SUNWAY CITY BERHAD ("SUNCITY")
CLOSURE OF WONDERLAND SYDNEY THEME PARK, AUSTRALIA
ENTERING OF PUT AND CALL OPTION DEED WITH PACLIB INDUSTRIAL NO. 5 PTY LIMITED
The Board of Directors wishes to inform the Exchange that International Theme Park Pty Ltd ["ITP"] (a company incorporated in Australia), the operator of Wonderland Sydney in Australia will be closing its theme park operation latest by middle of this year. This decision was taken in view of persistent losses incurred and difficult market conditions.
Hartford Lane Pty Ltd ["Hartford"] (a company incorporated in Australia) had on 12 February 2004, entered into a Put and Call Option Deed with Paclib Industrial No. 5 Pty Limited ["PIPL"] to dispose off the property known as Wonderland Sydney, Wallgrove Road, Eastern Creek, New South Wales ["the Property"] to PIPL for a total consideration of A$52.5 million, excluding Goods and Services Tax [hereinafter referred to as "the Proposed Disposal"].
The Property consists of a land measuring 58.87 hectares (Lot 11, Plan 1025320) and buildings, structures and theme park rides thereon.
2. INFORMATION ON ITP, HARTFORD AND PIPL
ITP is a wholly-owned subsidiary of Estonia Enterprises Ltd which in turn is a wholly-owned subsidiary of Eastern Glory Enterprises Ltd. Eastern Glory Enterprises Ltd is a 60% owned subsidiary of Sunway Lagoon Sdn Bhd which is a 51% owned subsidiary of Suncity. Both Estonia Enterprises Ltd and Eastern Glory Enterprises Ltd are companies incorporated in the British Virgin Islands.
Hartford is a wholly-owned subsidiary of Eastern Glory Enterprises Ltd. Hartford being the Trustee of Sunway Australia Unit Trust ["SAUT"] is the registered owner of the Property. All the ordinary units issued by SAUT are held by Estonia Enterprises Ltd.
PIPL is a company incorporated in Australia and having its registered office at Suite 2, Level 1, 71 Epping Road, North Ryde, New South Wales 2113. PIPL is a special purpose vehicle with a paid-up share capital of A$2.00.
3. SALIENT TERMS OF THE PUT AND CALL OPTION DEED ("OPTION DEED")
3.1 In consideration of the Call Option fee of A$1.00 and the payment of the security amount of A$10,000,000/- ["Security Amount"], Hartford has granted PIPL or its nominee a call option to purchase the Property on the terms to be set out in the contract for the sale of the Property ["Contract of Sale"]. The Call Option period commences 3 months from the date of the Option Deed and ends on 9 December 2004.
3.2 In consideration of the payment of a Put Option fee of A$1.00, PIPL has also granted Hartford a Put Option to require PIPL to purchase the Property on the terms to be set out in the Contract of Sale. The Put Option period commences from 10 December 2004 and ends on 23 December 2004.
3.3 If neither the Call Option nor the Put Option is exercised, the Security Amount will be fully forfeited by Hartford.
3.4 If either option is exercised, the completion date for the Contract of Sale is set on 24 January 2005.
3.5 The Option Deed is governed by the laws of New South Wales, Australia.
4. RATIONALE FOR THE CLOSURE OF THE THEME PARK AND THE EXECUTION OF THE OPTION DEED
4.1 The closure of the theme park operation in Sydney is part of the Groupâ€™s overall rationalization exercise to exit from the non-performing business unit. In line with this objective, the Group intends to dispose off the Property.
4.2 The purpose of the Option Deed is to provide PIPL sufficient time to conduct its own independent due diligence exercise on the Property.
5. EFFECTS ON EARNINGS PER SHARE, NET TANGIBLE ASSETS PER SHARE, SHARE CAPITAL AND SUBSTANTIAL SHAREHOLDERSâ€™ SHAREHOLDING
The Proposed Disposal does not have any effect on the share capital and substantial shareholdersâ€™ shareholding of Suncity.
The Proposed Disposal is expected to have a positive impact on the earnings per share and net tangible assets per share of Suncity upon the execution and completion of the Contract of Sale.
6. APPROVAL REQUIRED
The Proposed Disposal does not require approval of shareholders of Suncity but is subject to approval of the relevant authorities in Australia.
7. DIRECTORSâ€™ AND SUBSTANTIAL SHAREHOLDERSâ€™ INTERESTS
None of the directors or substantial shareholders of Suncity or persons connected with them has any interest, direct or indirect, in the Proposed Disposal.
8. STATEMENT BY BOARD OF DIRECTORS
The Board of Directors of Suncity is of the opinion that the Proposed Disposal is in the best interest of the Group.