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PT International Announces Substantial Acquisition in Relation to Subscription of 65% Equity Interest in Thousand Vantage Investment Limited

·5-min read

HONG KONG, Mar 30, 2021 - (ACN Newswire) - PT International Development Corporation Limited (PT International; HKG: 0372) is pleased to announce the details of a substantial acquisition in relation to the subscription of 65% equity interest in Thousand Vantage Investment Limited.

On 29 March 2021, PT International entered into the Subscription Agreement through PT OBOR Financial Holdings Limited (PT OBOR), a wholly-owned subsidiary, with Thousand Vantage Investment Limited (Thousand Vantage) and the Guarantor to subscribe for 668,571,429 new ordinary shares of Thousand Vantage at the Subscription Price, being the Redemption Amount, which is the aggregate sum of the subscription price for the Preference Shares of HK$200,000,000, and the Accrued Amount up to the date of Completion (for reference, the Accrued Amount up to 31 March 2021 is expected to be approximately HK$3,825,000). Based on the Subscription Price, the price per Subscription Share shall be approximately HK$0.3049. The Subscription Price shall be paid on Completion by way of offsetting against the Redemption Amount payable by the Thousand Vantage for redemption of the Preference Shares issued by the Thousand Vantage to PT OBOR on 16 April 2018. Upon Completion, PT OBOR will hold approximately 65.0% of all the issued shares of the Thousand Vantage as enlarged by the Subscription Shares, and all Preference Shares issued by the Thousand Vantage shall have been fully redeemed.

Thousand Vantage is a company incorporated in Hong Kong with limited liability, the entire voting equity of which is wholly and beneficially owned by the Guarantor prior to Completion. Thousand Vantage holds 75% equity interest in its PRC Subsidiary Guangxi Guangming Warehouse Storage Limited (Guangxi Guangming). The remaining 25% equity interest in the Guangxi Guangming is held by Shanghai Jianchen Industrial Development Co., Ltd., which in turn is wholly owned by Beijing Lianxing (Beijing) International Trading Development Co., Ltd (Beijing Lianxing).

Guangxi Guangming was established in March 1995, and it is principally engaged in the provision of petrochemical port and storage service as well as port-related services and strategically located in South Western PRC. It is primarily engaged in the business of handling and storage of liquid dangerous goods such as gasoline, diesel oil, mixed aromatics and fuel oil through the operation of a terminal in Qinzhou Port in Guangxi Province, the PRC (the "Terminal"). It holds the required licences and permits for the operation of the Terminal including a port operation permit and Annexed Certificate for Hazardous Goods Operations at Ports. Qinzhou Port is one of the busiest deep-water ports near Qinzhou Petrochemical Park (QPP) in Guangxi, an international shipping hub in South Asia, and QPP is one of the top petrochemical parks in South Central China.

The Subscription represents a rare and valuable opportunity to the Group. This has enabled the Group to expand its mid-market portfolio and have ports and storage facilities in strategic locations in China. The Management believe that the investment in port-related operations remains a vital part of the growth of the Chinese economy and the petrochemical sector will yield better returns as compared with traditional cargo terminals. In view of this, the Group decided to strategically move up on the supply chain of commodity trading to midstream investment in storage facilities, which are midstream assets that major commodity trading firms usually own. Guangxi Guangming is the only entity in the form of a sino-foreign joint venture which owns petrochemical terminals and storage facilities in Guangxi. The Subscription and the investments in Yangtze Prosperity Development Limited and STX Corp form part of the Group's business strategy to establish the Group as an integrated commodities trading firm in Asia. The assets and resources of Thousand Vantage, Yangtze Prosperity Development Limited and STX Corp strengthen the Group's ability in offering storage and transportation services to its suppliers and customers of the commodities trading business, and therefore significantly enhances the Group's business profile and bargaining power in the commodities trading sector.

The Terminal of Guangxi Guangming is strategically located in Guangxi to benefit from the One-Belt-One-Road Initiative introduced by the PRC government. In particular, energy connectivity infrastructure, being one of the most important strategic focuses of the One-Belt One-Road Initiative, would drive the expansion of the scale of and the needs for domestic and international petrochemical ports and pipelines connectivity. Further, the 13th Five Year Plan of the PRC government places a focus on energy security of the country, and therefore progress will be accelerated in relation to construction of strategic corridors for importing oil and gas; and construction of oil and gas storage facilities to increase capacity and peak saving ability. The location of the Terminal stands to benefit from the above global infrastructure development strategy and the national policy of the PRC government.

Guangxi Guangming has a Terminal fully equipped with the New Berth with a capacity of 50,000 DWT, 29 storage tanks with approximately 633,700 cbm of petrochemical and energy products storage capacity in aggregate, truck loading stations, and rail loading terminal to provide integrated port and port-related services including loading and unloading of containers and cargo for international and domestic trades, berthing, unberthing, moorage services of vessels, container inspection at gate inside the port area and intra-port container transportation services.

"The subscription of Thousand Vantage is in line with the Group's upstream integration strategy, which will help us fully grasp the opportunities presented by the Belt and Road Initiative and the 13th Five-Year Plan, and make the Group's business more diversified. Guangxi Guangming is the only entity in the form of a sino-foreign joint venture which owns petrochemical terminals and storage facilities in Guangxi, which can contribute to significant revenue to the Group. Hence, we are confident that the subscription will help the Group to complete the integration link between upstream and downstream services relating to the commodity trading business and lead the Group to new heights and create long-term value for shareholders." said Mr. Ching Man Chun, Louis, Chairman and Managing Director of PT International Development Corporation Limited.

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