Star East, a Hong Kong entertainment complex and Internet content company that is buying a stake in bankrupt restaurant operator Planet Hollywood International Ltd, has raised a total of HK$716 million since September 1999.
Star East, formerly DC Finance Holdings Ltd, has converted itself from a finance company into an entertainment website producer with links to several Hong Kong celebrities, with plans to create original content to be broadcast over the Internet.
"The global demand for TV-quality broadband content is expected to boost with the arrival and popularization of broadband Internet," said Rosanna Chau, a Star East executive director, in a statement.
Two of Star East's existing shareholders will sell 120 million new shares for HK$1.68 each. In return, they will subscribe for an equal number of new shares, 18 percent of the company, at the same price.
Of the HK$196 million in proceeds, Star East will use HK$50 million to outfit the studio, a reinforced concrete industrial building, for use by the company's movie and television production arm Bob & Partners Co.
The company will pay for the HK$150 million purchase price of the studio with HK$50 million in cash, to come from earlier share sales, and HK$100 million in convertible notes. The notes pay 5 percent interest a year for their two-year price, and are convertible into Star East shares for HK$1.68 per share.
Star East shares, which suspended trading on Friday afternoon, fell 5.4 percent today to HK$1.75 when they resumed trading. Paul Y-ITC rose 8.3 percent to 78 HK cents. Paul Y's parent, ITC Corp, owns a 16 percent stake in Star East.
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