Meilleure Health International (02327) has announced that on September 21, 2026, after trading hours, the company entered into an agreement with the seller, Yucheng Industrial Limited. Under this agreement, the seller has agreed to sell, and the company has agreed to acquire through its wholly-owned subsidiary, Meilleure Group Development Limited, the sale shares representing the entire issued share capital of the target company, Dexin Pharma Development Limited, for a total consideration of HK$35.2 million. Upon completion, the company will indirectly hold the entire issued share capital of the target company through the subsidiary, making the target company an indirect wholly-owned subsidiary, with its financial results consolidated into the group's financial statements.
As of the announcement date, the target company's core asset is a property described as a Grade A commercial property located in Admiralty, Hong Kong, a prime business district within the city's central commercial area, featuring well-developed transport links and proximity to major financial institutions. The board believes that Grade A office properties in premium Hong Kong locations have demonstrated strong potential for long-term value preservation and appreciation, and this acquisition provides the group with a strategic opportunity to strengthen its asset base with quality commercial real estate.
The group intends to use part of the property for its own office purposes, which will enable the group to reduce its ongoing office rental expenses and provide greater operational stability, while leasing the remaining portion of the property to tenants will generate a stable and recurring rental income stream for the group. The directors consider that this acquisition aligns with the group's existing core property investment and leasing business, and will complement the group's current property portfolio, thereby enhancing the group's income diversification and long-term earnings visibility.
Furthermore, the directors noted that the consideration of HK$35.2 million represents a discount of approximately 43.9% compared to the HK$62.74 million consideration at which the group previously sold the target company in 2020. After considering the current conditions of the Hong Kong commercial property market and the latest valuation of the property, the directors believe that the consideration offers the group a favorable re-entry price to reacquire the target company and the property at a significant discount to the historical sale price, allowing the group to capture the value of the property at an attractive cost base.
In light of the above, the directors, including the independent non-executive directors but excluding Mr. Zhou Xuzhou and Ms. Zhou Wenchuan, who is an executive director and chief executive officer of the company and an associate of Mr. Zhou Xuzhou and abstained from voting on the board resolution due to their material interests in the acquisition, consider that the terms of the acquisition are on normal commercial terms, fair and reasonable, and in the best interests of the company and its shareholders as a whole.
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