(Alliance News) - Zibao Metals Recycling Holdings Ltd said Friday it has agreed to sell its main subsidiary, Masterpiece Enterprises Ltd to APC, a company owned by Chair Wenjie Zhou for GBP102,760.
In addition, following the disposal, Zibao is intending to reorganise its share capital, conduct a placing and share buyback, and then change its name as the company becomes an AIM cash shell.
Zibao will sell Masterpiece to Zhou for GBP102,760 in cash, which will be facilitated through a mass reorganisation of its shares.
Zibao's first step will be a capital reorganisation, where each existing ordinary share will be sub-divided into one ordinary share and one new deferred share.
Following the reorganisation, Zibao will have 122.0 million ordinary shares, and the same number of deferred shares, that will not be cancelled, but neither will they be admitted to trading on any market.
The next step will be a placing, for which the company has appointed SI Capital Ltd to raise GBP352,760 through the issue of 1.36 billion shares at a price of 0.026 pence each.
Of the proceeds, GBP102,760 will be used by the company to buyback shares from Zhou, which the chair will use to fund the acquisition of Masterpiece.
After the placing and buyback, Zibao's 1.38 billion shares will be consolidated on a basis of 40 existing shares to one new share, bringing its entire share capital to 34.4 million shares overall.
Finally, Zibao has proposed the changing of its name to Phimedix PLC. All of these changes are conditional on gaining shareholder approval at an upcoming general meeting on March 9.
Should the resolutions be approved, Zibao will become an AIM cash shell under a new name, where it will have a deadline of six months to make an acquisition constituting a reverse takeover before its shares are suspended from trading.
Shares in Zibao Metals Recycling - which is based in Hong Kong - were up 7.1% at 0.48 pence on Friday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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