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UniVision Eng Ltd (UVEL)

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Monday 25 June, 2012

UniVision Eng Ltd

Sale of interest in Zhongshan Project

RNS Number : 0191G
UniVision Engineering Ltd
25 June 2012
 



25 June 2012

 

UniVision Engineering Limited

("UniVision" or the "Group")

 

Agreement for sale of the Group's interest in Zhongshan shopping mall project

and

Repayment of loan with Mayne Management Limited

 

Introduction

 

UniVision, the AIM listed Hong Kong based designer and installer of digital surveillance and integrated security systems, is pleased to announce that, on 22 June 2012, the Group, Guangzhou Hua Xin Trading Company Limited ("Hua Xin") and Guangzhou Jun Heng Mechanical and Electrical Equipment Company Limited (the "Investor") entered into an agreement (the "Agreement") for the sale of the Group's entitlement to a 51% interest in the Group's shopping mall project in Zhongshan, China (the "Zhongshan Project") for a consideration of RMB110 million (equivalent to c. £11.1 million and HK$134.1 million*) (the "Sale"). The key terms of the Sale are detailed below.

 

Background to the Zhongshan Project

 

The Group's wholly owned subsidiary, Leader Smart Engineering (Shanghai) Limited ("Leader Smart"), has been the main contractor responsible for interior design and installation for the Zhongshan Project which included the design, supply and commissioning of digital solutions, CCTV systems and electrical & mechanical works. As at the date of the Agreement, Leader Smart has fulfilled its contractual duties on the shopping mall. However delays to the completion of the Zhongshan Project have been encountered due to the developer of the shopping mall having applied to the local authorities for permission to add a further two storeys onto the shopping mall. Construction on the Zhongshan Project has, as a consequence, been on hold. Over the past 18 months the Group has been exploring ways of generating value from the Zhongshan Project including the possible sale of the Group's entitlement to their 51% interest in the Zhongshan Project against which Leader Smart's work on the Zhongshan Project had been secured.

 

The Group has an outstanding loan of US$3.97 million (equivalent to HK$31 million**) from its former major shareholder, Mayne Management Limited ("Mayne"). The loan from Mayne was made exclusively to finance the Zhongshan Project.

 

On 23 December 2011 the Group announced that they had received HK$6.17 million in cash (equivalent to c. RMB5 million at that time) from the Investor (the "Deposit") and that the terms of the Deposit were to be finalised between the Group and the Investor. In September 2011 UniVision and Hua Xin, an affiliate of the Investor, had entered into a memorandum of understanding in respect of the possible sale of UniVision's interest in the Zhongshan Project and, as announced, it was anticipated by the Board of UniVision that should discussions progress on the sale of the Group's interest in the Zhongshan Project then the Deposit would be deducted from the agreed sale price.

 

Terms of the Sale

 

The terms of the Sale are as follows:

 

-     The Deposit of HK$6.17 million from the Investor will be treated as a down payment on the Sale and deducted from the consideration payable to UniVision;

 

-     The Investor will, within three months from the date of the Agreement, repay to Mayne the outstanding loan of US$3.97 million (equivalent to c.HK$31 million**); and

 

-     The balance of HK$96.93 million will be paid to UniVision in cash, or other methods to be mutually agreed by the Group, Hua Xin and the Investor, by 22 December 2012.

 

Following completion of the Sale all rights to, or liabilities over, the Zhongshan Project will be transferred from UniVision to the Investor.

 

Further announcements will be made on the Sale as appropriate.

 

Stephen Koo, Chairman of UniVision, commented:

 

"I am delighted that the Group has, after many months of negotiations, been able to reach an agreement for the sale of the Group's interest in its shopping mall project in Zhongshan. The agreement which we have reached both settles the Group's outstanding liabilities to Mayne and will realise value from the asset for UniVision shareholders. Following completion of the Sale, UniVision will be released from significant indebtedness owed to its former shareholder and, on the basis of the final tranche of the consideration being settled in cash, will be well capitalised to take advantage of other opportunities in the CCTV and other sectors."

 

-ends-

 

 

For further information visit www.uvel.com or contact:

 

Univision Engineering Limited

+852 2389 3256

Stephen Koo, Chairman                    


Chun Hung Wong, CEO

Nicholas Lyth, Non-Executive Director

 

 

+44 (0) 7769 906 686

Allenby Capital Limited (Nominated Adviser/Broker)

+44 (0) 203 328 5656

Nick Athanas/James Reeve


*Based on the prevailing exchange rates of 1 RMB = 1.21909 HKD & 1 RMB = 0.100788 GBP as at 22 June 2012

**Agreed at the exchange rate of 1 USD = 7.8 HKD

 

 

Notes to Editors:

 

About UniVision Engineering Limited

UniVision was incorporated in Hong Kong in 1979 and is now established in Hong Kong, Macau and China. The Group designs, sources and sells its own brand-name products and OEM products including, Microprocessor CCTV Control Systems, Video Distribution Amplifiers, Fibre Optic Transmission Systems and Smart Card Access Systems.

 

UniVision currently offers hybrid security systems and has a portfolio of cutting edge digital technology used by its blue chip client base and the Hong Kong Government. UniVision is included in the Hong Kong Government's list of "Approved Suppliers and Installation of Video Electronics Equipment".

 

To date the Group has completed high profile projects for clients including Hong Kong International Airport, Tsing Ma Bridge Crossing, Mass Transit Railway, Shanghai Plaza 66 and Sydney CityRail Network selling its products through its distribution channels in China, Taiwan and other Asian countries.

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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