According to the latest data from the Hong Kong Stock Exchange, a significant share transfer occurred in REDCO HEALTHY (ASX: 02370) on July 2nd. The total value of shares transferred was HK$52.33 million, accounting for 24.01% of the company's issued share capital. A company shareholder transferred 48 million shares to Fuzhong Securities, while 48 million shares were transferred out from DBS Bank.
Recently, REDCO HEALTHY issued an announcement regarding the appointment of a receiver over 75% of the company's issued shares. On December 31, 2025, the company received a letter from Mr. Li Yinglin, the receiver appointed over 150 million pledged shares (equivalent to 75% of the company's total issued shares). These shares were pledged as security for debts owed by the company's controlling shareholder, REDCO Properties Group Ltd.
On May 23, 2026, the company was informed by REDCO Properties that it had received a letter from the receiver. The letter stated that, despite the receiver's ongoing marketing efforts, no viable commercial offers had been received for the pledged shares due to the financing remaining in default. The letter specified that Sino Man International Limited, as the sole registered lender under the financing, had proposed to acquire 48 million ordinary shares (the Target Shares), representing 24% of the company's issued share capital, for a consideration of HK$45.12 million.
This consideration was to be settled in a non-cash manner, through partial offset against the outstanding amount of the financing owed by REDCO Properties. The price was calculated with reference to the closing price of HK$0.94 per share on the Hong Kong Stock Exchange on May 15, 2025.
After considering factors including the continuing default by REDCO Properties, the lack of any viable commercial offers for the pledged shares despite ongoing marketing efforts since the receiver's appointment, and the proposed sale terms, the receiver issued a formal notice to REDCO Properties. The notice stated that unless, by the close of business on May 26, 2026, (i) REDCO Properties procured a buyer willing to acquire the Target Shares for not less than HK$45.12 million, (ii) the outstanding financing was fully repaid, or (iii) REDCO Properties raised a reasonably justified objection, the receiver would deem REDCO Properties to have no objection to the sale. The receiver would consider the sale fair and reasonable under the circumstances and would proceed to execute the relevant transaction documents and implement the sale without further notice.
REDCO Properties indicated that it had since been negotiating with the lender, requesting a suspension of strict enforcement while continuing friendly discussions to seek viable alternatives. However, on May 22, 2026, the lender stated it would not grant any further repayment extensions to REDCO Properties unless repayment was made.
Given REDCO Properties' lack of financial resources to fully repay the aforementioned HK$45.12 million by May 26, 2026, it is expected that the receiver will dispose of the Target Shares to the lender by that date. Consequently, it is anticipated that the Target Shares (equivalent to 24% of the company's issued share capital) will be sold to the lender by May 26, 2026, to offset part of the financing owed by REDCO Properties.
If the above share sale occurs, REDCO Properties will hold only a 51% interest (instead of 75%) in the company's issued shares, and the lender will become a major shareholder of the company. According to an announcement issued by REDCO Properties on May 22, 2026, it stated there is no guarantee whether the receiver/lender will further dispose of the remaining pledged shares. If the receiver/lender seeks further disposal of the pledged shares, it may result in the company no longer being consolidated into the consolidated financial statements of REDCO Properties.
At this stage, the company cannot estimate the actual impact of the sale on its financial or business performance but does not expect it to have an immediate material adverse effect. The board of directors will continue to monitor the situation and has requested REDCO Properties to provide further updates on any developments regarding the relevant matters.
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