Media Release
21 June 2000
Signing of Joint-Venture Agreement
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The Board of the Company announces that APT Glory, a wholly-owned subsidiary of the Company, had entered into a shareholders agreement with SingaSat in relation to the formation of APT Telecom, a 55% indirect subsidiary of the Company, to engage in the business of external satellite-based fixed telecommunication network service in Hong Kong. For reasons set out below, SingaSat is a connected person for the purposes of the Listing Rules and accordingly, the entering into of the shareholders constitutes a connected transaction for the Company under Rule 14.25(3) of the Listing Rules. |
The Board wishes to announce that a shareholders agreement has been entered into with the major terms and provisions as follows:-
Joint Venture Agreement dated 21st June, 2000
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Parties: |
APT Satellite Glory Limited ("APT Glory"), a wholly owned subsidiary of the Company incorporated in Hong Kong with limited liability on 9th May, 1997 |
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SingaSat Private Limited ("SingaSat"), a company incorporated in Singapore with limited liability on 7th July, 1994 and is holding 2/7 of the issued share capital of APT Satellite International Company Limited ("APT International", which in turn is holding 51% of the issued share capital of the Company) APT Satellite Telecommunications Limited ("APT Telecom"), an indirectly 55% owned subsidiary of the Company incorporated in Hong Kong with limited liability on 9th February, 2000 |
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Shareholding: |
APT Glory: 55 shares of HK$1.00 each (55%) SingaSat: 45 shares of HK$1.00 each (45%) |
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Board Representation: |
APT Glory: 2 directors SingaSat: 2 directors |
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Capital requirements and profit sharing: |
Capital requirements and profits of APT Telecom will be shared by APT Glory and SingaSat in proportion to their respective equity interest in APT Telecom |
It is estimated that the total investment over the coming three years of APT Telecom will be upto HK$300million. APT Glory's share of the total investment will be approximately HK$165million. The shareholders agreement provides that APT Telecom shall be a stand-alone entity in terms of funding and financing and that all future funding requirements of APT Telecom shall as far as practicable avoid arrangements that require financial support from or recourse to the shareholders. In the case funding is required from the shareholders, it will be in proportion to their relevant shareholdings in APT Telecom and such funding will be financed by way of shareholders loan or subscription of new shares.
Business of APT Telecom
APT Glory and SingaSat agree that APT Telecom shall, or shall through its subsidiaries or vehicles be principally involved in the business of external satellite-based fixed telecommunication network services including very small aperture terminal (VSAT), facility management, Internet point of presence gateway and wholesale telecoms services under the external satellite-based fixed telecommunication network service licence, and facility management.
The shareholders agreement also contemplates the establishment of other vehicle by APT Glory and SingaSat when necessary. In such event, the Company will comply with the necessary requirement of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules").
Reasons for and benefits of the transaction
Through the operation of APT Telecom, the Company can further expand its scope of business from transponder leasing to telecommunication. The Company will also enjoy the synergetic effect arising from the joint effort and resources pooling together from the shareholders of APT Telecom.
Connected transaction
In order to facilitate the application for the external satellite-based Fixed Telecommunication Network Services licence from the Office of the Telecommunication Authority of Hong Kong to operate the international telecommunications business, SingaSat and APT Glory subscribed 45 and 55 shares of HK$1.00 each respectively in the share capital of APT Telecom at par value on 23rd February, 2000. Given that SingaSat is currently holding 45% interest in APT Telecom, the entering into of the shareholders constitutes a connected transaction for the Company pursuant to the Rule 14.25(3) of the Listing Rules.
Business of the Company
The Company and its subsidiaries are principally engaged in the provision of satellite transponder services for the broadcasting and telecommunications sectors in the Asian Pacific Region. The turnover of the Company for the year ended 31st December, 1999 was HK$482 million and the market capitalisation was HK$2.06 billion as at 21st June, 2000.
Business of SingaSat and its Parent
SingaSat is a wholly-owned subsidiary of Singapore Telecommunications Limited ("SingTel"), which is incorporated in Singapore and is principally engaged in the operation and provision of telecommunication systems and services and investment holding. The turnover of the SingTel for the year ended of March 1999 was S$4,883.5 million (approximately HK$21,927 million at the exchange rate of S$1.00:HK$4.49) and the market capitalisation was US$22 billion (approximately HK$171.6 billion at the exchange rate of US$1.00:HK$7.8) (as at 20th June, 2000). SingaSat is holding 2/7 of the issued share capital of APT International which in turn is holding 51% of the issued share capital of the Company.
Future Information
Further information on APT Telecom will be provided in a circular (with an advice from an independent financial advisor to be appointed) to shareholders to be despatched as soon as practicable.
By order of the BoardLo Kin Hang, Brian
Company Secretary
Dated: 21st June, 2000, Hong Kong
