18 Mar 2011 15:30
18 March 2011
China Private Equity Investments Holdings Limited
("CPE" or the "Company")
The Company's principal activity is to invest in unlisted companies in the telecommunications, media, and technology (TMT) and financial services sectors
Strategic investment in leading online financial services company
The Board of CPE (AIM: CPEH) is pleased to announce that the Company has entered into an Agreement with Furuya Consultants Limited ("FCL") to acquire a 30% interest in Hong Kong-based Enfinium International Holdings Limited ("Enfinium"), a leading online financial services business, for a total consideration of US$6 million. CPE will pay for the acquisition by way of issuing 10 million new CPE Ordinary shares of no par value to FCL at a price of US$ 0.60 per share. The acquisition is conditional on approval by CPE shareholders at an EGM to be convened shortly to amend the Company's investing policy.
The issue of the 10 million new shares in consideration of the Agreement will give FCL 13.6% of the total issued share capital of 73,784,645 shares. In addition, under the terms of the agreement, CPE will issue an additional 2 million shares to FCL if Enfinium achieves a net audited post-tax profit of US$ 3.5 million or more for the year ending 31st December 2011.
The Agreement also gives CPE a seat on the Board of Enfinium, which will be taken up by CPE Chief Executive Officer Duncan Chui.
The acquisition is a strategic investment intended simultaneously to broaden CPE's exposure to online opportunities and provide direct access to Enfinium's global network of private equity investors. Established in 2007, Enfinium is 100%-owned by FCL. It provides its clients with a global online trading platform that allows them to trade stocks on most of the world's stock exchanges, along with forex, futures and other transactions. It has a wide network of High Net Worth investors who are seeking access to Chinese investment opportunities such as those sourced by CPE. For the twelve months ending 28 February 2011, Enfinium generated pre-tax profits of approximately US$2.5 million. As at 28 February 2011 the business had unaudited net assets of approximately US$3.5 million.
The new shares will be issued following shareholders' approval of the change to the Company's investing policy and are expected to be admitted for trading on the AIM market shortly afterwards. An EGM will be held in Hong Kong on a date to be announced shortly.
CPE Chief Executive Duncan Chui commented: "Following our announcement last November of a US$2 million strategic investment in China iEducation Group, this new Agreement marks a further important step forward for CPE, in line with our objectives of providing shareholders with an attractive return on their investment through capital appreciation.
"Based in Hong Kong, Enfinium taps into a wide global network of investors, many of whom have expressed serious interest in new China opportunities such as those sourced by CPE. In turn, we anticipate that CPE's public fundraising capabilities will assist Enfinium to extend its own expansion into a Chinese financial services market still undergoing rapid development against a backdrop of target GDP growth for 2011 of 7%."
CPE's currently-stated investment strategy is to provide shareholders with an attractive return on their investment through capital appreciation, by investing in businesses in China which the Directors believe are likely to achieve a trade sale or an IPO, predominantly within a medium to long term time horizon. A Hong Kong IPO is planned in the near future for CPE's significant investee company, Fortel Technology Holdings Limited, a digital media and technology services company operating primarily in China and in which the Company holds a 37% stake.
To broaden the investment opportunities further, the planned EGM will seek shareholder approval for amendments to the Company's investing policy to allow stake-holdings in businesses operating solely in China, operating in other countries as well as China but with significant exposure to the Chinese market, or operating outside China but positioned to leverage off CPE's experience to enter the Chinese market.
In addition to providing online trading platforms, Enfinium also offers a Corporate Advisory specialist consulting practice to help client investors pre-empt legislative, political and regulatory risks that can have material impacts on the success of transactions.
For further information, please visit www.cpe-invest.com or contact:
China Private Equity Investments Holdings Limited | +852 2801 6770 |
Duncan Chui / Ernest Wong | |
Shore Capital and Corporate Limited (Nominated Adviser) | +44 (0)20 7408 4090 |
Stephane Auton | |
Tavistock / First City Public Relations | |
Allan Piper | +852 2854 2666 |
Simon Hudson / Lydia Eades | +44 (0) 20 7920 3150 |
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