Gelonghui, January 10 | Dexiang Real Estate (00199.HK) announced that on January 10, 2024, Beam Castle (an indirect wholly-owned subsidiary of the company) entered into the agreement with Ms. Yang (an existing shareholder of Premier Maker) as the buyer. Based on this, Beam Castle agreed to sell shares (equivalent to 49% of Premier Maker's total issued share capital) and sales loans at a cost of HK$50 million. Upon completion, the Group will no longer have any interest in Premier Maker Group.
Premier Maker's sole asset is all of Hengbang Investment's shares, and the company holds shares in Chinese companies. The main asset and business of a Chinese company is owning and operating this property.
The property is a 22-storey five-star hotel currently in operation under the name Renaissance Shanghai Caohejing Hotel. The property is located in Caohejing Emerging Technology Development Zone, Xuhui District, Shanghai, China. It is about 10 kilometers away from Hongqiao International Airport. Its total construction area is about 64,500 square meters, and consists of an area of about 39,200 square meters above ground and an area of about 25,300 square meters on two underground floors. The property includes approximately 380 guest rooms and other facilities such as a restaurant, ballroom, retail store and parking lot.
The directors believe that even if the COVID-19 epidemic is brought under control in 2023, the recovery path of the Chinese hotel property market is expected to be challenging due to high interest rates and the continued slowdown in the global economy, and the need to inject capital into the PremierMaker Group to support its working capital and financing costs is not ruled out, which will inevitably have an adverse impact on the Group's cash flow. Therefore, the directors believe that the sale will enable the Group to realise the bundled capital, and that cash payments from the sale will increase the Group's working capital and financial flexibility.