Slaughter and May is advising S.F. Holding Co., Ltd. (“SF Holding”) (acting through its wholly-owned subsidiary Flourish Harmony Holdings Company Limited, the “Offeror”) on its pre-conditional voluntary partial offer to acquire 931,209,117 shares in Kerry Logistics Network Limited (“Kerry Logistics”) (representing approximately 51.8% of its issued share capital) at HK$18.80 per share, and its partial option offer to cancel 51.8% outstanding share options over shares of Kerry Logistics (the “Offers”).
The maximum amount of cash required to implement the Offers is approximately HK$17.6 billion (US$2.3 billion).
Conditional on the warehouses sale by Kerry Logistics, Kerry Logistics will declare a special dividend of HK$7.28 per share.
The pre-conditions to the Offers include, amongst others, those relating to CFIUS, a mandatory general offer that may be triggered for a Thai listed subsidiary of Kerry Logistics, PRC antitrust and other governmental approvals, shareholders’ approvals, SFC approvals for special deals (see below) and a Stock Exchange waiver for Kerry Logistics’s public float to be reduced to 15% (which has been obtained).
SF Holding is a leading integrated express logistics service provider in the PRC and is listed on the Shenzhen Stock Exchange. Kerry Logistics is principally engaged in integrated logistics, international freight forwarding and supply chain solutions, and has one of the largest distribution network and hub operations in Greater China and the ASEAN region.
In relation to the partial offer, SF Holding and the Offeror have entered into a shareholders’ agreement with certain controlling shareholders of Kerry Logistics, namely Kerry Holdings Limited (“Kerry Holdings”) and Kerry Properties Limited regarding corporate governance matters of Kerry Logistics. It is proposed that Kerry Logistics will sell its warehouses in Hong Kong to Kerry Holdings, and Kerry Logistics will provide warehouse management services in those warehouses to Kerry Holdings. Brand licence agreements are proposed in relation to the trademarks and right to use the Kerry names. Kerry Logistics also proposes the sale of its Taiwan business to Kerry Holdings. All of these would constitute special deals in relation to the partial offer under Rule 25 of the Takeovers Code, as well as (where applicable) connected and notifiable transactions under the Listing Rules.
Slaughter and May is also advising the Offeror on its certain funds financing for the cash required for the offers.
Adrian Chan / Legal Assistant, Florence Ha / Trainee, Adrien Yeung / Trainee, Adrian Mak / Trainee