HONG KONG, April 30, 2018 /PRNewswire/ -- Union Bridge Holdings Limited (the "Company"; OTCQB: UGHL) announced today that its subsidiary, Phoenix Creation Global Limited ("Phoenix"), has entered into a Letter of Intent with Shenyang Shenhe Yixi Home Care Service Center ("Shenyang Yixi") to enter into a joint venture (the "JV") to promote the development of the elderly care business in China, in which Phoenix would own 65% and Shenyang Yixi would own 35%.
Shenyang Yixi operates 12 community elderly day-care centers (elderly day-care centers or activity centers) and a district home-care service center (a home-based elderly care center to provide service to the elderly at home) in, which are owned by the government.
Shenyang Yixi has rented a building in Shenyang since 2016 to be renovated to operate as a nursing (elderly) care facility. The construction has been partially completed and partially paid for and is expected to be completed in first quarter of 2019. Shenyang Yixi would contribute this project to the new JV, which would complete the remaining construction work and operate the facility.
The parties estimate that the total remaining construction cost and rental expenses to be paid for the nursing care facility will be approximately RMB 31 million, and annual operation costs will be approximately RMB 8 million.
Shenyang Yixi would be responsible for the operation of the JV's nursing care facility. Phoenix would be responsible for providing or arranging the funding for the construction and rental costs.
Shenyang Yixi also agreed to contribute the business of the 12 community elderly day-care centers and the district home-care service center that it operates to the JV. Shenyang Yixi also expects that the JV may be granted by the government the right to operate at least 15 additional elderly day-care centers in Shenyang by the end of 2018.
The parties intend to conduct due diligence over a 60-day period and will endeavor to enter into a definitive agreement for the JV within 30 days after that.
Joseph Ho, Chief Executive Officer of the Company, said, "The investment in elderly care center in Shenyang is our first substantial investment and critical milestone in China market."
Forward Looking Statements
This Press Release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements concerning plans, objectives, goals, strategies, expectations, future events or performance and underlying assumptions and other statements which are other than statements of historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "would," "expect," "plan," "project," "anticipate," "estimate," "believe," or "think." Forward-looking statements involve risks and uncertainties which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. These risks and uncertainties include:
- Our due diligence review of Shenyang Yixi and the various facilities may not be be acceptable to us.
- We may not be able to successfully negotiate definitive agreements for the JV.
- The JV may not be able to obtain all necessary government permits for the facilities.
- We may not be able to obtain or arrange all necessary financing for development, construction and operation of the facilities on economic terms.
- The JV may not be given the right to operate any additional elderly day-care centers.
- The JV may not be able to successfully manage the development, construction and operation of the facilities.
Investors should carefully consider these risks and review the risk factor disclosure and other information, including the Company's financial statements and the notes thereto, set forth in the reports and other documents the Company files with the SEC available at www.sec.gov.
The Company assumes no duty to update or revise its forward-looking statements based on changes in plans or expectations or otherwise.
CONTACT: Jim Chim, +852-2468-3039, [email protected]
SOURCE Union Bridge Holdings Limited