Download STARLIGHT INT`L - Announcement

The Stock Exchange of Hong Kong Limited (the "Stock Exchange") takes no responsibility for
the contents of this announcement, makes no representation as to its accuracy or completeness
and expressly disclaims any liability whatsoever for any loss howsoever arising from or in
reliance upon the whole or any part of the contents of this announcement.
Starlight International Holdings Limited
(incorporated in Bermuda with limited liability)
Announcement
Acquisition of interest in shares in Cosmo
Communications Corporation
Starlight International Holdings Limited, through one of its wholly-owned subsidiaries, has
entered into an agreement (as amended) to acquire and to subscribe together approximately
89.2% of the then enlarged issued share capital of Cosmo Communications Corporation, a
company listed on NASDAQ, for an aggregate consideration of approximately US$1,050,683
(equivalent to HK$8,195,327).
The board of directors (the "Board") of Starlight International Holdings Limited (the "Company",
together with its subsidiaries, the "Group") would like to inform its shareholders and any
prospective investors that on 28th April, 2000 a wholly-owned subsidiary of the Company, has
entered into an acquisition agreement, as amended as of 13th July, 2000 (the "Agreement") with
Cosmo Communications Corporation ("Cosmo") and Messrs. Carlos Ortega, Amancio Victor
Suarez and A.J.Suarez, the principal shareholders (the "Principal Shareholders") of Cosmo.
Cosmo is a corporation incorporated in the United States of America whose shares are listed on
the NASDAQ stock market.
Pursuant to the Agreement, the Group will acquire 1,347,420 shares (the "Vendor Shares") in
Cosmo from the Principal Shareholders for an aggregate consideration of approximately
US$50,683 (equivalent to HK$395,327), representing a price of approximately US$0.037615 per
share (equivalent to HK$0.293397 per share). As at the date of this announcement, Cosmo has
1
Starlight International Holdings Limited – Announcement
Acquisition of interest in shares in Cosmo Communications Corporation
(19th July, 2000)
approximately 2,642,000 shares issued, and the Vendor Shares represent approximately 51% of
the issued share capital of Cosmo. Completion of the acquisition of Vendor Shares is expected to
occur on or before 31st July, 2000. Further, subject to the approval of the shareholders of Cosmo
at their forthcoming general meeting which is expected to be held in or around the end of
September 2000, the Principal Shareholders have agreed to procure Cosmo and Cosmo has
agreed to issue approximately 26,585,008 new shares (the "Subscription Shares") in Cosmo for
subscription by the Group at an aggregate consideration of US$1 million (equivalent to HK$7.8
million), representing a price of approximately US$0.037615 (equivalent to HK$0.293397) per
share. The Vendor Shares and the Subscription Shares will together constitute approximately
89.2% of the then enlarged share capital of Cosmo. Subject to the then prevailing market
conditions, the Group may consider to place down its ownership in Cosmo after the completion
of the acquisition of Subscription Shares.
The Agreement will not constitute a notifiable transaction for the Company under the Rules
Governing the Listing of Securities on the Stock Exchange. The Group will finance the proposed
acquisition of interest in shares in Cosmo through its internal resources. Completion of the
acquisition of Vendor Shares is not subject to any condition and completion of the acquisition of
the Subscription Shares is subject only to the obtaining of the approval of the shareholders of
Cosmo. Notification of the change of control of Cosmo's ownership will be made to the U.S.
Securities Exchange Commission following the Group's acquisition of the Vendor Shares.
The Group is principally engaged in manufacturing, marketing and distribution of consumer
electronic products worldwide. The Group's products are marketed through its own-label and
also through OEM channels. The Group's major products include, inter alia, MP3s, televisions,
CD players and other audio visual equipment.
Cosmo has commenced operation for over 15 years and is currently principally engaged in the
importing, marketing and distribution of consumer electronic products primarily in the United
States of America and Canada. Cosmo's major products include televisions, VCRs, electronic
clocks, clock radios and combination products such as clock radio telephones.
Following completion of the acquisition of Cosmo, the Board envisages that strong synergies
will occur, in particular, within areas of sales, marketing and distribution of the Group's products.
Furthermore, the Board believes that such an acquisition will enhance the shareholders' value of
the Group by allowing the Group to indirectly access the US equity capital markets, which may
provide for higher equity valuation and liquidity. The intention of the Board to utilise the US
equity capital markets may, or may not, necessitate the Group to proceed with a group
restructuring of its management, operations, assets and liabilities in this regard. The Board
2
Starlight International Holdings Limited – Announcement
Acquisition of interest in shares in Cosmo Communications Corporation
(19th July, 2000)
considers that the acquisition represents a good opportunity to progressively vertically integrate
further into the consumer electronic retail markets in both the United States of America and
Canada, where the Group has demonstrated a proven amount of success in supplying certain
major retailers.
Made by the order of the Board, the directors of which individually and jointly accept
responsibility for the accuracy of this announcement.
By order of the Board
Lau Sak Hong, Philip
Chairman
Hong Kong, 19th July, 2000
Note: Exchange rate used US$1 = HK$7.8
"Please also refer to the published version of this announcement in the Hong Kong i-mail"
3
Starlight International Holdings Limited – Announcement
Acquisition of interest in shares in Cosmo Communications Corporation
(19th July, 2000)