REGAL INT'L (00078) subsidiary intends to sell 100% of the equity of Chasehill Limited.

REGAL INT'L(00078) announced that on 20th March 2026, the seller R-REIT Asset Holdings (Oriental) Limited has entered into a preliminary agreement with Rich Day (a wholly-owned subsidiary of REGAL REIT(018881)), the guarantor (in its capacity as trustee of REGAL REIT) and the buyer Li Tian Real Estate. The seller has agreed to sell, and the buyer has agreed to purchase the sole issued shares of the target company at the sale price; and the seller has agreed to transfer at the sale price (based on the agreed property value of Grand Hyatt Hong Kong of 1.518 billion Hong Kong dollars), and the buyer has agreed to accept the transfer of the sale loan. The target company is a wholly-owned subsidiary indirectly held by REGAL REIT through the seller, and it fully owns the target subsidiary, which is the sole registered legal and beneficial owner of several floor areas in Grand Hyatt Hong Kong and the adjacent Grand Hyatt Hong Kong City Bldg (excluding the properties). After completion, REGAL REIT will no longer hold any interests in Grand Hyatt Hong Kong, but will retain its interests in the excluded properties, which will be transferred to another subsidiary or affiliate of the seller before completion and will continue to be leased to existing tenants under a new lease agreement. The target company (Chasehill Limited) is an indirect wholly-owned subsidiary of REGAL REIT, mainly engaged in investment holding, and directly holds the target subsidiary (Carrie Hotel Limited). The target subsidiary is the sole registered legal and beneficial owner of Grand Hyatt Hong Kong and holds the hotel license. The target subsidiary is also the sole registered legal and beneficial owner of the excluded properties; the excluded properties are not part of the transaction and will be divested from the target subsidiary before completion and continue to be leased to existing tenants under a new lease agreement. After completion, the target company and target subsidiary will immediately cease to be subsidiaries of Century City, Benefit One, and Grand Fortune, and the financial performance of the target group will no longer be consolidated into the comprehensive financial statements of Century City, Benefit One, and Grand Fortune. The transaction provides REGAL REIT with an attractive opportunity to unlock and realize the value of mature properties. It aligns with the strategic goals of the trust manager, through disciplined capital management, asset recycling, and selective reinvestment to deliver long-term stable returns. Although the agreed price for Grand Hyatt Hong Kong in the transaction (i.e. the agreed property value) reflects a discount compared to the valuation, the expected value realized through the transaction is significantly higher than REGAL REIT's recent market-to-book ratio. The transaction will bring substantial net income proceeds to REGAL REIT, with most of it being used to reduce existing debt, and the remainder (subject to lender approval) for asset enhancement plans and meeting operational capital needs. After completion, REGAL REIT's debt ratio is expected to improve from approximately 42.8% to around 40.7%, enhancing its financial resilience and reducing refinancing risks in the current interest rate environment.