Company claims $2m oversight

KWONG Sang Hong International announced last night that its subsidiary made about $2 million profit from a Philippines property deal but failed to report the connected transaction, which took place in February, due to an 'internal oversight'.

The company said in a statement that it 'apologises for the delay' and that the company directors, including independent non-executive directors, considered the terms of the agreement fair and reasonable and on normal commercial terms.

On February 14, Peregrine Securities Philippines (PSP) and Kwong Sang Hong International's wholly-owned subsidiary, Kwong Sang Hong Philippines (KSHP) signed an agreement to transfer the obligations of KSHP as purchaser of the property from a third party to PSP.

Peregrine agreed to pay KSHP HK$17.65 million which it had paid to the developer of the property, and another HK$1.36 million, which represents the difference between the contractual purchase price of the property and the results of an independent valuation of the property conducted on Tuesday .

Peregrine is to pay KSHP interest of about 2.7 million pesos (about HK$802,979) calculated at 10 per cent per annum on payments made by KSHP to the developer.

The unnamed developer consented to the transfer of rights between KSHP, a property holding company in the Philippines, and Peregrine.