Notes on The Accounts (Continued)
10. INTEREST IN ASSOCIATED COMPANIES (Continued)
Pursuant to a shareholders' agreement ("the first agreement") entered into between Swire and Island and its shareholders on 6th November, 1991, Swire and Island purchased for redevelopment purpose two plots of land respectively from the company and its subsidiary, Island Communication Enterprises Limited ("ICE") for a total consideration of $980 million. In accordance with the terms of the first agreement, the cost of the land together with any subsequent modification premium thereon are financed by interest free shareholders' loans in proportion to the shareholders' respective holdings of ordinary shares.
Pursuant to a shareholders' agreement ("the second agreement") entered into between Island Land and its shareholders on 20th November, 1993, Island Land purchased for redevelopment purposes a plot of land from the company for a total consideration of $360 million. In accordance with the terms of the second agreement, the cost of the land together with any subsequent modification premium thereon are financed by interest free shareholders' loan in proportion to the shareholders' respective holdings of ordinary shares.
In February, 1997, Island Land paid modification premium of $430.23 million to The Hong Kong Government.
The other shareholder has provided a guarantee to a bank in respect of a loan facility of $520 million extended to Island Land. The company's subsidiary, Communication Holdings Limited has provided an indemnity to the other shareholder for fifty percent of this guarantee amounting to $260 million. As at 30th June, 1997, the bank loan obtained by Island Land under this loan facility amounted to $158 million approximately (1996: $ Nil).
Pursuant to a shareholders' agreement ("the third agreement") entered into between Hareton and its shareholders on 29th December, 1994, Hareton purchased for redevelopment purposes two plots of land from the company's subsidiary, Heartwell Limited ("HL"), for a total consideration of $383 million. In accordance with the terms of the third agreement, the cost of land is financed by interest free shareholders' loans in proportion to the shareholders' respective holdings of ordinary shares.
11. INVESTMENTS
Investments listed in Hong Kong, at cost less provision
Market value of listed investments
12. CURRENT ASSETS
The group
1997
1996
$000's
$000's
41
31
3,080
2,418
The group
The company
1997
1996
1997
1996
$000's
$000's
$000's
$000's
Stores and spare parts
71,347
67,736
71,347
67,736
Debtors, deposits and prepayments
18,025
22,619
14,249
18,429
Deposit with Hong Kong Government
2,000
2,000
2,000
2,000
Short term deposits with banks
1,044,433
807,948
187,901
266,076
Cash at banks and in hand
19,593
18,354
16,802
13,743
1,155,398 918,657
292,299
367,984
26