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| AHK Air Hong Kong Limited ("AHK") operates air cargo transportation services to Japan, Korea, Europe and the Middle East. It is owned 75% by Maplebeck Limited, a wholly owned subsidiary of Cathay Pacific Airways Limited ("Cathay Pacific"), and 25% by Stabilo Limited, a subsidiary of Shun Tak Holdings Limited ("Shun Tak").
Cathay Pacific considers that there are good business prospects in the air cargo transportation market and has therefore agreed to purchase, via its wholly owned subsidiary Maplebeck Limited, from Shun Tak its 25% interest in AHK for an aggregate consideration of HK$194,000,000. Upon completion, AHK will become a wholly owned subsidiary of Cathay Pacific. This is a connected transaction under Rule 14.25(1) of the Listing Rules because of Shun Tak's 25% interest in AHK. Accordingly, this transaction will be included in the next published annual report and accounts of Cathay Pacific in accordance with Rule 14.25(1)(A) to (D) of the Listing Rules. |
Agreement dated 20th February 2002.
Parties
Purchaser: Cathay Pacific Airways Limited ("Cathay Pacific")
Vendor: Shun Tak Holdings Limited ("Shun Tak")
Interest acquired
25% of the issued shares of AHK Air Hong Kong Limited ("AHK"), which operates air cargo transportation services to Japan, Korea, Europe and the Middle East. After this transaction, AHK will become a wholly-owned subsidiary of Cathay Pacific.
Consideration
HK$194,000,000, a price negotiated at arm's length, representing a consideration of HK$8.56 per share.
The Directors of Cathay Pacific, including the independent non-executive Directors, consider that the consideration and the terms of the Agreement are fair and reasonable and are in the best interests of the shareholders.
Payment terms
On completion in cash.
Funding
The consideration will be funded from Cathay Pacific's working capital.
Completion date
25th February 2002.
Cathay Pacific considers that there are good prospects in the air cargo transportation market and therefore the acquisition of the outstanding 25% interest in AHK will be of benefit to its shareholders. The Agreement is not subject to conditions.
Connection between the parties
Shun Tak is a connected person of Cathay Pacific as it has a 25% interest in AHK which is a subsidiary of Cathay Pacific. Stanley Ho and Andrew Tse, who are directors and shareholders of Shun Tak and Stabilo Limited, are connected persons of Cathay Pacific because they are directors of AHK.
Information for shareholders
This transaction will be included in the 2001 annual report of Cathay Pacific in accordance with Rule 14.25(1)(A) to (D) of the Listing Rules.
By order of the Board
P.A. Moore
Secretary
Hong Kong, 20th February 2002.
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