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(Incorporated in the Cayman Islands with limited liability) (Stock Code: 3662)
DISCLOSEABLE TRANSACTION
PURCHASE OF LAND USE RIGHTS OF ONE LAND PLOT IN FENGXIAN DISTRICT, SHANGHAI CITY
Aoyuan Healthy Life Group Company Limited is pleased to announce that, on 12 December 2019, the Purchaser, an indirect wholly-owned subsidiary of the Company, won the bid for a land plot in Fengxian District, Shanghai City and entered into the grant contract of state-owned construction land use right at a total consideration of RMB82,000,000 (equivalent to approximately HK$91,020,000).
In accordance with the Listing Rules, as the highest applicable percentage ratio in respect of the Fengxian Land Acquisition is more than 5% but less than 25%, the Fengxian Land Acquisition constitutes a discloseable transaction of the Company and is therefore subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.
Aoyuan Healthy Life Group Company Limited (the “Company”, together with its subsidiaries, the “Group”) is pleased to announce that, on 12 December 2019, Shanghai Aohuiyan Health and Technology Company Limited*, an indirect wholly-owned subsidiary of the Company (the “Purchaser”), won the bid for the state-owned construction land use right of the land plot Fengxian Industrial Comprehensive Development Zone No. 11A-01A (the “Land Plot”) in Fengxian District, Shanghai City, China (the “Bid”). On the same date, the Purchaser entered into a grant contract of state-owned construction land use right (the “Land Use Right Grant Contract”) with Shanghai Fengxian Urban Planning and Natural Resources Bureau* (上海市奉賢區規劃和自然資源局) (the “Vendor”), the vendor of the land use right of the Land Plot, in relation to the acquisition of the land use right of the Land Plot (the “Fengxian Land Acquisition”).
The Land Plot has a total area of approximately 30,369.2 square meters, aboveground construction plot ratio of 2.5 and aboveground construction area of approximately 75,923 square meters, with a term of 50 years for scientific research and design use. 1 THE LAND USE RIGHT GRANT CONTRACT
Date : 12 December 2019
Vendor : Shanghai Fengxian Urban Planning and Natural Resources Bureau* ( 上海市奉賢區規劃和自然資源局)
Purchaser : Shanghai Aohuiyan Health and Technology Company Limited* (上 海奧慧妍健康科技有限公司), an indirect wholly-owned subsidiary of the Company
Location of the Land Plot: : The Land Plot is situated in Fengpu subdistrict of Fengxian District, Shanghai City, China
Total Area of the Land Plot : The total area of the Land Plot is approximately 30,369.2 square meters; and the total aboveground construction area is approximately 75,923 square meters
Term of land use rights : The term of land use rights of the Land Plot is 50 years for scientific research and design use
Consideration : RMB82,000,000 (equivalent to approximately HK$91,020,000) (the “Consideration”), which will be funded by the internal resources of the Group
Basis of Consideration : The Consideration was determined by way of public listing and tendering
Expected completion date : The Land Plot shall be delivered from the Vendor to the Purchaser within 35 business days of execution of the Land Use Right Grant Contract
Expected payment term : The Consideration is payable within 30 business days of execution of the Land Use Right Grant Contract
Performance deposit : A performance deposit amounting to 20% of the Consideration, for guaranteeing the Purchaser’s timely performance of its obligations under the Land Use Right Grant Contract in relation to the development and use of the properties to be developed on the Land Plot, shall be paid by cash deposit or in the form of letter of guarantee by the Group within 5 business days of execution of the Land Use Right Grant Contract
2 INFORMATION ABOUT FENGXIAN DISTRICT, SHANGHAI CITY, CHINA
Fengxian District is located in the south of Shanghai City and the southeast of the Yangtze River Delta. It borders Pudong New Area on the east, Jinshan District and Songjiang District on the west, Hongzhou Bay on the south, and Minhang District on the north. The Shanghai Fengxian Economic Development Zone was approved as a municipal-level development zone. Fengxian District has been dubbed as the “Oriental Beauty Valley” which has attracted some of the largest direct sellers of makeups and personal care products and many other well-known makeup brands. It was also the only place in China which was awarded the title of the “Capital of China’s Cosmetics Industry”.
REASONS AND BENEFITS FOR THE TRANSACTION
The Group actively expanded its service offerings to commercial operation and healthcare areas, seized the opportunities brought by industrial transformation and upgrading and policies related to the development of the areas supported by China’s national development strategies, such as the Yangzi River Delta and the Greater Bay Area. To implement its business strategy of diversifying services to meet the evolving demands of customers, focusing on the development of general health and wellness industry such as medical beauty and Chinese healthcare while adopting the innovative development model of “health + technology” and “health + ecosystem of businesses”, the Group has established and is operating two traditional Chinese medicine centres and a medical beauty clinic in its managed properties. For the six months ended 30 June 2019, the Group applied diversified services in two ecosystems of “lives in properties and commercial complex” and continuously integrated resources to provide medical beauty services and traditional Chinese medicine services for customers.
The State Council issued the “Healthy China 2030” blueprint* 《健康中國( 2030規劃綱要》) and outlined the strategy of a “Healthy China”. In particular, the beauty and health industry, which is a crucial part of the health industry, shall integrate into the national key strategy. The “Comments on Promoting the Development of Beauty and Health Industry in Shanghai”* 《關於推進上海美麗健康產業發展的若( 干意見》) issued by the Shanghai Municipal Government echoed with the above national policy and highlighted that beauty and health industry shall be an important pillar in the development of “Universal Health” industry. As a project embracing the above industrial development strategies, the Land Plot will be developed into a healthcare and medical beauty industrial complex, including the establishment of regional headquarters of the general health and wellness industry, technology incubator center of the general health and wellness, medical beauty flagship store, research and development center for medical beauty products, display center for medical beauty products, experience center and talent training center in such industrial complex. The Group also intends to introduce strategic partners and professional talents for the research and development of medical beauty products and provide professional talent training for the Group’s general health and wellness industry.
In view of the above reasons and benefits, the directors of the Company believe that the terms of the Bid and the Land Use Right Grant Contract and the transactions contemplated thereunder are fair and reasonable and in the interests of the Company and its shareholders as a whole.
INFORMATION ABOUT THE GROUP
The principal business activities of the Group are the provision of property management services and commercial operational services. Meanwhile, the Group is deepening and expanding diversified healthcare services, developing mature community healthcare, medical beauty technology, and other businesses, so as to provide users with a healthy living and social environment, and build a comprehensive healthy life platform.
3 INFORMATION ABOUT THE VENDOR
The Vendor is a government department in Fengxian District, Shanghai City, China and an authority under Shanghai Municipal Government.
To the best of knowledge, information and belief of the directors of the Company having made all reasonable enquiries, Shanghai Municipal Government (being the authority which the Vendor is subordinated to) is a government institution, and Shanghai Municipal Government and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons and are not the connected persons of the Company.
LISTING RULES IMPLICATIONS
In accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”), as the highest applicable percentage ratio in respect of the Fengxian Land Acquisition is more than 5% but less than 25%, the Fengxian Land Acquisition constitutes a disclosable transaction of the Company and is therefore subject to notification and announcement requirements under Chapter 14 of the Listing Rules.
There can be no assurance that any forward-looking statements regarding the business development of the Group set out in this announcement and any of the matters set out herein are attainable, will actually occur or will be realised or are complete or accurate. Shareholders and/or potential investors of the Company are advised to exercise caution when dealing in the securities of the Company and not to place any excessive reliance on the information disclosed herein. Any shareholder or potential investor of the Company who is in doubt is advised to seek advice from professional advisors.
By the order of the Board Aoyuan Healthy Life Group Company Limited Guo Zining Chairman
Hong Kong, 12 December 2019
For illustration purpose only, RMB is converted into HK$ at an exchange rate of RMB1.00 = HK1.11 in this announcement.
* For identification purpose only.
As at the date of this announcement, the executive directors of the Company are Mr. Miao Sihua and Mr. Tao Yu; the non-executive directors of the Company are Mr. Guo Zining and Mr. Chen Zhibin; and the independent non-executive directors of the Company are Mr. Hung Ka Hai Clement, Dr. Li Zijun and Mr. Wang Shao.
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