confirmed that the terms of the Disposal are fair and reasonable and the Disposal is on normal commercial terms or better and in the interests of the Company and the Shareholders as a whole, the Disposal is subject to the reporting and announcement requirements, and is exempt from the circular, independent financial advice and independent shareholders' approval requirements under Chapter 14A of the Listing Rules.

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INTRODUCTION

The Board is pleased to announce that after trading hours of the Stock Exchange on 14 May 2021, the Vendor (an indirect wholly-owned subsidiary of the Company) and the Purchaser entered into the Disposal Agreement pursuant to which the Vendor agreed to sell and the Purchaser agreed to purchase the Sale Shares, representing 90% of the issued share capital of the Target Company, for a consideration of US$3 million (equivalent to approximately HK$23.4 million) (subject to downward adjustment).

The principal terms of the Disposal Agreement are set out below:

THE DISPOSAL AGREEMENT

Date
14 May 2021
Parties
Vendor:	Pride Delight Limited, an indirect wholly-owned subsidiary of the
	Company; and
Purchaser:	Vintage Gold Management Limited.

The Vendor is a company incorporated in the BVI on 19 May 2009 and is primarily engaged in investment holding.

The Purchaser is a company incorporated in the BVI on 28 July 2009 and is primarily engaged in investment holding.

Assets to be disposed of

The assets to be disposed of under the Disposal Agreement are the Sale Shares, being 90% of the issued shares of the Target Company on the Closing Date. The Sale Shares shall be acquired by the Purchaser together with all rights, title and interest attached thereto as of the Closing Date free of encumbrances.

Consideration

The consideration for the Sale Shares is US$3 million.

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Basis of Consideration

The Consideration was determined after arm's length negotiations between the Vendor and the Purchaser after taking into account, among other things, (i) the valuation of the Sale Shares as at 31 December 2020; and (ii) the book value of the Sale Shares since 2015.

Taking into account of the resources, the financial position and focus of the Group, the Directors are of the view that the Consideration is fair and reasonable and on normal commercial terms and are in the interests of the Company and the Shareholders as a whole.

Closing

Closing shall take place within five (5) Business Days on the date of signing in Hong Kong or at such other time and place as the Seller and the Purchaser mutually agreed upon, orally or in writing.

Upon Closing, the Target Company will be wholly owned by the Purchaser and will cease to be a subsidiary of the Company.

INFORMATION ON THE VENDOR, THE TARGET COMPANY AND PARTIES INVOLVED

The Vendor is an investment holding company and the Group is principally engaged in the development of properties, hotel business, provision of international business settlement services, provision of financing services and manufacturing and sales of disposable contact lens business.

The Target Company is a limited liability company incorporated in the BVI, and is a non-wholly owned subsidiary of the Vendor and is held as to 90% by the Vendor and 10% by the Purchaser. The Target Company holds 30% interests in each of Fastmind and Acme Day. Fastmind is a limited liability company incorporated in Hong Kong, and holds 99% interest in Tunlin. Acme Day is a limited liability company incorporated in Hong Kong, and holds 1% interest in Tunlin. Tunlin is a company incorporated in the Kyrgyz Republic and is the sole owner of all the shares of the Project Company. The Project Company is a close joint stock company registered and existing under the laws of Kyrgyz Republic and the holder of the Mining License for the Mine.

The Purchaser is a limited liability company incorporated in the BVI and is held as to 100% by Mr. Zheng Qiang.

The Mine is located in the Chatkal region, Jalalabat oblast, Southwest of the Kyrgyz Republic with estimated mineral resources of approximately 97.0 tonnes of gold and approximately 1.0 million tonnes of copper. The Mining License had been issued by the relevant authorities of Kyrgyzstan's Government with a mining period extended to December 2041.

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Set out below are the financial information extracted from the unaudited management accounts of the Target Company for the year ended 31 March 2020 and 2021:

The Target Company
	For the	For the
	year ended	year ended
	31 March	31 March
	2020	2021
	HK$	HK$
	(unaudited)	(unaudited)
Net loss for the year	12,262	15,650
		As at
		31 March
		2021
		HK$
		(unaudited)
Deficiency of equity		694,810

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SHAREHOLDING STRUCTURE OF THE TARGET COMPANY BEFORE AND AFTER CLOSING

Set out below is the shareholding structure of the Target Company immediately before and after Closing:

As at the date of this announcement and

immediately before Closing

						The Company
						(Bermuda)
							100%
						Successtime
						(BVI)
							100%
Purchaser					Vendor
(BVI)					(BVI)
10%							90%
		The Target Company
			(BVI)
30%						30%
Fastmind					Acme Day
(HK)					(HK)
99%							1%
			Tunlin
			(Kyrgyzstan)
				100%
		The Project Company
			(Kyrgyzstan)

Immediately after Closing

Purchaser

(BVI)

100%

The Target Company

(BVI)

30%							30%
Fastmind				Acme Day
(HK)				(HK)
99%							1%

Tunlin

(Kyrgyzstan)

100%

The Project Company

(Kyrgyzstan)

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