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| Official Debut in the Greater Bay Area Upstream and Downstream Supply Chain Businesses, Broadening Revenue Stream and Customer Base |
HONG KONG, Nov 7, 2022 - (ACN Newswire) - China Wantian Holdings Limited ("China Wantian Holdings", together with its subsidiaries, the "Group"; stock code: 1854.HK) is pleased to announce that Great Point Limited ("Great Point"), the Group's direct wholly-owned subsidiary, intends to acquire Champion Point Limited ("Champion Point")'s subsidiary Shenzhen Wealth Source Trading Development Company Limited* ("Shenzhen Wealth Source", together with Champion Point, the "Target Group"), which is a domestic fresh food supply chain service provider in the PRC. It marks the Group's expansion of its fresh food ingredient business into the Guangdong-Hong Kong-Macao Greater Bay Area (the "Greater Bay Area") market.
The total consideration of the acquisition is HK$44.0 million and will be settled by China Wantian Holdings' allotment and issue of up to 91,660,000 consideration shares at the issue price of HK$0.48 per consideration share. The consideration shares represent approximately 5.96% of the issued share capital of the Group as at 7 November 2022 and approximately 5.62% of the issued share capital of the Group as enlarged by the allotment and issue of the consideration shares (assuming there will be no change in the total number of issued shares between 7 November 2022 and the allotment and issue of the consideration shares). The allotment and issue of the consideration shares will be made pursuant to the general mandate, and hence is not subject to the Shareholders' approval.
Acquisition completion is subject to the fulfilment of conditions, including Great Point having completed and being satisfied with the results of its due diligence review on the sale shares and the Target Group. Meanwhile, according to the share purchase agreement, 91,660,000 consideration shares will be allotted and issued in three tranches in accordance with the profit conditions agreed between the parties. The first, second and third tranche consideration shares will be approximately 9,160,000 consideration shares, 27,490,000 consideration shares and 55,010,000 consideration shares respectively. Among which, the second and third tranche consideration shares will be allotted and issued when the audited net profit after tax (excluding any extraordinary or exceptional profit) for the year ending 31 March 2023 and 2024 of Shenzhen Wealth Source are not less than 85% of target net profits (RMB5.45 million and RMB7.50 million representatively). Upon the acquisition completion, the Target Group will become wholly-owned subsidiaries of China Wantian Holdings and their financial results will be consolidated into China Wantian Holdings' consolidated financial statements.
In May 2022, the Group established its Greater Bay Area headquarters in Shenzhen, marking its official debut in the high-potential Greater Bay Area market. The Group will expand its existing business into the Greater Bay Area market, which has a large consumer base, and related downstream businesses, meanwhile stepping up its efforts to develop the three key businesses including supply chain and catering, as well as environmental protection and technology. Taking into account the adverse impact brought about by the outbreak of COVID-19 on the catering and corresponding food processing industries in Hong Kong, the Group's management believes that the Group can remain competitive by venturing into new markets and diversifying its business development strategies, thus generating higher returns for investors and shareholders.
The Target Group which the Group proposes to acquire is principally engaged in the trading of live cattle, fruits, vegetables, seafoods and food ingredients in the PRC. Shenzhen Wealth Source is the operating subsidiary of the Target Group. It sources live cattle from Inner Mongolia and distributes them to slaughterhouses in the Greater Bay Area. It also supplies and offers fruits, vegetables and seafood to restaurants in the Greater Bay Area. Acquiring Champion Point with well-established business network and customer base in the PRC will allow the Group to offer comprehensive service packages to the customers and broaden customer base. Therefore, China Wantian Holdings' management believes that the acquisition is an ideal business opportunity for the Group to expand its existing supply chain business operation in Hong Kong to the Greater Bay Area market, adding that the target net profits of Shenzhen Wealth Source are promising in the next two years, the acquisition is poised to broaden China Wantian Holdings' revenue stream, thus contributing stable income in the future.
* The English name is not the official name and is translated for reference purpose only.
About China Wantian Holdings Limited
China Wantian Holdings Limited (1854.HK) is an investment holding company. The Group is principally engaged in sourcing, processing and supplying food ingredients, with a focus on the provision of vegetables and fruit to food service operators in Hong Kong. It supplies in excess of 1,300 food ingredients to more than 480 customers. In May 2022, China Wantian Holdings established its Greater Bay Area headquarters in Shenzhen, marking its official debut in the Greater Bay Area market. The Group will focus on developing three main businesses in this market, including supply chain and catering, as well as environmental protection and technology to actively establish a leading green brand in the Greater Bay Area to provide customers with fresh, healthy and safe food.
For more details, please visit: chinawantian.etnet.com.hk
Topic: Press release summary
Source: China Wantian Holdings Limited
Sectors: Food & Beverage
https://www.acnnewswire.com
From the Asia Corporate News Network
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