Hong Kong Stock Exchange, 8/26/11
Chinese online video broadcasting and video advertising company VODone (0082.HK) has announced it is spinning off its mobile game development, operations, and distribution business and handset design business into a new subsidiary for a possible listing on an international stock exchange. The new company will remain a majority-owned subsidiary of VODone and its financial results will continue to be consolidated into VODone's accounts.
In the application, VODone requested the Stock Exchange, among other things, to grant a waiver for VODone and its subsidiaries (the “Group”) excluding the Mobile Game and Handset Design Businesses (the “Remaining Group”) from meeting the Listing Rules' minimum profit requirement as the Remaining Group incurred a loss for the year ended December 31, 2008 and would not have profit attributable to shareholders of more than HKD 30 mln in aggregate for the two years ended December 31, 2009. However, VODone was informed by the Stock Exchange in June 2011 that the Listing Division of the Stock Exchange, based on the information submitted by VODone at that time, was not able to grant the waiver. VODone is in the course of collating additional information which it will submit to support the application. VODone will continue to pursue the application and aims to complete the listing by the end of 2011.
VODone notes that in the event that the Proposed Spin-off and the Listing of Newco were to occur in 2012 after the publication of the 2011 full year results of the Group (on or before March 31, 2012), the 2008 Results will not be considered for the purpose of assessing the Remaining Group’s compliance with the minimum profit requirement of the Listing Rules as part of the application. As the Remaining Group had profit attributable to shareholders of more than the minimum profit requirement of HKD 30 mln in aggregate for the two years ended December 31, 2010, the company believes that provided that the Remaining Group can achieve profit attributable to shareholders of at least HKD 20 mln for the year ending December 31, 2011, the Remaining Group would be able to meet the minimum profit requirement of the Listing Rules, allowing the application to meet the compliance requirements of the Listing Rules.