ART GROUP HOLD (00565) further acquires 6.87% equity interest in Edgeon for a consideration of approximately KRW 586 million

ART GROUP HOLD (00565) announces that, in relation to the acquisition of a 17.90% equity interest in Edgeon Data Co. Ltd (Edgeon). The Board is pleased to announce that the buyer and the seller have recently entered into a sale and purchase agreement (Sale and Purchase Agreement II), pursuant to which the buyer has agreed to purchase and the seller has agreed to sell 583,700 shares of Edgeon (representing approximately 6.87% of the issued share capital of Edgeon) for a consideration of KRW 586 million (equivalent to approximately HKD 2.929 million). As at the date of this announcement, the further acquisition has been completed, and the Group's equity interest in Edgeon has increased from approximately 17.90% to 24.77% immediately upon completion. The Board also announces that Edgeon has recently allotted and issued 5,852,100 new shares to one of its shareholders, representing approximately 40.78% of the enlarged issued share capital of Edgeon. The Share Issuance has resulted in the Group's equity interest in Edgeon decreasing from 24.77% to 14.67%, and constitutes a deemed disposal of a 10.10% equity interest in Edgeon. The Board considers the further acquisition as an extension of its property operation business and also the beginning of its data centre business, enabling the Group to provide premises and supporting services to customers through holding or leasing land and buildings, and to generate rental and service fee income therefrom. Immediately upon completion of the further acquisition, the Group's equity interest in Edgeon increased from approximately 17.90% to 24.77%. Accordingly, the Board considers that the further acquisition can maintain the Group's equity interest in Edgeon (especially in light of the equity dilution caused by the Share Issuance) and thereby maintain the Group's share of its profits, which is in line with the Group's planned strategy and development strategy. In respect of the Share Issuance, as Edgeon requires sufficient working capital to advance its projects, the Share Issuance is expected to improve Edgeon's cash flow and/or debt level, thereby supporting Edgeon's business operations.