HK-listed Amax International Holdings Ltd has announced it has entered into an agreement to sell its entire stake of its investment holding company, Le Rainbow.
According to a filing to the Hong Kong Stock Exchange, the company will be sold to “a merchant in the PRC,” one Weizhang Zeng.
The consideration for the sale share is HK$1,000, which will be satisfied by cash and completion will take place on or before June 10, 2016, subject to all of the conditions being fulfilled or waived.
Le Rainbow is a wholly-owned subsidiary of the company, and owns a 42.61 percent investment in LE-Guangxi, a company which is “primarily engaged in the provision of software, hardware, transmission network and distribution marketing service to Guangxi Welfare Lottery Issue Centre.”
Amax said the sale was due to “the unsatisfactory performance in the past years of Le Rainbow Group; and the unaudited consolidated net liabilities of Le Rainbow attributable to its owner of approximately HK$5 million as at September 30, 2015.
“The Group is principally engaged in investment holdings and investments in high-end niche gaming and entertainment related businesses,” said Amax chairman Ng Man Sun. “The directors have been continuously evaluating the current business strategies of the group with an aim to achieve the best use of its resources and improve its overall performance and diversify investment geographically. Given the loss-making position of Le Rainbow Group for the past two years, the directors consider the disposal allows the group to exit from subsidising the non-performing business of Le Rainbow Group and create a good opportunity for the group to restructure its strategic business position and focus its resources in pursuing development opportunities of the group’s existing businesses, inter alia, the Vanuatu gaming business.