Service agreement concluded with Tencent-backed Linklogis for its blockchain-based supply chain financing platform, Followed by purchase of trade receivables through Qianhai Finanical Assets Exchange to tap cross-border fintech opportunities
HONG KONG – (ACN Newswire) – Success Dragon International Holdings Limited (“Success Dragon” or “the Company” together with its subsidiaries, “the Group”, 1182.hk) has announced the conclusion of two business agreements related to the Group’s new business direction, following the proposed change of its company name to ezBlock Capital International Holdings Limited last month.
On 26 October 2018, the board of directors of the Group (“the Board”) proposed the name change to better reflect the Group’s upcoming business direction. The Board considers that the proposed name change can promote and strengthen the Group’s corporate image and enable it to better identify and obtain opportunities for its future development into the fintech and blockchain business.
Following the proposed name change, the Group further announced the recent conclusion of two important business agreements:
1. Business development agreements with Linklogis
The Group has entered into agreements with Shenzhen Qianhai Linklogis Financial Services Company Limited* (“Linklogis”) and its subsidiary in early November 2018, to provide business development services for WeQChain, a supply chain financing platform built by Linklogis based on Tencent’s blockchain technology. The Group agrees to source businesses with the need of supply chain financing services in China and procure them and their suppliers to use WeQChain for financing the accounts receivables held by the suppliers.
The Group’s experience in business process management will be beneficial for Linklogis to expand its market share and maintain its leading position in the industry. The Group wishes to leverage on the strength, resources and expertise of Linklogis to develop its knowledge and experience in blockchain and fintech, diversify its business operations and strengthen its information technology services business, thereby enhancing the profitability of the Group’s business as a whole.
Shareholders of Linklogis include multinational companies and funds such as Tencent, CITIC Capital, Loyal Valley Capital, GIC Pte. Ltd., Bertelsmann Asia Investments, China Merchants Innovation Investment Management Limited Liability Company*, GLP, Skyworth, Oceanwide Investment* and Welight Capital. At present, the accumulated asset transaction scale of Linklogis amounts to nearly RMB30 billion, and it is in a leading position in the supply chain asset-backed securities field.
2. Agreement on cross-border purchase of trade receivables via Qianhai Financial Assets Exchange Company Limited (“QEX”)
The Group has been developing and implementing a blockchain application to identify and track assets with future payment obligations. As a step to implement the technology, the Board has approved the purchase of four trade receivables with a total size of RMB3.97 million by its wholly owned subsidiary (the “Purchase”). The Purchase is related to onshore trade receivables from an independent commercial factoring company in China and the debtor of these trade receivables is a wholly-owned subsidiary of a Chinese state-owned enterprise in the construction sector.
Scheduled to be repaid by the end of March 2019, the trade receivables will generate revenue in the form of interest. The Board believes the Purchase is suitable for testing the Group’s blockchain technology and will help it gain knowledge of China onshore trade receivable financing as a potential source of business diversification.
In order to develop the required cross-border channel for the Purchase and also for the acquisition of similar financial assets in the future, the Group’s subsidiary has entered into an agreement with QEX in this regard. QEX was established in Shenzhen and facilitates cross-border transactions of selected financial assets for offshore companies.
More information regarding the agreement can be found here:
Mr Roy Kwan, Chairman, Executive Director and CEO of the Group commented, “As mentioned in our latest annual report, we have been planning to apply technologies to complement and diversify our business operations and to strengthen our information technology services business. The two recently concluded arrangements not only demonstrate our determination to implement our plan to diversify into the fintech and blockchain businesses but also provide a solid foundation to capture opportunities in those businesses especially in the Greater Bay Area building on our presence in Hong Kong, Macau and Shenzhen.”
Success Dragon International Holdings Limited (1182.hk)
Success Dragon is a consolidated service provider of information technology and outsourced management solutions to various industries. Incorporated in Bermuda, the company is listed on the Hong Kong Stock Exchange, with headquarters in Hong Kong and offices in Macau and Shenzhen. The Group’s vision is to make customers successful and provide an excellent user experience for their end users while its mission is to become a leading information technology and outsourced management service provider and create value and growth for shareholders.
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