Partial divestment in Meize Energy Industries

RNS Number : 7646P

Jade Road Investments Limited

22 June 2022

 

22 June 2022

JADE ROAD INVESTMENTS LIMITED

("Jade Road Investments ", " JADE ", the "Company" or the "Group")

Jade Road Investments Limited (AIM: JADE), the London quoted pan-Asian diversified investment vehicle focused on providing shareholders with attractive uncorrelated, risk-adjusted long-term returns, is pleased to announce that the Company has successfully negotiated a partial divestment in Meize Energy Industries Holdings Limited ("Meize"), one of the leading privately-owned wind turbine blade manufacturing companies in China, currently the third-largest holding in the Company's portfolio (7.7% of NAV as at announcement).

On the 23^rd of November 2011, the Company , through its wholly-owned subsidiary Swift Wealth Investments Limited, subscribed to USD7.5MM of Series B Preferred Shares. This investment equates to a shareholding of approximately 7.2% in Meize.

The Company is pleased to announce that it has entered into a share purchase agreement ("SPA") for 112,500 shares of the Series B Preferred Equity in Meize for consideration of USD1.2 million (the "Transaction Price"). The Transaction Price will be received by the Company in three equal tranches. The number of shares sold in this partial divestment represents 12.0% of the Company's holding in Meize. The Company will hold approximately 6.3% interest in Meize post this divestment.

Before the release of this RNS, the Company received the First Tranche Price of USD400,000. The Company expects to receive the Second and Third Tranche Price in late July and August 2022 as agreed in the SPA. 

The Transaction Price implies a valuation of USD10.0 million for the Company's investment in Meize, which indicates a 22.0% premium to the carrying value as at the 30^th of June 2021 (USD8.2 million). The profit from this disposal is USD0.3 million.

This divestment, of which the sale consideration is settled offshore, marks the culmination of a lengthy and successful turnaround effort by the Company for private investment in China.

John Croft, Chairman of Jade Road commented : "Exiting private equity positions held in Chinese companies requires patience as well as persistence, but as demonstrated by this announcement, exits can be achieved, and in this case, at a premium to the value of the asset held in our books. Whilst having no direct connection with other privately held Chinese assets in our portfolio, it does provide clear evidence that these assets have real value and that in time realisations can be made delivering cash returns into the Company."

For further information on JADE, please visit the Company's website at  www.jaderoadinvestments.com   and follow the Company on Twitter (@ JadeFinance ).

FOR FURTHER INFORMATION, PLEASE CONTACT:

Jade Road Investments Limited	[phone]
John Croft
WH Ireland Limited - Nominated Adviser	[phone]
James Joyce
Andrew de Andrade
Hybridan LLP - Corporate Broker	[phone]
Claire Noyce
Lionsgate Communications - Communications Adviser	[phone]
Jonathan Charles

About Jade Road Investments

Jade Road Investments Limited is quoted on the AIM Market of the London Stock Exchange and is committed to providing shareholders with attractive uncorrelated, risk-adjusted long-term returns from a combination of realising sustainable capital growth and delivering dividend income.

The Company is focused on providing growth capital and financing to emerging and established Small and Medium Enterprises (SME) sector throughout Asia, well-diversified by national geographies, instruments and asset classes. This vital segment of the economy is underserved by the traditional banking industry for regulatory and structural reasons.

The Company's investment manager, Harmony Capital, seeks to capitalise on its team's established investment expertise and broad networks across Asia. Through rigorous diligence and disciplined risk management, Harmony Capital is dedicated to delivering attractive income and capital growth for shareholders with significant downside protection through selectively investing in assets and proactively managing them.

Harmony Capital is predominately sourcing private opportunities and continues to create a strong pipeline of attractive income-generating assets from potential investments in growth sectors across Asia, including healthcare, fintech, hospitality, IT and property. 

The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

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