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Human Health Holdings Limited
盈健醫療集團有限公司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 1419)
VOLUNTARY ANNOUNCEMENT
UPDATE ON DISCLOSEABLE TRANSACTION
IN RELATION TO
TERMINATION OF THE BUSINESS ALLIANCE
IN
HEALS HEALTHCARE (ASIA) LIMITED
INTRODUCTION
Reference is made to the announcements issued by the Company on 7 October 2020 and 23 October 2020 (the "Announcements") in relation to the entering into the deed of termination to the Business Alliance Agreement and the Subscription Agreement (the "Deed of Termination") to (i) terminate the Business Alliance Agreement and the Subscription Agreement on the date of the Deed of Termination; and (ii) set out the disposal arrangements of the Consideration Shares and the First Tranche Subscription Shares following the termination of such agreements. Unless otherwise stated, capitalised terms and expressions used herein shall have the same meanings as those defined in the Announcements.
This announcement is made by the Company on a voluntary basis on the update of the arrangements of the Consideration Shares and the First Tranche Subscription Shares pursuant to the Deed of Termination.
COMPLETION OF THE CONSIDERATION SHARE SALE
The Company wishes to announce that, the sale of all Consideration Shares at the 2nd Designated Price took place before the Extended Closing Date, however the Subscription Share Sale was not procured before the Extended Closing Date. As such, the parties adopted arrangement in accordance with the Deed of Termination to the First Tranche Subscription Shares (details of which are set out in the paragraph headed "In case procurement of the Consideration Share Sale takes place earlier than the procurement of the Subscription Share Sale" in the announcement of the Company dated 7 October 2020 ).
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THE SHARE PURCHASE
According to the Deed of Termination, within 60 days after the completion of the Consideration Share Sale (which can be extended by another 40 days), the Target Company or another entity nominated by the Target Company is required to fully utilise and directly apply the Sale Proceeds of Consideration Shares to purchase the maximum number of the First Tranche Subscription Shares held by the Subscriber at HK$200 per share of the Target Company (the "Share Purchase") and the Escrow Agent shall apply the Sale Proceeds of Consideration Shares to such purchase accordingly.
Accordingly, on 3 May 2021, the Subscriber (as vendor), Heals Treasury Company Limited (the "Purchaser") (as purchaser) and the Target Company entered into a sale and purchase agreement (the "Sale and Purchase Agreement") in relation to the 51,804 shares of the Target Company held by the Subscriber (the "Sale Shares").
Details of the Sale and Purchase Agreement are set out as follows:
Date: | 3 May 2021 | |
Parties: | (1) | the Subscriber as vendor; |
(2) | the Purchaser as purchaser; and | |
(3) | the Target Company as company. |
To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, the Purchaser and the Target Company and their respective ultimate beneficial owner are third parties independent of the Company and connected persons of the Company.
Subject Matter
Pursuant to the Sale and Purchase Agreement, the Subscriber shall sell, and the Purchaser shall acquire the Sale Shares at a consideration of HK$10,360,800.
Consideration
HK$10,360,800, being the consideration for the maximum number of First Tranche Subscription Shares at HK$200 per share of the Target Company by utilising the Sale Proceeds of the Consideration Shares, is determined in accordance with the terms of the Deed of Termination.
The Sale Proceeds of the Consideration Shares shall be applied as the consideration and the consideration shall be released by the Escrow Agent to the Subscriber at completion of the Sale and Purchase Agreement.
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Completion
Completion took place on the date of the Sale and Purchase Agreement. Immediately following the Share Purchase, the Subscriber will remain as a minority shareholder holding 104,863 shares of the Target Company.
INFORMATION ON THE TARGET COMPANY AND THE PURCHASER
The Target Company
The Target Company is a company incorporated in Hong Kong with limited liability on 1 November 2017. As at the date of this announcement, the Target Group is the holding company of several subsidiaries incorporated in Hong Kong which are principally engaged in the provision of various digital healthcare platform services. As at the date of this announcement, the single largest shareholder of the Target Company is Heals Healthcare Platform Limited holding approximately 37.3% of the issued shares of the Target Company. Based on the register of members of Heals Healthcare Platform Limited, its sole shareholder is Mr. Cheng Chi Heng.
The Purchaser
The Purchaser is a company incorporated in Hong Kong with limited liability on 1 March 2021. As at the date of this announcement, it is a wholly owned subsidiary of Heals Healthcare Platform Limited, the single largest shareholder of the Target Company.
FINANCIAL EFFECT OF THE SHARE PURCHASE
Immediately after the completion of the Share Purchase, after taking into account (i) the Sales Proceeds of Consideration Shares of approximately HK$10.4 million; (ii) the Sales Proceeds of Consideration Shares was used to purchase 51,804 shares of the Target Company held by the Subscriber and the Subscriber will remain as a holder of 104,863 shares of the Target Company after the Share Purchase; and assuming that (iii) the fair value of the 51,804 shares of the Target Company is calculated proportionately based on the fair value of the investment in the Target Company as at the date of completion of the Share Purchase; and (iv) the fair value of the investment in the Target Company on the date of completion of the Share Purchase remains the same as that of approximately HK$12.1 million as at 31 December 2020, it is expected that the Share Purchase will give rise to a gain of approximately HK$6.4 million for the Group. In addition, the fair value of the 104,863 shares of the Target Company held by the Subscriber is subject to valuation to be conducted as at 30 June 2021.
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The exact amount of the profit or loss arising from the termination of the Business Alliance Agreement and Subscription Agreement and the Share Purchase to be recorded in the consolidated statement of profit or loss and other comprehensive income of the Group for the year ending 30 June 2021 is subject to review and audit by the auditor of the Company.
By Order of the Board
Human Health Holdings Limited
Chan Kin Ping
Chairman
Hong Kong, 3 May 2021
As at the date of this announcement, the Board comprises Mr. Chan Kin Ping, JP (also as Chief Executive Officer), Dr. Pang Lai Sheung, Dr. Sat Chui Wan and Mr. Poon Chun Pong as executive Directors and Dr. Lui Sun Wing, Mr. Chan Yue Kwong Michael and Mr. Sin Kar Tim as independent non-executive Directors.
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