SUNDAY Communications Limited
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THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION If you are in any doubt as to any aspect of this Circular, you should consult your stockbroker or other 14.63(2)(b) registered dealer in securities, bank manager, solicitor, professional accountant or other professional 14A.58(3)(b) adviser. If you have sold or transferred all your shares in SUNDAY Communications Limited, you should at once hand this Circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee. The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this Circular, makes 14.58(1) no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for 14A.59(1) any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular. App1B(1) SUNDAY Communications Limited (Incorporated in the Cayman Islands with limited liability) (Stock Code: 0866) (1) VERY SUBSTANTIAL DISPOSAL AND CONNECTED TRANSACTION (2) VOLUNTARY WITHDRAWAL OF LISTING AND PROPOSED DISTRIBUTION Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders of SUNDAY Communications Limited A letter from the board of directors of SUNDAY Communications Limited is set out on pages 9 to 26 of this Circular. A letter from the Independent Board Committee (as defined herein) containing its advice to the Independent Shareholders (as defined herein) is set out on pages 27 and 28 of this Circular. A letter from ING Bank N.V., the independent financial adviser to the Independent Board Committee and the Independent Shareholders, containing its advice to the Independent Board Committee and the Independent Shareholders, is set out on pages 29 to 44 this Circular. A notice convening an extraordinary general meeting (“EGM”) of the Company to be held in the Conference Room, 14th Floor, PCCW Tower, TaiKoo Place, 979 King’s Road, Quarry Bay, Hong Kong at 3:00 p.m. on Thursday, 30 November 2006 is set out on pages 176 to 179 of this Circular. A form of proxy for use at the EGM is enclosed. Whether or not you intend to attend and vote at the EGM or any adjourned meeting in person, you are requested to complete and sign the enclosed form of proxy in accordance with the instructions printed thereon and to lodge it with the Company’s Hong Kong branch share registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong as soon as possible, but in any event not less than 48 hours before the time appointed for holding the EGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjourned meeting should you so wish. 7 November 2006 CONTENTS Page Expected Timetable ........................................................ 1 Definitions ............................................................... 4 Letter from the Board ..................................................... 9 Letter from the Independent Board Committee .................................. 27 Letter from the Independent Financial Adviser .................................. 29 Appendix I — Summary of certain provisions of the Cayman Islands company law and the BVI company law ..................... 45 Appendix II — Summary of the Existing Memorandum and Articles of Association and the New Memorandum and Articles of Association ................................... 62 Appendix III — Accountants’ report on the SUNDAY Group ................... 88 Appendix IV — Unaudited pro forma financial information of the Remaining Group ................................. 157 Appendix V — Additional financial information about the SUNDAY Group ....... 168 Appendix VI — General Information ...................................... 170 Notice of Extraordinary General Meeting ...................................... 176 EXPECTED TIMETABLE If the conditions applicable to the Offer, the Sale, the Proposed Distribution and the Withdrawal Proposal are all fulfilled, the following details the expected timetable to implement such proposals: Hong Kong time (unless otherwise stated) Latest time for receipt by the Depositary of completed Voting Instruction Cards from ADS Holders (Notes 1 and 2) ....5:00p.m.(NewYorktime)on Wednesday, 22 November 2006 Latest time for lodging transfers of Shares to qualify for attending and voting at the EGM (Note 2) .............................4:00p.m.on Monday, 27 November 2006 Register of members closed for determination of Shareholders entitled to attend and vote at the EGM .........Tuesday,28November 2006 to Thursday, 30 November 2006 (both days inclusive) Latest time for lodging the form of proxy for the EGM (Note 3) ................ 3:00p.m.on Tuesday, 28 November 2006 Suspension of dealings in the Shares .............. 9:30a.m.onThursday, 30 November 2006 EGM.......................................3:00p.m.onThursday, 30 November 2006 The Board conditionally declares the Proposed Distribution and fixes the record date for the Proposed Distribution .........Thursday, 30 November 2006 Announcement of results of the EGM and the proposed withdrawal of the listing of the Shares on the Stock Exchange, conditional declaration of the Proposed Distribution by the Board and the record date for the Proposed Distribution, along with notice of intent to delist and to suspend trading in the ADSs, to be published in The Standard (in English) and the Hong Kong Economic Times (in Chinese), via press release in the United States and on the Company’s website ............... Friday,1December 2006 The Company notifies the NASDAQ Global Market of its intent to delist and to suspend trading in the ADSs ............... Friday,1December 2006 Resumption of dealings in the Shares ..................................... 9:30a.m.on Friday, 1 December 2006 — 1 — EXPECTED TIMETABLE Completion of the Sale (Note 4) .............................. Monday, 4 December 2006 Form 25 to delist the ADSs from the NASDAQ Global Market filed with the SEC and provided to the NASDAQ Global Market . Monday, 11 December 2006 Last day of dealings in the Shares on the Stock Exchange (Note 5) ..............4:00p.m.on Tuesday, 12 December 2006 Last day of dealings in the ADSs on the NASDAQ Global Market .............. 5:00a.m.on Tuesday, 12 December 2006 Suspension of trading in the ADSs ...................................... 10:30p.m.on Tuesday, 12 December 2006 Latest time for lodging transfers of Shares to qualify for entitlements for the Proposed Distribution ............................ 4:00p.m.on Friday, 15 December 2006 Record date for the Proposed Distribution (Notes 5 and 6) .................... 4:00p.m.on Friday, 15 December 2006 Withdrawal of listing of the Shares on the Stock Exchange effective ............................................ 9:30a.m.on Monday, 18 December 2006 Announcement of the withdrawal of the listing of the Shares on the Stock Exchange to be published in The Standard (in English) and the Hong Kong Economic Times (in Chinese) .... Monday, 18 December 2006 Effective date on which the Company is de-registered in the Cayman Islands and continued as a BVI business company in the BVI ...........................Wednesday, 20 December 2006 Withdrawal of the ADSs from listing on the NASDAQ Global Market ....................................................10:30p.m.on Thursday, 21 December 2006 Cheques for cash payments and payments through CCASS pursuant to the Proposed Distribution to be despatched to the Independent Shareholders on or before (Note 5) ............. Friday,29December 2006 Shareholders resolution passed to wind up the Company ...........Wednesday, 3 January 2007 Form 15 filed with the SEC to deregister the Shares ......................thedateonwhich the Company is wound up — 2 — EXPECTED TIMETABLE The Shares are deregistered under the Exchange Act ................90days after the date on which the Company is wound up Notes: 1. Voting Instruction Cards should be returned to the Depositary in accordance with the instructions on the Voting Instruction Card as soon as possible and in any event no later than 5:00 p.m. (New York time) on Wednesday, 22 November 2006. If an ADS Holder does not return the Voting Instruction Card by this time, the Shares underlying his or her ADSs will not be voted at the EGM. 2. ADS Holders who wish to surrender their ADSs, withdraw the underlying Shares and become registered holders of the Shares should contact the Depositary at (001) (212) 815 2783. 3. The form of proxy should be lodged, by hand or by post, with Computershare Hong Kong Investor Services Limited, the Hong Kong branch share registrar of the Company, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong, as soon as possible and in any event no later than the time and date stated above. In order to be valid, the form of proxy for the EGM must be lodged no later than the time and date stated above. Completion and return of the form of proxy for the EGM will not preclude a Shareholder from attending the EGM and voting in person. In such event, the returned form of proxy will be deemed to have been revoked. 4. Assuming the requisite approval is obtained at the EGM, it is the Board’s intention to proceed to accept the Offer immediately following the EGM. The Company, the