Put & Call Options Agreement
28/03/2008 7:01am
UK Regulatory
RNS Number:9692Q
Cosmedia Group Holdings Limited
28 March 2008
Cosmedia Group Holdings Limited
Put and Call Options Agreement Extension
Cosmedia Group Holdings Limited ("Cosmedia" or the "Group"), the AIM listed
Chinese advertising and media group, announces that it has extended the term of
the agreement with Stanley Kit Pong, Executive Chairman and indirect major
Shareholder of the Company, providing for a put and call option over ordinary
shares entered into on 13 December 2006 (the "Put and Call Options Agreement").
Under the terms of the put option, Mr. Pong agreed to grant to the Company the
right to require him (upon termination of certain banking facilities of the
Company) to subscribe for ordinary shares of US$0.10 each in the Company
("shares"), in return for which the Company granted to Mr. Pong the right to
subscribe for shares in the Company, in each case at a price of US$2.85 per
share, and so that shares with an aggregate subscription price of up to
US$8,500,000 may be subscribed under the Put and Call Options Agreement. As
previously announced in March 2007, Mr. Pong has already exercised rights to
subscribe for 391,280 shares under the Put and Call Options Agreement.
The obligations of Mr. Pong to subscribe shares pursuant to such put option is
supported by a Letter of Credit provided by Mr. Pong, and the "Option Period"
will expire on 27 June 2008. With the approval of the Directors of the Company,
other than Mr. Pong who is involved in the transaction as a related party, who
deem it in the best interests of the Company and its Shareholders, the Company
has agreed to amend the Put and Call Option Agreements to extend the Option
Period for another year, to 27 June 2009, provided Mr. Pong concurrently extends
the Letter of Credit to that same date.
The Directors of the Company, with the exception of Mr. Pong who is involved in
the transaction as a related party, consider, having consulted with the
Company's Nominated Adviser, Collins Stewart Europe Limited, that such extension
of the Option Period is fair and reasonable insofar as the Company's
shareholders are concerned. In reaching its opinion, Collins Stewart Europe
Limited has relied on the Directors' commercial assessment.
For further information, please contact:
Cosmedia Group Holdings Limited
Stanley Pong/Antony Chan +852 2136 8222
Collins Stewart Europe Limited - Nominated Adviser to Cosmedia
Adrian Hadden +44 (0) 20 7523 8350
Catullus Consulting
Alex Mackey +44 (0) 20 7736 2938
+44 (0) 7773 787 458
Notes to Editors:
Cosmedia's business
* Foreign ownership of television and broadcasting channels in China is not
permitted and all such Chinese channels are state-owned and operated under
the supervision of the Chinese government. Cosmedia has established a
long-term relationship with China Great Wall Art and Culture Center
("Great Wall") a subsidiary of the Chinese State Administration of Radio,
Film and Television ("SARFT"), to act as exclusive advertising sales agent
to a Chinese television channel with nationwide broadcasting potential over
cable networks ("the Channel").
* Cosmedia generates revenue by selling the Channel's advertising airtime and
providing integrated solutions to advertisers such as programme title
sponsorship, product placement and product messages embedded in programmes,
and from television home shopping. In the future, Cosmedia will look to
generate new media advertising income and home shopping revenue through, for
example, co-operation with the Channel's dedicated website, wireless
operators and service providers.
Market overview
* Television is currently the largest media sector in China, both in terms of
its reach and influence. With the benefit of new technologies, the Chinese
television industry has grown and diversified, developing into a complex
network of satellite, cable, video-on demand and Internet-based service
providers.
* According to ZenithOptimedia, China's television market is the largest market
in the Asia-Pacific region, with 355 million television households
representing a penetration rate of 95 per cent as of 2004. Of these,
128 million are cable households. In 2005, ZenithOptimedia forecast that by
the end of 2007 total television households and cable households would
increase to 385 million and 164 million respectively.
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
END
AGRPUUCAWUPRGQM