Geely Automobile Holdings Limited (Geely Auto) announced on May 29 it has signed an agreement with placing agents, pursuant to which the latter agreed to make their best efforts to have placees procure 600,000,000 placing shares at the price of HK$10.8 per share.
The placing shares represent roughly 6.51% of the current issued share capital of Geely Auto and approximately 6.11% of the company’s issued share capital as expanded by the allotment and issuance of the placing shares.
After deducting related fees and expenses, the gross proceeds and net proceeds to be collected from the placing are estimated to be around HK$6.48 billion and HK$6.447 billion respectively, assuming that the placing shares are issued in full under the agreement.
The net proceeds are scheduled to be applied for the company's business development and general working capital of Geely Auto and its subsidiaries (the group), said the company.
After the completion of the placing, Li Shufu, an executive director and a substantial shareholder of Geely Auto, and his associates will see the interest they hold decrease to 41.2% from 43.88%.
Geely Auto's board of directors considers that “the Placing represents an opportunity to raise capital for the company while broadening its shareholders and capital base in face of meeting dynamic challenges with uncertainties in the foreseeable future.” Besides, it also views that the placing would strengthen the group's financial position and offer it working capital.
The placing agents include Merrill Lynch (Asia Pacific) Limited, Goldman Sachs (Asia) L.L.C., the Hongkong and Shanghai Banking Corporation Limited, Morgan Stanley & Co. International Plc, and UBS AG Hong Kong Branch.
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