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 purposes 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 Government of the Hong Kong Special Administrative Region ("the 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, 1998, the bank loan obtained by Island Land under this loan facility amounted to $405.5 million approximately (1997: $158 million).
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.
Pursuant to the heads of agreement ("the fourth agreement") entered into between Swire Properties Limited and ICE on 22nd May, 1998, Uttoxeter purchased for redevelopment purposes a plot of land from the Government. In accordance with the terms of the fourth agreement, the cost of land and development costs are to be financed by shareholders' loans in proportion to the shareholders' respective holdings of ordinary shares. In May and June 1998, Uttoxeter paid the total premium of $1,677 million to the Government.
11. INVESTMENTS
The group
Investments listed in Hong Kong, at cost less provision
Market value of listed investments
12. CURRENT ASSETS
Stores and spare parts
Debtors, deposits and prepayments
Deposit with the Government
Short term deposits with banks Cash at banks and in hand
28
1998
1997
$000's
$000's
41
41
768
3,080
The group
The company
1998
1997
1998
1997
$000's
$000's
$000's
$000's
41,819
71,347
41,819
71,347
25,377
18,025
12,216
14,249
2,000
2,000
2,000
2,000
2,554,491
1,044,433
193,862
187,901
18,137
19,593
10,871
16,802
2,641,824
1,155,398
260,768
292,299
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