Information Memorandum
Disclosure of Information Concerning the Acquisition Disposition of Assets (Schedule 1)
Central Pattana Public Company Limited
The Board of Directors' meeting of Central Pattana Public Company Limited ("CPN") at its meeting No.4/2006, held on September 20, 2006, has approved the concept of leasing/ subleasing Shopping Complex (certain parts) and 2 Office Buildings (entrie parts) at Central Plaza Pinklao Project to CPN Retail Growth Property Fund ("CPNRF"), which can be summarized as follows:
1. The transaction date
* After obtaining approval from the Board of Directors, which is expected to be completed within February 2007.
2. The party involved and relationship with CPN
| * |
Leasor/subleasor: |
Central Pattana Public Company Limited. |
| * |
Leasee/subleasee: |
CPN Retail Growth Property Fund by TMB Asset Management Company Limited, the Management Company. |
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Relationship with CPN: |
CPN has invested in 33 percent of the total number of Investment Units issued and sold of CPNRF and acts as the Property Manager of CPNRF. |
3. The general characteristic of the transaction
| 3.1 |
Type of transaction: |
The transaction is categorized as class 2 transaction according to the Notification of the Stock Exchange of Thailand ("SET") Re: Rules, Procedures and Disclosure of Information Concerning the Acquisition and Disposition of Assets of Listed Companies. The value of the transaction is exceeding 15 percent but less than 50 percent of the total asset value of CPN, Baht 32,789,979,000 as of June 30, 2006. |
| 3.2 |
Characteristic of transaction: |
Lease/sublease 1 unit of shopping complex (certain parts) and 2 units of office buildings (entire parts) in the Central Plaza Pinklao Project for the period of approximately 18 years to CPNRF for the total price not exceeding Baht 6,934,920,000. The final price will not be higher than the lowest price obtained from the appraisal reports from at least 2 independent appraisers in excess of 20 percent according to the regulation of the Office of Securities and Exchange Commission of Thailand. |
In any case, the process on the above mentioned is subject to final approval of the lease/sublease price and other necessary conditions from the Board of Directors and CPN shall await the resolutions of the approval for capital increase and other related transactions concluded in the CPNRF's unitholder meeting (CPNRF informed that it would hold the unitholder's meeting on 8 December 2006.), approval from the Securities and Exchange Commission of Thailand including the results of the sale and allotment of the additional Investment Units. Thus, CPN will notify information to SET upon acknowledgement of final conclusion of the process on the above mentioned and obtaining resolutions from the Board of Directors of CPN. The process on the above mentioned is expected to be completed within February 2007.
4. Details of assets
* CPN will lease/sublease of the Central Plaza Pinklao Shopping Complex (certain part) and 2 units of Office Buildings, including parking area therein (proportionate to the utilization of area of the shopping complex and office buildings to be invested by the Fund) as well as the utilities systems in relation to the shopping complex, the office buildings, and the parking area. The total gross area to be invested by the Fund is approximately 190,236 square meters, accounted for 66.4 percent of total gross area of the project (excluding the Central Department Store which is owned by Thai Business Fund 3. The Long-term lease/sublease agreement will be expired on December 31, 2024.
5. The basis used to determine the value of transaction
* The value of lease/sublease shall not exceeding Baht 6,934,920,000.
6. The basis used to determine the value of transaction
* Determining by performing cash flow projection from the assets (using discounted cashflow approach) and the final price will not be higher than the lowest price obtained from the appraisal reports.
7. Expected benefit to CPN
* CPN expects to have adequate working capital for future developments in accordance to CPN's expansion plan and stronger financial position with higher liquidity as well as lower interest payment.
8. Plan for use of proceeds from disposition of the assets
* Proceeds from lease/sublease of the assets will be used for investment in additional Investment Units offered of CPNRF. The rest of the proceeds will be reserved for future developments in accordance to CPN's expansion plan. CPN is currently developing Chaengwattana and Pattaya Beach Projects.
9. Conditions of the transaction
* Since the transaction is categorized as Class 2 Transaction and value of the transaction is exceeding 15 percent but less than 50 percent of the total asset value, CPN is required to disclose information in regard of the transaction to the SET and submit the detail of such transaction to its shareholders within 21 days from the date of notification to SET.
10. The opinion of the Board of Directors
* The Board of Directors has an opinion that to lease/sublease of the assets to CPNRF will be beneficial to the Company as described in 7.
11. The opinion of the Audit Committee and/or Directors which is different from that of the Board of Directors
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