Photo-Me, the instant-service equipment group, announces that the board of directors of Max Sight, of which Photo-Me is a substantial shareholder with approximately 18.33% ownership interest, as at the date of this announcement, has made an application to list Max Sight’s ordinary shares of HK$0.01 on the Growth Enterprise Market of the Hong-Kong Stock Exchange by way of a share offer (the “Share Offer”), with dealings expected to commence on 28 February 2018 (“the Listing”).
Max Sight is a leading automatic ID photo booth operator in Hong Kong, operating two iconic brands “Max Sight Photo” and “Fullwise Photo”, for ID photo booths in Hong Kong and the Guangdong Province in China, respectively.
Photo-Me has a business relationship with Max Sight of more than 24 years, beginning in 1993 when Max Sight began procuring photo booths from the Group for its business operation in Hong Kong.
On 9 July 2017, Photo-Me and Max Sight entered into a Master Supply Agreement, pursuant to which, Photo-Me agreed to supply at standard market terms photo booths and their respective consumables and spare parts to Max Sight, effective from the date of the Master Supply Agreement to 31 December 2019.
Max Sight intends for the majority of the proceeds from the Share Offer to be used to fund the long-term development of Max Sight in the Guangdong Province, with the vast majority of the proceeds to be used to expand and upgrade Max Sight’s network of photo booths. The net proceeds of the Share Offer are expected to amount to approximately HK$39 million, based on the mid-point of the indicative offer price range of the Share Offer.
Following the completion of the share offer, Photo-Me will hold approximately 13.75% of the total issued share capital and voting rights of Max Sight, as 200 million new shares are expected to be issued, hence it will remain a substantial shareholder of Max Sight. Photo-Me will not sell any of its shareholding at the time of the Listing and has committed to retain its shareholding for at least six months following the completion of the Share Offer.
In preparation for the Share Offer, Photo-Me’s interests in Max Sight Ltd and Fullwise Ltd were combined with certain other companies to form an enlarged group which is Max Sight. The accounting of the resulting reduction in the percentage of shareholding held by Photo-Me in Max Sight gave rise to an immaterial profit in Photo-Me accounts. The revaluation of the carrying value of the Max Sight investment in the Group’s consolidated balance sheet based on the mid-point of the indicative offer price range of the Share Offer, to £3.3 million, would lead to an unrealised revaluation gain of £3.0 million, which will be marked to market at every subsequent reporting date. Going forward, the Group has opted to recognise fair value revaluation gains and losses through the Profit and Loss statement.
NOTES TO EDITORS
Photo-Me International plc (LSE: PHTM) operates, sells and services a wide range of instant service vending equipment, primarily aimed at the consumer market.
The Group operates more than 47,300 vending units across 18 countries and its technological innovation is focused on three principal areas:
• Identification: photobooths and integrated biometric identification solutions
• Laundry: unattended laundry services
• Kiosks: high-quality digital printing
In addition, the Group operates vending equipment such as children’s rides, amusement machines and business service equipment.
The Group has built long-term relationships with major site owners and its equipment is generally sited in prime locations in areas of high footfall such as supermarkets, shopping malls (indoors and outdoors) and public transport venues. The equipment is maintained and serviced by an established network of 700 field engineers.
The Company’s shares have been fully-listed on the London Stock Exchange since 1962.