Winfoong to acquire Singapore property firm

Winfoong to acquire Singapore property firm

Danny Chung

Monday, May 28, 2007

Small developer Winfoong International (0063) is buying a Singapore property company from its controlling shareholder for S$22.24 million (HK$113.94 million).
Winfoong will pay S$4.68 million in cash and issue 900 million new shares for the remaining S$17.56 million.

The value of the new shares represents 60.3 percent of the existing share capital of the company and 37.6 percent of the enlarged issued share capital. The issue price is 10 HK cents, representing an 87.7 percent discount to the closing price of 81 HK cents Friday.

The issue of new shares will boost the stake of the major shareholder, Singapore-listed Hong Fok Corp from 40.7 percent to 63 percent.

The property company being sold, Goldease Group, is engaged in property development and holds several Singapore buildings.

These are 11 flats at Balmoral Park and four flats at Suffolk Road with an average total monthly rental income of HK$155,000 last year.

"The board considers that the acquisition provides the group with a good opportunity to expand and diversify its property investment portfolio into the overseas market," chairman Patrick Cheong Pin- chuan said in a stock exchange notice.

Apart from buying the entire issued share capital of Goldease, the deal also includes acquiring a loan of not more than S$33.2 million.

The company posted a 31 percent increase in net profit attributable to shareholders for the year to the end of December that was due mainly to a near sixfold rise in share of profits from an associate of HK$178 million.

The company focuses mainly on property leasing, development and horticultural services.

It is redeveloping an investment property at 38 Conduit Road, which is expected to be completed in 2009.