China Boon Holdings Limited Acquires Cemetery in Hangzhou to Further Expand its Cemetery Business
HONG KONG, July 6 /PRNewswire-Asia/ -- China Boon Holdings Limited (HKEx: 922, the "Company" or "China Boon") is pleased to announce that the Company has entered into agreement to acquire a cemetery project in Hangzhou at a total consideration of RMB105,468,750. After completion of the acquisition, the Company will also inject a further sum of RMB80,000,000 into the Project Company, of which RMB1,000,000 will be used to increase the registered capital of the Project Company from RMB5,000,000 to RMB6,000,000; and the remaining RMB79,000,000 will be treated as share premium. Total commitment involved in the acquisition is about RMB 185,000,000.
Among the total consideration, RMB15,000,000 will be paid in cash as part of the refundable deposit. Upon completion of the acquisition, the RMB8,000,000 will be paid by cash and the remaining RMB82,468,750 will be paid by the Company's issue of the consideration shares at HK$0.65 per share.
The Project Company is principally engaged in the business of developing and operating cemetery in Hangzhou, the PRC, key services include selling burial sites, designing tombstone according to customers' order and providing daily management to the cemetery. The Project Company owns land of approximately 647,715.1 square meters, among which, only 120,546 square meters had been developed for the cemetery which includes burial sites, green zone and accessories. It commenced business in year 2000 and has sold approximately 10,100 burial sites since then, which implies a scalable potential for further business development.
The acquisition comes with a expected profit, which the vendors have promised the Company that the audited net profit after tax prepared in accordance with PRC accounting standards for the years ending 31 December 2010 and 31 December 2011 shall not be less than RMB35,000,000 and RMB40,000,000 respectively. In case that the expected profit is not achieved, the Vendors shall pay the Company in cash an amount equal to the difference between the audited net profit and the expected profit on a dollar to dollar basis.
Commenting on the acquisition, Mr. Earnest Leung, CEO of the Company, said "this is the Company's second cemetery project acquisition in the PRC, following the cemetery in Shanghai. We believe China Boon could broaden its source of income by diversifying into such industry and the Company will be able to benefit from the earnings of the project. China Boon will continuously explore new opportunities to expand its cemetery business in major cities in the PRC."
About China Boon Holdings Limited
China Boon Holdings Limited is listed on the main board of Hong Kong Stock Exchange, stock code 00922.HK. China Boon is initially engaged in the trading of consumer electronic appliances, scrap metal and leather. China Boon is now diversifying into cemetery business in order to broaden its source of income.
SOURCE China Boon Holdings Limited
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