CONTINENTAL H (00513) plans to sell all shares of IQ Group for HKD 85 million, resuming trading on August 20.

CONTINENTAL H(00513) announced that on August 18, 2026 (after trading hours), the seller, Henghe Real Estate Development Limited (a direct wholly-owned subsidiary of the Company), and the buyer, CheerStay (BVI) Limited, along with the Company (as the seller's guarantor), entered into a sale and purchase agreement. Under this agreement, the seller conditionally agreed to sell the shares for sale (representing the entire issued share capital of the target company, Zhi Cai Group Limited) to the buyer and facilitate the transfer of the debt for sale to the buyer; the buyer also conditionally agreed to acquire the shares for sale and the debt for sale, for a total consideration of HKD 85 million (subject to adjustments as per the sale and purchase agreement). Upon completion, the target company will no longer be an indirect wholly-owned subsidiary of the Company, and its financial performance will no longer be consolidated into the Group's financial statements. The target company is primarily engaged in property holding and property development. Its main asset is a vacant redevelopment site located at 164 and 164A Koi Tai Street, Kowloon, Hong Kong, with a land area of approximately 5,054 square feet (the Property). The Board believes that, in the current uncertain macroeconomic environment and challenging property market conditions, the sale presents a good opportunity for the Group to liquidate its investment in the target company and the Property, and to avoid incurring further capital commitments related to the Property. In particular, the Board considers that proceeding with the sale at this stage is a prudent commercial decision, as any delays could expose the Group to ongoing market risks and cannot guarantee that the Group could liquidate the Property on the same or better terms in the future. The Board also noted that if the Group does not proceed with the sale, continued holding of the Property and any proposed redevelopment would require more time, capital, and financing commitments, including additional capital expenditure for land premium and other redevelopment costs. This could lead to further cash outflow and impose an additional burden on the Group's financial resources. Any redevelopment project for the Property would require a lengthy period, expecting cash flow to be realized approximately three years later. During this time, the Group will continue to face market uncertainties and execution risks. The Board has also taken into account that the planned redevelopment of the Property faces several uncertainties and challenges, including (among others) contract amendment procedures, land premium assessments, additional capital and financing needs, construction and execution risks, and market risks related to the property market and overall economic conditions. The sale allows the Group to realize its investment at this stage, reduce the uncertainties and risks associated with the Property's redevelopment, free up funds trapped in this project, and reallocate financial and management resources to other business operations and funding needs. Therefore, although the sale may lead to a loss for the Group, the Board believes that proceeding with the sale at this time will allow the Group to ensure timely exit to prevent incurring further capital and funding requirements related to the Property, and reduce the risk of less favorable terms for future liquidation. At the request of the Company, trading in the shares has been temporarily suspended on the Stock Exchange since 9:00 a.m. on August 19, 2026, pending the publication of this announcement. The Company has applied to the Stock Exchange to resume trading of the shares from 9:00 a.m. on August 20, 2026.