International Finance Corp Invests HKD116 Mln in CENTURY SUNSHINE

century_crops1.14Century Sunshine's green fertilizers help tea, fruit and peanut farmers, and many others, achieve a bountiful harvest.  Photos: e-chinatea, pconline, ymt360Century Sunshine Group (HK: 509)  entered into a share subscription agreement on Jan. 28 with the International Finance Corp (IFC) -- a member of the World Bank Group -- whereby the latter will subscribe for 115,077,000 shares at 0.75 hkd per share.

This is a 5% discount to the three-month volume weighted average trading price prior to 16 January 2014.

Century Sunshine last traded on Jan. 28 at 0.84 hkd.

The gross proceeds raised are approximately 116 million hkd and will be used as general working capital of Century Sunshine.

The IFC subscription represents around 5.63% of the enlarged issued share capital.

“After a six-month thorough onsite due-diligence conducted by metals specialists, chemists, environmental experts and other professionals of IFC,
 they have given us high credentials on the prospects of both ecological fertilizers and magnesium businesses,” said Century Sunshine Chairman and CEO Mr. Chi Wen Fu.

He added that Century Sunshine has thus not only built a stronger shareholder base with a world-class investment institution, but once again earned the recognition of IFC for its new material development which demonstrates the growing value of the company.

Robust 1H2013 Results

Century Sunshine boosted its 1H2013 top line 31% year-on-year to 714.3 million hkd, leading to a 90% surge in net profit to 86.9 million.

In the January-September period, the firm’s rare earth magnesium alloy sales by volume shot up 82% year-on-year to 6,236 tonnes while organic fertilizer sales rose 44% to 93,854 tonnes.

These numbers bode well for full-year 2013 earnings.

“We expect to report fast top and bottom line growth for 2013,” Century Sunshine Executive Director Mr. George Yang told investors in Shenzhen on Jan. 10.

Century Sunshine is engaged in diverse yet vertically integrated business activities including R&D, production and distribution of magnesium alloys and ecological fertilizers. The Group was listed on Hong Kong’s GEM Board on 17 February 2004 and was transferred to the Main Board on 1 August 2008.


SHENZHEN INVESTMENT Buys 5.6 Bln Yuan Asset from Parent

Shenzhen Investment Ltd (HK: 604)
 has agreed to purchase Shenzhen Bio-Agriculture Company Ltd from its controlling shareholder -- Shum Yip Holdings Company Ltd -- for 5.623 billion yuan.  

This follows on another similar major acquisition that Shenzhen Investment made early in 2013 from Shum Yip Holdings for 4.15 billiion yuan (more on this below).

ShenzhenInv_LuHua1.14Dr Lu Hua is chairman of Shenzhen Investment as well as chairman of its controlling shareholder, Shum Yip Holdings. In early 2013, the latter had injected assets into the former, a Hong Kong-listco.
Photo: Annual report
As for the latest purchase, half of the payment will be settled by the issue of 1.1 billion Shenzhen Investment shares at 3.286 hkd per share, representing a 21.7% premium to its Jan. 27 closing price of 2.7 hkd.

Upon completion of the transaction, the shareholding of Shum Yip in Shenzhen Investment will increase to 67.27% from 60.59% currently.

Shenzhen Bio-Agriculture Company Ltd (the Target Group), through subsidiaries, owns and operates 12 property development projects and holds properties (including the Mingren Land) in Shenzhen for investment.

The total GFA of these properties is approximately 384,775 sq m

The principal property of the acquired assets is Mingren Land -- located in Futian District, Shenzhen -- with a total land area of approximately 39,158 sq m and an expected total planned GFA of approximately 259,332 sq m

Shenzhen Bio-Agriculture Company is engaged in property development and investment, property management, garden design and construction, manufacture and sale of agricultural products.

Upon completion:

(i) HK$3,614,380,054.87 (equivalent to approximately RMB2,811,500,000), or 50% of the consideration before any adjustment, shall be satisfied by Shenzhen Investment issuing 1,099,933,066 shares to 
Shum Yip Holdings Company Ltd; and

(ii) HK$3,073,673,169.84 (equivalent to approximately RMB2,390,903,000) shall be satisfied by Shenzhen Investment in cash.

The balance of the consideration of HK$540,706,885.29 (equivalent to RMB420,597,000), if payable, shall be paid at such time after completion.

Upon completion, Shenzhen Bio-Agriculture and its subsidiaries will become subsidiaries of Shenzhen Investment and the financial results will be consolidated into the Group.

Based on the unaudited consolidated financial information of Shenzhen Bio-Agriculture for the year ended 31 December 2013, the property investment and development division and the property management division accounted for approximately 94.9% of total segment revenue and 98.6% of total segment assets, respectively, as at 31 December 2013.

szinv_1H2013For the year ended 31 December 2013, Shenzhen Bio-Agriculture’s profit before taxation and extraordinary items stood at 1.64 billion hkd versus 918.6 million in the year-earlier period.

For the same year, 
Shenzhen Bio-Agriculture’s profit after taxation and extraordinary items stood at 965.4 million hkd compared to 492.6 million a year prior.

The unaudited consolidated net asset value attributable to owners of Shenzhen Bio-Agriculture as at 31 December 2013 was 3.77 billion hkd.

As some of the applicable percentage ratios for the acquisition exceed 25% but all of them are less than 100%, the acquisition constitutes a major transaction of Shenzhen Investment and is subject to the reporting, announcement and shareholders’ approval requirements.

SZ_homeprices1.14Source: Wind

Kezhigu project bought for RMB4.15 billion

In early 2013, Shenzhen Investment acquired 100% stake of the Kezhigu project from Shum Yip Holdings for RMB 4.15bn, with a 11.5% discount to valuation.

The consideration was paid by the issue of 1.4bn shares to Shum Yip at HK$3.667 a share, which was a 9.1% premium to the closing  price of HK$3.36 on the date of agreement.    

The project sits on prime land in Futian District only 5 minutes  away from the CBD.

The project has land area of 121,225 sqm and GFA of 788,910 sqm, and will comprise luxury apartments, an office tower, hotels and a shopping mall.

See also:

CENTURY SUNSHINE Sees Fertile Profit Potential In China

SHENZHEN INVESTMENT Targets Doubling Sales In 2015

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