GREEN ENERGY GP terminates its plastic recycling business and sells its processing plant and equipment in Germany

GREEN ENERGY GP (00979.HK) announced that its indirectly wholly-owned subsidiary EnviroAssets GmbH, as the seller, sold two plots of land with buildings to Hanse Prometheus GmbH for a real estate price of EUR 565,000 (approximately HKD 5.288 million) last Friday (20th).

Additionally, EnviroPlastics GmbH, which is 90% indirectly owned by the group, sold machinery and office equipment to Reva Polymers GmbH for an asset price of EUR 80,000 (approximately HKD 749,000).

The aforementioned real estate and assets consist of two plots of land located in Bünde, Germany, with areas of 3,602 square meters and 4,519 square meters, as well as industrial buildings and warehouses constructed on the land. The real estate was originally used by the group for business operations until the group terminated the operation of the processing plant last August to save costs. The assets include machinery and office equipment owned by the group.

As of February 28 this year, the total book value of the real estate and assets was approximately EUR 742,000 (approximately HKD 6.945 million).

The group indicated that, given the challenges and immense pressure facing the plastic recycling industry in Germany, its plastic recycling business has become increasingly difficult. Despite the group's efforts to maintain sales levels in a challenging environment, the overall market conditions remain extremely severe. In most cases, demand continues to be sluggish, with no signs of a sustained recovery.

In light of the ongoing poor performance of the business since its operation, the board reassessed its commercial viability last year and decided that the group should stop losses by selling the real estate and assets used for operating the business and terminating operations. The board believes that reallocating the group's resources to other more profitable business segments may provide greater sustainable growth potential and better returns for the company and its shareholders.

The board expects that, after deducting expenses and taxes directly related to the real estate sale, the net proceeds from the real estate sale will be approximately EUR 522,000 (approximately HKD 4.886 million); and after deducting expenses and taxes directly related to the asset sale, the net proceeds from the asset sale will be approximately EUR 74,000 (approximately HKD 693,000). The group will use the net proceeds from the above sales for general working capital.

The group expects to recognize an unaudited loss of approximately HKD 1.408 million from the real estate sale. The group expects to recognize an unaudited loss of approximately HKD 78,000 from the asset sale