董事会认为，配售事项为集团提供更高的流动性，使集团可透过减少银行借款金额及其相应融资成本加强其财务状况，从而降低集团的资产负债比率，此外，可动用资金增加使集团可扩大及发展其3C产品交易业务，而随着集团业务多元化，该业务为集团的发展重点之一。董事会亦认为，配售事项为集团的资本管理提供灵活性，因为发行可换股债券将不会对现有股东的股权造成即时摊薄影响，以及倘换股权获行使，则公司将获提供机会透过引入新投资者而扩大及多元化其股东基础。Ruicheng China (01640.HK) announced on November 4th, 2024, that the company has entered into a placement agreement with placement agents. According to this, the company proposes to submit for sale and subscription. The placement agents are required to encourage at least six (6) underwriters to subscribe to a maximum principal amount of 0.3 billion Hong Kong dollars of convertible bonds. The convertible bonds come with the right to be converted into conversion shares at a preliminary conversion price of HK$2.60 per share (a premium of approximately 1.56% over the closing price of HK$2.56 per share on November 4th).
Upon the conversion of the convertible bonds, the underwriters will receive a maximum of 0.115 billion shares of the converted shares, equivalent to approximately 20.60% of the existing issued share capital and approximately 17.08% of the enlarged issued share capital after the issuance of the converted shares.
Regarding the net proceeds of the placement, (i) approximately 210 million Hong Kong dollars are intended for the development of the 3C product trade business, of which (a) 150 million Hong Kong dollars will be allocated for overseas expansion; and (b) 60 million Hong Kong dollars will be allocated for the existing business in China; (ii) approximately 60 million Hong Kong dollars of the net proceeds from the placement are intended to repay bank loans; and (iii) the balance of approximately 29.66 million Hong Kong dollars of the net proceeds is intended for the group's general operating funds, including employee costs, rental expenses, and other office expenses.
The board of directors believes that the placement provides the group with higher liquidity, enabling the group to strengthen its financial position by reducing the amount of bank loans and their corresponding financing costs, thereby reducing the group's debt-to-asset ratio. In addition, the available funds increase the group's ability to expand and develop its 3C product trading business. As the group diversifies its business, this business becomes one of the key focus areas for the group. The board of directors also believes that the placement provides flexibility in the group's capital management, as issuing convertible bonds will not immediately dilute the equity of existing shareholders, and if the conversion rights are exercised, the company will have the opportunity to expand and diversify its shareholder base by introducing new investors.
The board of directors proposes at the upcoming special shareholders' meeting to change the company's English name from 'Ruicheng (China) Media Group Limited' to 'Qian Xun Technology Limited,' and to change the company's Chinese alternate foreign name from '瑞诚（中国）传媒集团有限公司' to '千循科技有限公司.'
