ITC to proceed with Paul Y offer
Construction and investment company ITC's independent shareholders yesterday gave the green light for it to proceed with its proposal to acquire the remaining shares of its 42.59 per cent-owned subsidiary Paul Y-ITC Construction Holdings.
At yesterday's special general meeting, about 200 million shares were in favour of the proposal and about 250,000 against.
The result clears the way for the parent to take the first step in its acquisition plan.
Under the plan, ITC will make an offer to buy the remaining shares at 30 HK cents a piece.
The offer price represents a deep 89 per cent discount to the subsidiary's net asset value.
Yesterday's approval also means there is no need for Charles Chan Kwok-keung - chairman and ultimate controlling shareholder of ITC and Paul Y - to take ITC's place in offering to buy shares from Paul Y's minority shareholders himself.
Under the Companies Act of Bermuda, where Paul Y is domiciled, it would become compulsory for ITC to acquire the balance of the shares in Paul Y if more than 90 per cent of the shareholders respond to the offer - effectively privatising the subsidiary.
Tom Lau Ko-yuen, the deputy chairman of ITC, said yesterday that if such a privatisation was the case, the parent would then consider selling some of Paul Y's assets.
Proceeds from such asset disposals could be distributed to ITC's shareholders in the form of special dividends, Mr Lau said.
Meanwhile, Paul Y yesterday announced that the sale of a hotel-related asset was completed on Monday.
Paul Y disposed of the assets to China Land - a company 65.56 per cent owned by Hong Kong-listed China Strategic Holdings, in which Paul Y owns 14.55 per cent, for HK$250 million in cash.
