Investment to Support Continued Expansion of Company's Integrated Logistics and Trade Centre Business in China
HONG KONG, April 2, 2013 /PRNewswire/ -- China South City Holdings Limited("China South City" or "the Company"; SEHK stock code: 1668) and its subsidiaries (the "Group"), one of the leading developers and operators of large-scale, integrated logistics and trade centers in China, today announced that on 28 March 2013, PAG has made a strategic investment in China South City. PAG is one of the leading alternative investment fund management groups in Asia with extensive experience in investing in the region's capital markets and property sectors.
The investment by PAG will be in the form of convertible notes. According to the purchase agreement, PAG, through its Pacific Alliance Asia Opportunity Fund L.P., will purchase HK$975 million in convertible notes at a conversion price of HK$1.56 per new share from the Company. Assuming full conversion of the 625 million new shares in the Company, the notes represent approximately 10.32% and 9.35% of the issued and enlarged capital of the Company, respectively. The convertible notes bear interest at a rate of 6.5% per annum, and will mature in April 2018.
Mr. Ricky Cheng Chung Hing, Co-Chairman and Executive Director of China South City said, "We are pleased to welcome PAG as our strategic investor. The investment is a strong vote of confidence in our business model and future potential, and supports our continuous robust growth and expansion plan. We appreciate PAG's strategic view of China South City and believe they will be a valuable partner as we aggressively pursue our strategy."
Mr. Eddie Hui, Managing Partner of PAG, said, "China South City is uniquely positioned to take advantage of the growth potential in China's booming logistics and trade centre sector fueled by China's latest drive towards urbanization. We have every confidence that China South City is the right company to seize these opportunities. We share the vision of the Company, and their value proposition is compelling. We look forward to utilizing our expertise in different areas to work with the management team to further grow the business."
The Company intends to use the net proceeds of approximately HK$970 million to fund the Group's properties under development and to refinance a portion of the Group's existing debt. With a strengthened capital base, the Group will continue to explore potential investments to expand its footprint in China's integrated logistics and trade centre business.
About China South City Holdings Limited (SEHK: 1668)
China South City Holdings Limited, along with its subsidiaries ("the Group"), is one of the leading developers and operators of large-scale integrated logistics and trade centers in China. The Group provides a comprehensive trading platform for domestic and international wholesale suppliers, buyers, manufacturers, distributors and end-users of products ranging from raw materials to finished products. With its unique business model, the Group not only sells and leases well-designed quality trade center units for businesses to display and sell their products, but also provides to occupants and their clients one-stop convenient supply chain solutions that include a full range of facilities and services. Moreover, to exhibit the value of its unique "One Body with Two Wings" business model, five pillars of ancillary services, namely one-stop warehousing and logistics services, convention and exhibition services, outlet operation and management, e-commerce platform and property management have been included in each of our projects to complement the core business of trade center development and operation. This successful and proven business model was pioneered by China South City Shenzhen and has been replicated in strategic locations across China such as Nanchang, Xi'an, Nanning, Harbin and Zhengzhou to satisfy the needs of businesses and industries in their respective regions. The Company's stock has been listed on the Main Board of The Stock Exchange of Hong Kong Limited since 30 September 2009 under stock code 1668.
About PAG
Founded in 2002, PAG is one of the region's largest Asia-focused investment managers with funds under management across Private Equity, Real Estate and Absolute Return strategies. PAG has over 290 staff across offices including Hong Kong, Shanghai, Beijing and Tokyo, etc.
For further enquiries, please contact Hill+Knowlton Strategies Asia:
Lucinda Mao
Tel: (852) 2894 6254 / 5174 3000
Email: lucinda.mao@hkstrategies.com
Candy Chan
Tel: (852) 2894 6246/ 9715 8681
Email: candy.chan@hkstrategies.com