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Aoxin Q & M Dental Group's units enter agreements to acquire China premises
TWO of Aoxin Q & M Dental Group's subsidiaries have entered into a binding framework agreement to acquire a premise each in China from a relative of the group's chief executive officer.
The purchase amount for the first property works out to around 10.25 million yuan (S$2.04 million) and for the second, 8.67 million yuan.
Both properties are in Shenyang in Liaoning province, and were acquired from Shao Li Hua, who is the sister of CEO Shao Yongxin. Dr Shao Yongxin is deemed to have an interest of 28.67 per cent in Aoxin Q & M Dental Group. As such, the proposed acquisitions will constitute as interested person transactions.
The first property, at 192 Danan St, comprises a shop unit on the first and second floors of a seven-storey building with a gross floor area of 477 square metres. Aoxin Q & M Dental's subsidiary has previously acquired the shop unit on the first and second floors of 190 Danan St and is currently occupying three shop units (including the property to be acquired) under a lease agreement with Mdm Shao and two other landlords under a 12-year lease arrangement. Aoxin Q & M Dental Group's subsidiary, Shenyang Aoxin Q & M Stomatology Hospital Co, has renovated and combined the four units into one big premise which is being used as a dental hospital.
The second property on Xita St comprises a shop unit on the first, second and third floors of a nine-storey building. Shenyang Heping Q & M Aoxin Stomatology Polyclinic Co is currently occupying the property, which has a gross floor area of around 420 sq m, under a lease agreement with Mdm Shao, as well as another shop unit of the building under a 12-year lease arrangement with another landlord. This premise is being used for its clinic business.
The group has engaged Cushman & Wakefield as an independent valuer to assess the market value of the properties. According to the reports, the market values are 8.82 million yuan and 7.62 million yuan respectively.
The company said: "The directors are of the view that the proposed acquisitions are in line with the group's goal to increase shareholders' value and are in the best interests of the group. The proposed acquisitions would mitigate the risks associated with the leased properties in the long run, such as early termination or non-renewal of the group's existing leasing arrangements and possible increase in rental expenses, and ensure the continuity of the operation of the group's business at a permanent location."
The counter closed at 22 Singapore cents on Thursday, up half a cent.