24 December 2013, Hong Kong - Fantasia Holdings Group Co., Limited (“Fantasia” or “the Group”, SEHK: 1777) is pleased to announce that a wholly-owned subsidiary of Fantasia entered into share transfer agreement with TCL Corporation (“TCL”) and Hai Gu Zhou (“Hai Gu Zhou”) on the entire equity interest in and indebtedness of Huizhou TCL Real Estate Development Co., Ltd. (“Target Company”).  Upon the completion of the acquisition, the Target Company will become Fantasia’s wholly-owned subsidiaries and Fantasia will own the Target Company’s prime assets, including the projects in Huizhou and Wuhan as well as resources derived from future lands.  Meanwhile, Fantasia signed subscription agreement for Fantasia’s shares with a wholly-owned subsidiary of TCL.

Pursuant to the share subscription agreement, TCL conditionally agrees to subscribe for and Fantasia conditionally agrees to allot and issue the subscription shares for an aggregate consideration of approximately RMB960 million, at the subscription price of HKD1.4129 per share, representing a premium of 6.23% over the closing price on 23 December 2013. In addition, according to the transfer agreement, Fantasia acquires the entire equity interest in the Target Company owned by TCL and Hai Gu Zhou for an aggregate consideration determined by the net asset and liability of the Target Company. Meanwhile, Fantasia will pay an aggregate consideration of approximately RMB963 million on the transaction date and the remaining amount will be paid in the next three years by installments. 

Fantasia has been in pursuit of an opportunity to enter into Wuhan, and the entry marks Fantasia’s successful foothold set in another core second-tier city in China.  With many years’ sound operation in Huizhou, Fantasia has developed Special Town and Love Forever projects which have been well received in the local market. As of today, Fantasia has already expanded to 16 first-tier and second-tier core cities in China. Upon the completion of the acquisition, Fantasia will see an increase of GFA of approximately 1.20 million square meters in land bank.

In virtue of a listed-company platform and via collaboration with TCL, Fantasia has acquired quality land projects at low costs through issuing additional shares.  On one hand, the move will efficiently expand Fantasia’s real estate development scale, while on the other hand Fantasia is able to reduce its net debt ratio and maintain sound cash flow by issuing additional shares.  It’s estimated that the projects in Huizhou and Wuhan will generate impressive profit returns and cash flow for Fantasia in the next several years.  At the same time, the win-win cooperation and resources integration will further enhance Fantasia’s capability to acquire and develop land projects in China and lay a solid foundation for its real estate sales performance growth in 2014 and the coming years.

As a leading consumption electronics enterprise group in China, TCL is dedicated to bringing cheerful and touching experience to consumers, tallying well with Fantasia’s commitment to be the leading provider for interesting, tasteful and colorful living space and experience.  It’s believed that in the era of Internet big data, the two sides will have more cooperation in such fields as experience innovation and financial services.