F&N, Ascendas and CyberCity join hands in consortium to take control of Hing Kong

Thursday, 11 January - F&N, through its wholly-owned subsidiary, Fraser & Neave Investments (Hong Kong) Limited, Ascendas and CyberCity, through their newly formed consortium, Vision Century, have signed a conditional sale and purchase agreement for the acquisition of 389,283,062 shares (representing about 23.3% of the total share capital in issue) in Hing ompany listed on the Stock Exchange of Hong Kong. The vendor is Winyear Profits Limited, a subsidiary of China Travel International Investments (CTII).

Hing Kong's business covers property development and investment in Hong Kong and the PRC, investments in IT projects and infrastructure, including the CyberCity Shenzhen science park.

The HK$389.3 million deal values Hing Kong at HK$1 per share, which represents a premium of 9.9 per cent. over the closing share price of HK$0.91 on 5 January 2001. This is a discount of 23.7 per cent to its net asset value (NAV) per share of HK$1.31 at 31 December 1999, and 9.9 per cent from its unaudited NAV of HK$1.11 at 30 September 2000.

Vision Century is a company incorporated in British Virgin Islands and will have a paid up capital of HK$1.25 billion. CyberCity currently owns 500 million Hing Kong shares (representing about 29.9%.), which will be transferred into Vision Century as contribution for its 40% stake. F&N and Ascendas will each inject cash of HK$375 million into Vision Century for their respective 30% stake.

The acquisition of the 23.3% Hing Kong stake by Vision Century is conditional upon satisfactory due diligence and will result in Vision Century gaining a majority control of Hing Kong with a 53.2% interest, if the acquisition is completed.

Said Dr. Simon X. Jiang, Founder and Chairman of CyberCity and Chairman of Vision Century, "Under the strategic direction of the three partners of Vision Century, Hing Kong will primarily focus on the development and management of science parks, IT facilities, with complementary and ancillary business in infrastructure related areas of high tech / IT / internet investments, e-business, and property development."

Hing Kong owns a 95% equity interest in CyberCity Shenzhen which is located in Shenzhen Hi-Tech Industrial Park, and is China's largest Science Park. The masterplan for the 5 million square feet science park was designed by the world renowned Pei Partnership Architects.

Phase 1 of CyberCity Shenzhen will be completed in the first quarter of 2001, and development plans for Phase 2 are currently underway. Through Hing Kong, Vision Century will proceed with the development and management of Phase 2.

More recently, Hing Kong also invested in 3 high-tech companies, including stakes in e-Cell Technologies, a US company in the business of designing and manufacture of broadband transmission systems; Maxwin, a software and internet products maker in Beijing; and Easynet, a Chinese language keyboard developer.

Vision Century's vision is to set up a network of branded science parks linked by a national optical fibre backbone. By leveraging on the complementary strengths of all three partners, it is well-positioned to tap related opportunities in internet and e-commerce, as well as in property development as the network of science parks takes shape in China:

- CyberCity has already signed MOUs with 11 emerging science parks in major Chinese cities. It has granted Hing Kong the first right of refusal to acquire the development rights it secured. It also owns the technology for real-time, high speed translation and localisation of English internet contents into Chinese, a strategic asset given the phenomenal growth in internet usage and the current lack of internet contents in Chinese. CyberCity is also developing internet data centers in Hong Kong, Beijing and Shanghai to deliver a range of hosting, e-commerce and related services.

CyberCity is also partnering with Temasek Holdings, Shenzhen Venture Capital, Tsinghua University in an incubation business to be located at the CyberCity Shenzhen science park.

- Ascendas, the synergistic merger between Arcasia Land and JTC International (JTCi)'s Business Parks and Facilities Group, brings to the consortium a well-established track record in the development, management and marketing of science parks, high tech parks, ready-built facilities and build-to-suit facilities. Ascendas is Asia's leading provider of total business space solutions with presence in Singapore, India, China, the Philippines, United States and Japan.

- F&N, through its property arm, Centrepoint Properties, will collaborate with Hing Kong in residential and commercial property development, both in Hong Kong and the PRC. There are also potential synergies between Hing Kong, CyberCity and Times Publishing, F&N's new venture arm, in IT and internet-related businesses.

The completion of the conditional sale and purchase agreement between Vision Century and CTII's subsidiary will trigger a general offer for the remaining Hing Kong shares also at HK$1 per share. Vision Century intends to retain Hing Kong's listing status.