CONTINENTAL Holdings has reached a conditional agreement on a joint-venture jewellery factory in Wubei. The company intends to invest US$1.5 million in the factory through its subsidiary Larchridge with an independent third party, Delight Holdings, taking 10 per cent of Continental Wuhan, the company which formed the joint venture with Wubei Province Handicraft and Arts Factory, Wubei Continental. Continental Wuhan will receive 20 million 25-cent shares in Continental Holdings or two million 10-cent shares if Continental Holdings' proposed capital reduction programme goes ahead. Continental Wuhan will have a 60 per cent interest in Wubei Continental, which has a total investment requirement of $5 million with initial registered capital of $2.5 million. The company will have a five-storey factory with a usable floor area of 3,800 sq ft. Wubei Arts Factory made a profit of 850,000 yuan (about HK$753,100) before tax under China audit rules in the year to December 31, 1992, according to the company.
