Sunglass maker to sell Shenzhen factory site for 1.8b yuan
Sunglasses maker Arts Optical International has agreed to sell the site of its Shenzhen factories to a subsidiary of Hong Kong-listed property developer Kaisa for 1.8 billion yuan (HK$2.27 billion).
The deal would provide a gain of 791.6 million yuan for the company but means it will have to relocate its Shenzhen factories next year. The deal requires shareholder approval because it is a substantial disposal.
The company's factories are now located in an area that is part of the Shenzhen government's urban renewal project. It said the relocation of the outdated factories as a result of the sale would pave the way for the area's redevelopment.
Arts Optical said in an announcement posted on the Hong Kong stock exchange's website yesterday that subsidiary Argent had agreed on August 15 to sell the Argent Urban Renewal Project, a total area of 59,701 square metres, including related land use and redevelopment rights, to Kaisa Property. The deal also includes the sale of four small plots of residential land, covering a combined 1,495 square metres, owned by Arts Optical chairman Michael Ng Hoi-ying, director Ng Kim-ying and two senior executives, Li Chi-hung and Hung Chao-chia.
Arts Optical said its production facilities had been in use for 30 years and the deal provided a good opportunity for it to upgrade and modernise its production facilities in new factories in Heyuan and Pingdi in Shenzhen.
The group said it expected to hand the site of its current factories to Kaisa Property in the second half of next year.
"The board considers the transactions to be an important opportunity for the group to capitalise on its investment gain and to finance the relocation of its manufacturing facilities," it said in the announcement.