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.
AEON STORES (HONG KONG) CO., LIMITED
永 旺( 香 港 )百 貨 有 限 公 司
(Incorporated in Hong Kong with limited liability)
(Stock Code: 984)
MAJOR TRANSACTION IN RELATION TO OFFER TO LEASE
The Board is pleased to announce that on 27 November 2019, the Company as tenant received the duly accepted Offer to Lease (which was issued by the Company on 15 November 2019) from the Agent as agent of the Landlords in respect of the lease of the Premises. Prior to entering into the Offer to Lease, the Company has been occupying the Premises as tenant and has been operating one of its general merchandise stores at the Premises.
Pursuant to HKFRS 16, the entering into of the Offer to Lease as tenant will require the Group to recognise the Premises as right-of-use asset. Therefore, the entering into of the Offer to Lease will be regarded as an acquisition of asset by the Group under the Listing Rules. The value of right-of-use asset recognised by the Company under the Offer to Lease amounted to approximately HK$539.7 million.
As the highest applicable percentage ratio as defined under the Listing Rules in respect of the acquisition of right-of-use asset recognised by the Group pursuant to HKFRS 16 based on the consideration under the Offer to Lease is 25% or more but is less than 100%, the entering into of the Offer to Lease constitutes a major transaction of the Company and is subject to the notification, announcement, circular and shareholders' approval requirements under Chapter 14 of the Listing Rules.
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To the best of the knowledge of the Directors, as no Shareholder or any of their respective associates has a material interest in the Offer to Lease and the transaction contemplated thereunder, no Shareholder will be required to abstain from voting at a general meeting of the Company for approving the same. Accordingly, pursuant to Rule 14.44 of the Listing Rules, written Shareholders' approval may be accepted in lieu of holding a general meeting. The Company has obtained written approval from AEON Co., which holds 155,760,000 issued ordinary shares of the Company (representing 59.91% of its entire issued share capital as at the date of this announcement). As such, the Company is exempted from convening a general meeting to approve the Offer to Lease and the transaction contemplated thereunder.
A circular of the Company containing, among other things, further information on the Offer to Lease and the transaction contemplated thereunder is expected to be despatched to the Shareholders for information purposes in accordance with the Listing Rules on or before 18 December 2019.
INTRODUCTION
The Board is pleased to announce that on 27 November 2019, the Company as tenant received the duly accepted Offer to Lease (which was issued by the Company on 15 November 2019) from the Agent as agent of the Landlords in respect of the lease of the Premises. Prior to entering into the Offer to Lease, the Company has been occupying the Premises as tenant and has been operating one of its general merchandise stores at the Premises.
The principal terms of the Offer to Lease are set out below:
The Offer to Lease | |
Date of acceptance: | 27 November 2019 |
Parties: | Tenant: AEON Stores (Hong Kong) Co., Limited (永旺(香港)百 |
貨有限公司), as tenant | |
Agent: SINO REAL ESTATE AGENCY LIMITED (信和地產 | |
代理有限公司), as agent of the Landlords | |
Premises: | 1301-1350 of Floor 01, 081-112 of Floor G and 082-120 of |
Floor UG of Tuen Mun Town Plaza (I), 1 Tuen Shing Street, | |
Tuen Mun, New Territories, Hong Kong | |
Term: | From 16 April 2020 to 15 April 2026 (both dates inclusive) |
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Usage: | For use only by the Company and the Company's licensees (as |
permitted by the Landlords) as the operation of a general | |
merchandise store, including supermarkets and restaurants | |
under the trade name of AEON or such other name to be | |
approved by the Landlords in advance (such approval shall not | |
be unreasonably withheld) | |
Total consideration | Total base rent payable under the Offer to Lease is |
payable: | approximately HK$618.2 million, which is subject to annual |
turnover rent which may be imposed pursuant to the terms and | |
conditions of the Offer to Lease (exclusive of rates, government | |
rent, management fee, air-conditioning charge, other charges | |
and other outgoings) | |
The consideration will be satisfied by internal resources of the | |
Group | |
Payment term: | The monthly base rent shall be payable monthly in advance on |
the first day of each calendar month | |
The annual turnover rent (if payable pursuant to the terms and | |
conditions of the Offer to Lease) shall be payable yearly in | |
arrears | |
Deposit: | Approximately HK$33.7 million (representing three months of |
the monthly base rent, management fee, air-conditioning charge, | |
rates and government rent), which is paid partly by cash and | |
partly by way of bank guarantee (as guarantee of the due | |
performance and observance by the Company of its obligations | |
throughout the term of the Offer to Lease) |
INFORMATION OF THE PARTIES
The Group is principally engaged in the operation of general merchandise stores in Hong Kong and the PRC.
The Landlords and the Agent are principally engaged in property investment and real estate agency activities, respectively.
To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, the Agent, the Landlords and their respective ultimate beneficial owner(s) are Independent Third Parties.
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REASONS FOR AND BENEFITS OF THE OFFER TO LEASE
The principal business of the Group is the operation of retail businesses through chain stores under the trade names of ''AEON STYLE'', ''AEON'', ''AEON SUPERMARKET'' and ''MaxValu'' in Hong Kong and the PRC. Due to the nature of its retail businesses, the Group has to enter into tenancy agreements for the leasing of retail stores from time to time. Each of the retail stores, especially sizable stores like the Premises, contributes to and maintains the Group's scale of operation which in turn benefits the Group in lowering the overall operation costs, in enhancing the Group's negotiations with its business partners and in expending its store network and market shares.
The terms of the Offer to Lease, including the rental charge, were determined after arm's length negotiations between the Parties and with reference to the open market rent of comparable properties and the rental payment made by the Group under the Existing Lease. The entering into of the Offer to Lease is necessary for the operation of the retail businesses in the ordinary and usual course of business of the Group. Therefore, the Board considers that the terms of the Offer to Lease are on normal commercial terms and are fair and reasonable and the entering into of the Offer to Lease is in the interests of the Company and the Shareholders as a whole.
IMPLICATIONS UNDER THE LISTING RULES
Acquisition of asset by the Company
Pursuant to HKFRS 16, the entering into of the Offer to Lease as tenant will require the Group to recognise the Premises as right-of-use asset. Therefore, the entering into of the Offer to Lease will be regarded as an acquisition of asset by the Group under the Listing Rules. The value of right-of-use asset recognised by the Company under the Offer to Lease amounted to approximately HK$539.7 million.
Major transaction
As the highest applicable percentage ratio as defined under the Listing Rules in respect of the acquisition of right-of-use asset recognised by the Group pursuant to HKFRS 16 based on the consideration under the Offer to Lease is 25% or more but is less than 100%, the entering into of the Offer to Lease constitutes a major transaction of the Company and is subject to the notification, announcement, circular and shareholders' approval requirements under Chapter 14 of the Listing Rules.
To the best of the knowledge of the Directors, as no Shareholder or any of their respective associates has a material interest in the Offer to Lease and the transaction contemplated thereunder, no Shareholder will be required to abstain from voting at a general meeting of the Company for approving the same. Accordingly, pursuant to Rule
14.44 of the Listing Rules, written Shareholders' approval may be accepted in lieu of holding a general meeting. The Company has obtained written approval from AEON
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Co., which holds 155,760,000 issued ordinary shares of the Company (representing 59.91% of its entire issued share capital as at the date of this announcement). As such, the Company is exempted from convening a general meeting to approve the Offer to Lease and the transaction contemplated thereunder.
A circular of the Company containing, among other things, further information on the Offer to Lease and the transaction contemplated thereunder is expected to be despatched to the Shareholders for information purposes in accordance with the Listing Rules on or before 18 December 2019.
DEFINITIONS
In this announcement, the following expressions have the following meanings unless the context requires otherwise.
''AEON Co.'' | AEON Co., Ltd., a company incorporated in Japan with limited |
liability and the issued shares of which are listed on the Tokyo | |
Stock Exchange | |
''Agent'' | SINO REAL ESTATE AGENCY LIMITED (信和地產代理有限 |
公司), a company incorporated in Hong Kong with limited | |
liability, being the agent of the Landlords | |
''Board'' | the board of Directors |
''Company'' | AEON Stores (Hong Kong) Co., Limited (永旺(香港)百貨有限 |
公司), a company incorporated in Hong Kong with limited | |
liability and the issued shares of which are listed on the Stock | |
Exchange (stock code: 984) | |
''connected | has the meaning ascribed to it under the Listing Rules |
person(s)'' | |
''Director(s)'' | the directors of the Company |
''Existing Lease'' | the existing lease agreement and its extension letter entered into |
between the Company as tenant and the Landlords as landlord | |
on 5 November 2014 and 13 November 2018 respectively in | |
respect of the lease of the Premises | |
''Group'' | the Company and its subsidiaries |
''HK$'' | Hong Kong dollars, the lawful currency of Hong Kong |
''HKFRS'' | Hong Kong Financial Reporting Standards issued by the Hong |
Kong Institute of Certified Public Accountants |
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''Hong Kong'' | the Hong Kong Special Administrative Region of the PRC |
''Independent Third | the independent third party(ies) who is/are, to the best of the |
Party(ies)'' | Directors' knowledge, information and belief having made all |
reasonable enquiry, independent of the Company and its | |
connected person(s) | |
''Landlord(s)'' | ENTERTAINMENT CITY LIMITED (娛樂天地有限公司), a |
company incorporated in Hong Kong with limited liability, and | |
JADE MATE LIMITED (麗賢有限公司), a company | |
incorporated in Hong Kong with limited liability, being | |
landlords of the Premises | |
''Listing Rules'' | the Rules Governing the Listing of Securities on The Stock |
Exchange of Hong Kong Limited | |
''Offer to Lease'' | the offer to lease issued by the Company as tenant on 15 |
November 2019 and accepted by the Agent as agent of the | |
Landlords on 27 November 2019 in respect of the lease of the | |
Premises | |
''Party(ies)'' | the Company (as tenant) and the Agent (as agent of the |
Landlords) | |
''PRC'' | the People's Republic of China, which for the purpose of this |
announcement only, excludes Hong Kong, the Macau Special | |
Administrative Region of the PRC and Taiwan | |
''Premises'' | 1301 - 1350 of Floor 01, 081-112 of Floor G and 082-120 of |
Floor UG of Tuen Mun Town Plaza (I), 1 Tuen Shing Street, | |
Tuen Mun, New Territories, Hong Kong | |
''Shareholder(s)'' | registered holders of the shares of the Company from time to |
time | |
''Stock Exchange'' | The Stock Exchange of Hong Kong Limited |
''%'' | per cent. |
By Order of the Board | |
AEON Stores (Hong Kong) Co., Limited | |
Yuki HABU | |
Chairman |
Hong Kong, 27 November 2019
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As at the date of this announcement, the Executive Directors are Mr. Isei Nakagawa, Mr. Chak Kam Yuen, Mr. Lau Chi Sum Sam and Mr. Takenori Nagashima; the Non-executive Directors are Ms. Yuki Habu and Mr. Akinori Yamashita; and the Independent Non-executive Directors are Ms. Chan Yi Jen Candi Anna, Ms. Lo Miu Sheung, Betty, Mr. Chow Chi Tong and Mr. Hideto Mizuno.
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AEON Stores (Hong Kong) Co. Limited published this content on 27 November 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 November 2019 13:47:07 UTC