According to the Zhitong Finance App, China Merchants Port (00144) issued an announcement. According to the shareholders' agreement, FCGL (a wholly-owned subsidiary of the Company), Access Engineering and SLPA set up a project company (SACL) to implement the SACLH project, and in accordance with the BOT agreement, a “construction-operation-handover (BOT)” model was adopted to implement the SACLH project.
According to SACL's audited financial statements as of December 31, 2025, SACL shareholders have invested a total share capital of US$37.14 million (equivalent to approximately HK$290 million) in the SACLH project, of which FCGL, Access Engineering and SLPA have invested US$26 million (equivalent to approximately HK$203 million), US$5.57 million (equivalent to approximately HK$43 million) and US$5.57 million (equivalent to approximately HK$43 million) in cash, respectively.
The board of directors announced that the contracting party has agreed not to proceed with the SACLH project, so FCGL, Access Engineering, SLPA and SACL have agreed to enter into a settlement agreement (settlement agreement) to immediately terminate the shareholder agreement, BOT agreement, and venue lease agreement (termination) in an early and orderly manner from the date of the settlement agreement, and resolve all matters relating to the SACLH project by the contracting party.
According to the settlement agreement, SLPA agreed that SACL shareholders had invested US$26 million (equivalent to approximately HK$203 million) in the SACLH project and pay them to SACL shareholders in the manner specified in the settlement agreement after deducting taxes and overdue payment liabilities. SLPA has settled the VAT liability of US$3.9 million (equivalent to approximately HK$30.42 million) to the Sri Lankan Inland Revenue Authority and will take steps to settle the overdue payment liability of US$19.5 million (equivalent to approximately HK$1.52 million) from the Sri Lankan Inland Revenue Authority. SLPA will make a one-time payment of US$219.05 million (equivalent to approximately HK$171 million) to SACL within 30 days from the date of the settlement agreement, and finally distribute 70%, 15%, and 15% to FCGL, Access Engineering and SLPA respectively.
Furthermore, the cash available for distribution in SACL's audited financial statements as of December 31, 2025 is approximately US$7.85 million (equivalent to approximately HK$61.23 million), which will be distributed to FCGL, 15% and 15% respectively within 30 days from the date of the settlement agreement.
FCGL, Access Engineering, and SLPA will take the necessary steps to remove the SACL or, if applicable, wind up the SACL in accordance with the agreed arrangements in the settlement agreement. Related costs and charges will be covered by FCGL, Access Engineering and SLPA at a ratio of 70%, 15%, and 15%.
In view of changes in the external environment for the development of the SACLH project, including the adjustment of the project implementation environment and schedule, and the commercial considerations of each contracting party, the Company has re-evaluated the SACLH project and believes that terminating the project is in the best interests of each contracting party.
After communicating with the local government, the contracting parties intend to sign a settlement agreement and agree to terminate the SACLH project in an orderly manner on the basis of “friendly negotiation and neutral treatment”. According to the terms of the settlement agreement, the funds invested in SACLH will be refunded, and the contracting party will be allowed to reach a comprehensive and final settlement on all matters relating to the SACLH project.