By Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.
This announcement appears for information purpose only and does not constitute an invitation or offer to acquire, purchase or subscribe for the securities of the Company.
Global Energy Resources International Group Limited(continued in Bermuda with limited liability)
(Stock Code: 8192) PLACING OF NEW SHARES UNDER GENERAL MANDATE Placing AgentKINGSTON SECURITIES LTD.
THE PLACING
On 24 January 2014 (after trading hours), the Placing Agent and the Company entered into the Placing Agreement pursuant to which the Placing Agent agreed to place, on a best effort basis, up to 250,960,000 Placing Shares to currently expected not less than six Placees who are Independent Third Parties.
Assuming that there will be no change in the issued share capital of the Company between the date of this announcement and the completion of the Placing, the 250,960,000 Placing Shares under the Placing represent (i) approximately 13.33% of the existing issued share capital of the Company of 1,882,200,000 Shares as at the date of this announcement; and (ii) approximately 11.76% of the issued share capital of the Company as enlarged by the allotment and issue of the Placing Shares. The aggregate nominal value of the Placing Shares under the Placing will be HK$1,254,800.
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The Placing Price of HK$0.39 represents a discount of approximately 18.92% to the benchmarked price of the Shares, which is the higher of (i) the closing price of HK$0.45 as quoted on the Stock Exchange on the date of the Placing Agreement; and (ii) the average closing price of HK$0.481 in the last 5 trading days prior to the date of the Placing Agreement.
The Placing is conditional upon, among other things, the Listing Committee of the Stock Exchange granting or agreeing to grant the listing of, and permission to deal in, the Placing Shares.
The gross proceeds from the Placing will be approximately HK$97.87 million. The net proceeds from the Placing will amount to approximately HK$95.30 million which is intended to be used (i) as to approximately HK$80 million for future investment of the Group in environmental friendly business, in particular the energy saving and emission reduction business; and (ii) as to the remaining balance of approximately HK$15.30 million for general working capital of the Group. The net price raised per Placing Share will be approximately HK$0.38 per Share.
24 January 2014 (after trading hours)
IssuerThe Company
Placing Agent
The Placing Agent has conditionally agreed to place up to 250,960,000 Placing Shares on a best effort basis to independent investors reference to prevailing market rate. The Directors are of the view that the terms of the Placing, including the placing commission of 2.5% of the aggregate amount equal to the Placing Price multiplied by the actual number of the Placing Shares being placed are fair and reasonable based on current market conditions.
To the best of the Directors' knowledge, information and belief, having made all reasonable enquiries, as at the date of this announcement, the Placing Agent and its ultimate beneficial owners are Independent Third Parties. As at the date of this announcement, the Placing Agent and its associates are not interested in any Share.
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The Placing Agent will place the Placing Shares to currently expected not less than six Placees (who will be independent professional, institutional or other investors), who and whose ultimate beneficial owner(s) will be third parties independent of, not connected with or acting in concert (as defined in the Hong Kong Code on Takeovers and Mergers) with any directors, chief executive or substantial shareholder(s) of the Company or of its subsidiaries and their respective associates (as defined under the Listing Rules). If any of the Placees becomes a substantial Shareholder (as defined under the Listing Rules) after the completion of the Placing, a further announcement will be made by the Company.
Placing SharesAssuming that there will be no change in the issued share capital of the Company between the date of this announcement and the completion of the Placing, the 250,960,000 Placing Shares under the Placing represent (i) approximately 13.33% of the existing issued share capital of the Company of 1,882,200,000 Shares as at the date of this announcement; and (ii) approximately 11.76% of the issued share capital of the Company as enlarged by the allotment and issue of the Placing Shares. The aggregate nominal value of the Placing Shares under the Placing will be HK$1,254,800.
Ranking of the Placing Shares
The Placing Shares under the Placing will rank, upon issue, pari passu in all respects with the
Shares in issue on the date of allotment and issue of the Placing Shares.
The Placing Price of HK$0.39 represents a discount of approximately 18.92% to the benchmarked price of the Shares, which is the higher of (i) the closing price of HK$0.45 as quoted on the Stock Exchange on the date of the Placing Agreement; and (ii) the average closing price of HK$0.481 in the last 5 trading days prior to the date of the Placing Agreement.
The Placing Price was determined with reference to the prevailing market price of the Shares and was negotiated on an arm's length basis between the Company and the Placing Agent. The Directors consider that the terms of the Placing are on normal commercial terms and are fair and reasonable based on the current market conditions. Hence, the Placing is in the interests of the Company and the Shareholders as a whole.
The Placing Shares will be issued under the General Mandate to allot, issue and deal with Shares granted to the Directors by resolution of the Shareholders passed at the 2013 AGM subject to the limit up to 20% of the then issued share capital of the Company as at the date of the 2013 AGM. Accordingly, the issue of the Placing Shares is not subject to the approval of the Shareholders. Under the General Mandate, the Company is authorized to issue up to
250,960,000 Shares under the General Mandate. Up to the date of this announcement, no
Share has been issued under the General Mandate.
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Completion of the Placing is conditional upon:
(i) the Listing Committee of the Stock Exchange granting or agreeing to grant the listing of, and permission to deal in, the Placing Shares under the Placing; and
(ii) the obligations of the Placing Agent under the Placing Agreement not being terminated in accordance with the terms of the Placing Agreement, including provisions regarding force majeure events.
Completion of the Placing, in any event, will take place within four business days after the fulfillment of the conditions as set out in paragraph headed "Conditions of the Placing Agreement" above or such other date to be agreed between the Company and the Placing Agent in writing (the "Completion Date"). If the above conditions are not satisfied and/ or waived (other than condition (i) above, which cannot be waived) in whole or in part by the Placing Agent on or before 5:00 p.m. on 7 February 2014 or such later date to be agreed between the Company and the Placing Agent in writing, the Placing will be terminated and the Placing will not proceed and all obligations and liabilities of the parties under the Placing Agreement will forthwith cease and determine and no party will have any claim against the others (save for any antecedent breaches hereof).
Termination and force majeure The Placing Agent may terminate the Placing Agreement by notice in writing prior to 9:00 a.m. on the Completion Date, if in the absolute opinion of the Placing Agent, the success of the Placing would be materially and adversely affected by any force majeure events: (a) the introduction of any new laws or regulations or any change in existing laws or regulations (or the judicial interpretation thereof) or other occurrence of any nature whatsoever which may, in the absolute opinion of the Placing Agent, materially and adversely affect the business or the financial or trading position or prospects of the Group as a whole; or (b) the occurrence of any local, national or international event or change (whether or not forming part of a series of events or changes occurring or continuing before and/or after the date of the Placing Agreement) of a political, military, financial, economic, currency (including a change in the system under which the value of the Hong Kong currency is linked to the currency of the United States of America) or other nature (whether or not sui generis with any of the foregoing), or in the nature of any local, national, international outbreak or escalation of hostilities or armed conflict, or affecting local securities market or the occurrence of any combination of circumstances which may, in the absolute opinion of the Placing Agent, materially and adversely affect the business or the financial or trading position or prospects of the Group as a whole or adversely prejudices the success of the Placing of the Shares by potential investor(s) or otherwise makes it inexpedient or inadvisable for the Company or the Placing Agent to proceed with the Placing; or- 4 -
(c) any change in market conditions or combination of circumstances in Hong Kong (including without limitation suspension or material restriction on trading in securities) occurs which affect the success of the Placing (such success being the placing of the Shares to potential investor(s)) or otherwise in the absolute opinion of the Placing Agent make it inexpedient or inadvisable or inappropriate for the Company or the Placing Agent to proceed with the Placing.
If, at or prior to 9:00 a.m. on the Completion Date:
(a) t h e Company commits any material breach of or omits to observe any of the obligations or undertakings expressed or assumed under the Placing Agreement; or
(b) the trading of the Shares on GEM has been suspended for more than ten consecutive trading days save for the purposes of clearing of the announcement relating to the Placing Agreement or any announcements or circulars relating to the Placing; or
(c) the Placing Agent shall become aware of the fact that any of the representations or warranties contained in the Placing Agreement was, when given, untrue or inaccurate or would in any respect be untrue or inaccurate if repeated the Placing Agent shall determine that any such untrue representation or warranty represents or is likely to represent a material adverse change in the financial or trading position or prospects of the Group taken as a whole or will otherwise likely to have a material prejudicial effect on the Placing,
the Placing Agent shall be entitled (but not bound) by notice in writing to the Company to elect to treat such matter or event as releasing and discharging the Placing Agent from its obligations under the Placing Agreement.
Upon giving of notice pursuant to the paragraph above, all obligations of the Placing Agent under the Placing Agreement shall cease and determine and no party shall have any claim against any other parties in respect of any matter or thing arising out of or in connection with the Placing Agreement, save for any antecedent breaches.
The Directors are not aware of the occurrence of any of such events as at the date of this announcement.
The Placing may or may not proceed. Shareholders and potential investors are advised to exercise caution when dealing in the Shares.
REASONS FOR THE PLACING AND USE OF PROCEEDS
The Company is principally engaged in the manufacturing and sales of environmental friendly air-conditioners and related products.
The gross proceeds from the Placing will be approximately HK$97.87 million. The net proceeds from the Placing will amount to approximately HK$95.30 million which is intended to be used (i) as to approximately HK$80 million for future investment of the Group in environmental friendly business, in particular the energy saving and emission reduction
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business; and (ii) as to the remaining balance of approximately HK$15.30 million for general working capital of the Group. The net proceeds raised per Placing Share will be approximately HK$0.38 per Share.
The Directors have considered various ways of raising funds and believe that the Placing represents an opportunity to raise capital for the Group to further develop its environmental friendly business while broadening its Shareholder and capital base. Accordingly, the Directors are of the view that the Placing is in the best interest of the Company and its Shareholders as a whole.
Apart from the fund raising activities mentioned below, the Company has not carried out any fund raising activities during the 12 months immediately preceding the date of this announcement.
Date of initial announcement Fund raising activity Intended use of net proceeds Actual use of proceeds11 November 2013 | Open offer | - | Approximately HK$11.48 million for repayment of an outstanding loan due to Sound Treasure Holdings Limited | - | Approximately HK$11.48 million have been used to repay the said loan |
- | Approximately HK$18 million for future investment of the Group in related business, in particular the energy saving and environmental friendly business | - | Approximately HK$18 million is currently kept in an interest bearing bank account pending for usage | ||
- | Approximately HK$12.48 million for the Group's general working capital | - | Approximately HK$4.09 million have been used for the Group's general working capital |
The existing shareholding structure of the Company and the effect on the shareholding structure of the Company upon completion of the Placing is set out as below:
Immediately upon Shareholders As at the date of this announcement completion of the Placing (Note 1)Number of
Shares
Approximate
%
Number of
Shares
Approximate
%
Li Yu 133,600,000 7.10 133,600,000 6.26
Fu Xueliang 100,000,000 5.31 100,000,000 4.68
Placees (Note 2) - - 250,960,000 11.76
Other public Shareholders 1,648,600,000 87.59 1,648,600,000 77.28
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Notes:
1. This assumes the Placing is fully placed.
2. The Placing Shares will be placed by the Placing Agent to currently expected not less than six independent Placees. Upon completion of the Placing, it is expected that none of the Placees will become a substantial Shareholder of the Company. Accordingly, the shareholding held by the Placees is regarded as held by the public.
GENERALApplication will be made by the Company to the Listing Committee of the Stock Exchange for the grant of the listing of, and permission to deal in, the Placing Shares.
TERMS AND DEFINITIONS
In this announcement, unless the context otherwise requires, the following words and expressions shall have the meaning ascribed to them below:
"2013 AGM" the annual general meeting of the Company held on 9 May
2013
"Board" the board of Directors
"Company" Global Energy Resources International Group Limited (stock code: 8192), a company incorporated in the Cayman Islands and continued in Bermuda with limited liability and the issued Shares of which are listed on GEM
"connected person(s)" the meaning ascribed thereto in the GEM Listing Rules
"Director(s)" the director(s) of the board of the Company
"GEM" the Growth Enterprise Market of the Stock Exchange
"GEM Listing Rules" the Rules Governing the Listing of Securities on the GEM
"General Mandate" the mandate granted to the Directors by the Shareholders at the 2013 AGM to allot, issue and deal with up to 20% of the then issued share capital of the Company as at the date of the
2013 AGM
"Group" the Company and its subsidiaries
"Hong Kong" Hong Kong Special Administrative Region of the People's
Republic of China
"Independent Third Party(ies)" third party(ies) independent of and not connected with the Company and its connected persons (has the meaning ascribed to it in the GEM Listing Rules)
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"Listing Committee" has the meaning ascribed to it under the GEM Listing Rules
"Placee(s)" any professional, institutional or other investor(s) or any of their respective subsidiaries or associates procured by the Placing Agent to subscribe for any of the Placing Shares pursuant to the Placing Agent's obligations under the Placing Agreement
"Placing" the placing of 250,960,000 new Shares pursuant to the terms of the Placing Agreement
"Placing Agent" Kingston Securities Limited, a licensed corporation to carry on business in type 1 regulated activity (dealing in securities) under the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
"Placing Agreement" the conditional placing agreement entered into between the Company and the Placing Agent dated 24 January 2014 in relation to the Placing
"Placing Price" HK$0.39 per Placing Share
"Placing Share(s)" up to 250,960,000 new Shares to be placed pursuant to the
Placing Agreement
"Share(s)" ordinary share(s) of HK$0.005 each in the issued share capital of the Company
"Shareholder(s)" holder(s) of the Share(s)
"Stock Exchange" The Stock Exchange of Hong Kong Limited
"HK$" Hong Kong dollars, the lawful currency of Hong Kong
"%" per cent.
By order of the Board
Chief Executive Officer and Executive Director
Hong Kong, 24 January 2014
As at the date of this announcement, the board of Directors comprises Mr. Zhang Shi Min, Mr. Chan Kwok Wing, Mr. Chen Hong Bo and Ms. Ge Yan Hong as executive Directors and Mr. Leung Wah, Mr. Fung Hoi Wing, Henry and Mr. Gao Jin Lu as independent non-executive Directors.
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This announcement, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this announcement is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this announcement misleading.
This announcement will remain on the GEM website at www.hkgem.com on the "Latest Company Announcements" page for at least 7 days from the date of its posting and on the Company website at www.8192.com.hk.
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