PAK TAK INT'L (ASX: 02668) has released an announcement regarding a planned divestiture. The company, acting as the seller, entered into a sale and purchase agreement with the buyer, Ming Yan Holdings Limited, on June 30, 2026.

Under the terms of the agreement, the company has conditionally agreed to sell, and the buyer (or its designated nominee) has conditionally agreed to purchase, the sale shares. These shares represent the entire issued share capital of the target company, Ling Chuang Limited.

The consideration for the transaction will be settled via a non-refundable deposit of HK$2 million payable by the buyer. In exchange for securing the release and discharge of a company guarantee, the company will issue an acceptance note with a principal amount of HK$100 million to the buyer (or its nominee). No cash payment is required from the buyer to the company upon completion.

The target company is primarily engaged in investment holding. Following a restructuring, it will directly and indirectly hold the entire issued share capital of 16 subsidiaries. These subsidiaries are principally involved in hotel management and catering services, property investment, supply chain operations, and leasing businesses.

The board of directors is continuously evaluating the group's current business strategy, aiming to optimize resource utilization and enhance overall performance, while taking proactive steps to strengthen cash flow.

The target group's main activities are in hotel management and catering services, property investment, leasing, and certain non-core supply chain operations. These businesses are not closely aligned with the company's core strategic direction.

In line with the company's strategy to focus on its primary supply chain business—which includes iron ore mining and processing—and to systematically exit non-core or underperforming assets, the target group has been designated for divestment.

Notably, as the company has faced claims due to a corporate guarantee, the proposed sale will effectively facilitate the release and discharge of these immediate financial obligations. This move is expected to mitigate imminent legal and financial risks, thereby safeguarding the group's overall assets.

After considering several factors, including the target group's historical financial performance, its existing debts and liabilities, the outlook for the relevant industries, and the opportunity for the group to eliminate the corporate guarantee and reduce financial risk, the board believes the sale presents a favorable opportunity. It allows the group to streamline its business portfolio, improve its financial position, and concentrate its resources on its core supply chain operations.