CTEH INC. announces its subscription results

CTEH INC. (“CTEH” or the “Company”, together with its subsidiaries, the “Group”), a leading air ticket consolidator, travel business process management service provider and travel products and services provider in Canada, announced the subscription results for its shares (the “Shares”) under the public offer (the “Hong Kong Public Offering”) and placing (the “International Offering”, collectively, the “Share Offer”). The Shares under the Hong Kong Public Offering have been over-subscribed by approximately 192.9 times. The final offer price per Share has been set at HK$0.36 per Share. Dealings in the Shares on the Main Board of The Stock Exchange of Hong Kong Limited (“SEHK”) is expected to commence on 28 June 2018(Thursday).

A total of 300,000,000 shares will be offered under the Share Offer (subject to the exercise of the Over-allotment Option). As the over-subscription in the Hong Kong Public Offering is more than 100 times, the reallocation procedure between the International Offering and the Hong Kong Public Offering has been applied, upon which 150,000,000 Shares, or 50% (subject to the Over-allotment Option) will be offered by way of International Offering while the remaining 50%, or 150,000,000 Shares, will be offered under the Hong Kong Public Offering. Based on the final offer price of HK$0.36 per Share, the net proceeds from the Share Offer to be received by the Company (after deducting underwriting commissions and estimated expenses in connection with the Share Offer) is estimated to be approximately HK$49.7 million.

CTEH intends to use these net proceeds for the following purposes: 1) approximately 27.0% or HK$13.4 million, will be used for business expansion of air ticket distribution, including developing tailor-made online booking platforms and mobile booking applications in simplified and traditional Chinese for ethnic agencies, setting up customer services for Mandarin and Cantonese speaking travel agents, opening two regional offices and upgrading the Company’s website; 2) approximately 13.9% or HK$6.9 million, will be used for expanding travel business process management business, which will be used for expanding business development team and purchasing service level management software; 3) approximately 13.5% or HK$6.7 million, will be used for upgrading information technology infrastructure and installing enterprise resource planning system; 4) approximately 2.4% or HK$1.2 million, will be used for advertising and promotion of the Company’s brand and products; and 5) approximately 43.2% or HK$21.5 million, will be used for repayment of our bank borrowings after Listing.

Lego Corporate Finance Limited is the Sole Sponsor. Lego Securities Limited is the Sole Global Coordinator and Joint Bookrunner, while Kingsway Financial Services Group Limited is a Joint Bookrunner and Joint Lead Manager. China Galaxy International Securities (Hong Kong) Co., Limited, Pacific Foundation Securities Limited, Future Land Resources Securities Limited and VMS Securities Limited are the Joint Lead Managers.

Mrs. Rita Pik Fong Tsang, Chairperson and Executive Director of the Group said, “We believe that the result of the Share Offer has affirmed market’s recognition of the Group’s business and confidence in our future prospects. Listing on the Main Board of SEHK enables the Group to further increase our market share in the respective business segments by expanding customer base. The Group will continue to implement marketing initiatives to enhance brand recognition and awareness.”

Ms. Annie Shuk Fong Tsu, Chief Executive Officer and Executive Director of the Group said, “We are honoured that investors have shown great support to the Group. CTEH is an innovative company that combines tourism and information technology together. Through more than 40 years of operating experience, the depth and breadth of our technical know-how and information technology capabilities enable the Group to maintain competitive position in the travel and tourism industry. Looking forward, we strive to upgrade our existing information technology system and continue to focus on operational efficiency, as well as to maximize returns of shareholders and investors.”