FOUNTAIN SET (00420.HK): Proposes Acquisition of 81% Interest in a Vietnam Textile Company for USD 27,945,000, Constituting a Major Transaction

NewTimeSpace · 2026/09/09 18:32 · By Boyuan Chen

On 9 September 2026, Fountain Set (Holdings) Limited (00420.HK) announced that an indirect wholly-owned subsidiary proposed to acquire an 81% interest in a Vietnam textile company for a cash consideration of USD 27,945,000 (approximately HKD 219,089,000); the target's 100% equity was valued at approximately RMB 240,653,200 on an asset-based basis as of 30 April 2026, with consideration payable in three instalments; the acquisition constitutes a major transaction subject to shareholders' approval, with a circular expected by 31 October 2026.

NewTimeSpace News: On 9 September 2026 (after trading hours), Fountain Set (Holdings) Limited (stock code: 00420) announced that Ocean Textile Investment Pte. Limited (the purchaser), an indirect wholly-owned subsidiary of the company, had entered into an equity transfer agreement with the vendor, Lian-Ta-Hsing International Co., Ltd., the target company and a guarantor, pursuant to which the purchaser conditionally agreed to acquire an 81% capital contribution interest in the target company for a cash consideration of USD 27,945,000 (approximately HKD 219,089,000), with the remaining 19% to be held by persons designated by the vendor and approved in writing by the purchaser (the minority shareholders).

According to the announcement, the target company is a limited liability company duly incorporated in Tay Ninh Province, Vietnam, continuously engaged in knitting, dyeing and finishing and related textile product manufacturing, holding land use rights, fabric production plants, machinery and other facilities in the locality, with a registered capital of USD 36,000,000. The consideration was determined with reference to a valuation prepared on an asset-based basis of the target's core operating assets as of 30 April 2026 (excluding the assets and liabilities to be divested), under which the market value of the target's 100% equity interest was RMB 240,653,200 (approximately HKD 281,564,000). The consideration will be paid in three instalments: a 20% down payment (USD 5,589,000), a 60% completion payment (USD 16,767,000) and a 20% retention amount (USD 5,589,000). In addition, Mr. Kao Wen Cheng, a director of the vendor and/or the legal representative of the target, has provided a personal guarantee in favour of the purchaser with a term of ten years.

The company stated that the group is a leading integrated textile enterprise globally, and the acquisition will provide immediate access to a mature fabric production plant, equipment and workforce in Vietnam, rapidly increase its knitting, dyeing and finishing capacity, recover market share lost to the industry's supply chain shift to Southeast Asia, and leverage Vietnam's free trade agreements, textile industry chain and labour advantages to enhance its regional industrial chain footprint. As the highest applicable percentage ratio exceeds 25% but is below 100%, the acquisition constitutes a major transaction under Chapter 14 of the Listing Rules, subject to reporting, announcement, circular and shareholders' approval requirements. The acquisition is conditional upon shareholders' approval at an extraordinary general meeting, with a circular expected to be despatched on or before 31 October 2026.

NewTimeSpace Disclaimer: All content herein is the original work of NewTimeSpace. Any reproduction, reprinting, or use of this content in any other manner must clearly indicate the source as "NewTimeSpace". NewTimeSpace and its authorized third-party information providers strive to ensure the accuracy and reliability of the data, but do not guarantee the absolute correctness thereof. This content is for reference only and does not constitute any investment advice. All transaction risks shall be borne by the user.

Tags：

FOUNTAIN SET 00420.HK acquisition