Tem Fat Hing Fung gets $253.25m for jewellery business sale to subsidiary

Property developer Tem Fat Hing Fung (Holdings) yesterday announced the sale of its jewellery businesses to a subsidiary, RNA Holdings, for $253.25 million.

RNA Holdings, a gold trader, will pay $190.73 million in cash.

The balance will come through an issue of 83.8 million new shares at 76.4 cents each - a premium of 6.57 per cent to RNA's closing price of 70 cents on Friday.

The sale was based on a prospective price multiple of 6.5 times $17.5 million - the guaranteed audited consolidated net profit of the jewellery business for the year to December 1998.

Tem Fat's holding in RNA will increase to 51.84 per cent after the deal, up from 46.87 per cent.

Tem Fat said it planned to use the net proceeds of $188 million to explore new projects.