LAI SUN GARMENT (INTERNATIONAL) LIMITED Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this joint announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this joint announcement.
This joint announcement appears for information purposes only and does not constitute an invitation or offer to sell, dispose, acquire, purchase or subscribe for any securities of LSD and neither this joint announcement nor anything herein forms the basis for any contract or commitment whatsoever.
Distribution of this joint announcement into jurisdictions other than Hong Kong may be restricted by law. Persons who come into possession of this joint announcement should acquaint themselves with and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
This joint announcement is not an invitation or offer of securities for sale in the United States and neither this joint announcement nor any copy thereof may be released or distributed in the United States or any other jurisdiction where such release might be unlawful or to any US Persons. Securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act of 1933 of the United States, as amended.
(Stock Code: 488)
JOINT ANNOUNCEMENT- PROPOSED RIGHTS ISSUE ON THE BASIS OF 1 RIGHTS SHARE FOR EVERY 2 EXISTING SHARES HELD ON THE RECORD DATE
- CONNECTED TRANSACTION TO PAY UNDERWRITING COMMISSION AND
- CLOSURE OF REGISTER OF MEMBERS
LSD proposes to raise approximately HK$924.3 million before expenses by way of a rights issue.
Pursuant to the Rights Issue, the Qualifying Shareholders will be provisionally allotted 1 Rights Share in nil-paid form for every 2 existing LSD Shares held on the Record Date. The Subscription Price has been set at HK$0.092 per Rights Share. Fractional entitlements will not be allotted but will be aggregated and sold for the benefit of LSD. The Rights Issue will not be available to the Non-Qualifying Shareholders.
The Rights Issue will be fully underwritten by LSG, whose commitment also extends to subscribing or procuring the subscription of the Committed Shares. LSG's obligations under the Underwriting Agreement (inclusive of its commitment in respect of the Committed Shares) represent a major transaction for LSG. The Rights Issue is, accordingly, conditional upon LSG obtaining the requisite approval of its shareholders in general meeting in respect of the Proposed Subscription.
Assuming that LSG obtains the requisite approval of its shareholders in general meeting in respect of the Proposed Subscription, the last day of dealings in the LSD Shares on a cum-rights basis is expected to be Monday, 11 January 2016. The LSD Shares will be dealt with on an ex-rights basis from Tuesday, 12 January 2016. The Rights Shares are expected to be dealt with in their nil-paid form from Wednesday, 20 January 2016 to Wednesday, 27 January 2016 (both days inclusive).
To qualify for the Rights Issue, a LSD Shareholder must be registered as a member of LSD as at 5:00 p.m. on the Record Date, which is currently expected to be Friday, 15 January 2016. In order to be registered as members of LSD at 5:00 p.m. on the Record Date, all transfer documents of the LSD Shares (together with the relevant share certificates) must be lodged for registration with the Registrar at Level 22, Hopewell Centre, 183 Queen's Road East, Hong Kong, by 4:30 p.m. on Wednesday, 13 January 2016. The register of members of LSD will be closed on Thursday, 14 January 2016 and Friday, 15 January 2016.
The Latest Acceptance Date is expected to be on Monday, 1 February 2016 or such other date as LSD and the Underwriter may agree in writing. LSD will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares in both their nil-paid and fully-paid forms. For details of the trading arrangements, please refer to the section headed 'Expected Timetable' below.
LSG, the controlling shareholder of LSD, has, directly and indirectly (through the LSG Subsidiaries) an aggregate shareholding of approximately 51.88% of the issued share capital of LSD as at the date of this joint announcement. The Proposed Subscription, comprising as it does, the obligation of LSG and the LSG Subsidiaries to subscribe both the Committed Shares and the Underwritten Shares represents the acquisition of a further interest in LSD constituting a major transaction for LSG. In the absence of interest in the Rights Issue on the part of other Qualifying Shareholders, LSG's interest in LSD could increase to a maximum of approximately 67.92% of LSD.
It is currently expected that the circular of LSG relating to the Proposed Subscription and giving notice of the LSG GM will be despatched by LSG to LSG Shareholders on or before Friday, 11 December 2015, which is more than 15 Business Days after the publication of this joint announcement, as LSG requires more time to prepare the information to be included in the circular, including the financial information.
Assuming LSG obtains the requisite approval of its shareholders in general meeting in respect of the Proposed Subscription, the Prospectus containing, among other things, further details of the Rights Issue is expected to be despatched by LSD to the Qualifying Shareholders and for information only, to the Non-Qualifying Shareholders on the Posting Date. The PALs and the EAFs will also be sent to the Qualifying Shareholders on the same date.
PROPOSED RIGHTS ISSUELSD proposes to raise funds by way of Rights Issue, the principal terms of which are set out below. The Rights Issue is conditional, as explained below in the section headed 'Conditions to the Rights Issue and the Underwriting Agreement'.
Basis of the Rights Issue: 1 Rights Share for every 2 existing LSD Shares held at 5:00 p.m. on the Record Date
Subscription Price: HK$0.092 per Rights Share Number of the existing LSD Shares in issue: 20,094,533,563
Number of Rights Shares: 10,047,266,781
Underwriter: LSG
Under the Rights Issue, the 10,047,266,781 nil-paid Rights Shares proposed to be provisionally allotted represent approximately 50.00% of the existing issued share capital of LSD and approximately 33.33% of the issued share capital of LSD as enlarged by the Rights Issue.
It should be noted that:
as at the date of this joint announcement, there are outstanding options to subscribe a total of 713,823,903 LSD Shares; and
the LSD Directors have recommended the payment of a final dividend of HK0.25 cent per share, amounting to HK$50,236,334 for LSD's financial year ended 31 July 2015, to LSD Shareholders whose names appear on the register of members of LSD on Tuesday, 22 December 2015, subject to the approval of LSD Shareholders at Friday, 11 December 2015 annual general meeting of LSD. The proposed dividend includes a scrip alternative, meaning that those on the register as at that record date can elect to receive some or all of the dividend in the form of new LSD Shares.
Taking into account the possibility that all of the options referred to (i) above might be exercised before the Record Date; and the further possibility that the entire dividend referred to in (ii) above could, assuming LSD Shareholders' approval is forthcoming, be required to be settled in scrip (and assuming, for illustration purposes only, that the issue price for such scrip were to be the theoretical ex-rights price of approximately HK$0.123 per LSD Share based on the closing price of an LSD Share quoted on the Last Trading Day), LSD's issued shares of the Record Date could increase by approximately 1,122,249,382 shares to 21,216,782,945 shares in total. This would increase the number of Rights Shares by approximately 561,124,691, meaning that LSD would stand to derive additional proceeds of approximately HK$51.6 million, increasing LSG's underwriting commitment accordingly.
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