HONG KONG, Aug 22 (Reuters) - Building construction and property firm Paul Y Engineering Group Ltd (PYE) said it would buy a 50 percent interest in film joint venture Legendary East for $220.5 million, a deal to be funded by a proposed placing of new shares.
In a filing to the Hong Kong bourse late on Sunday, PYE said it would place shares at HK$0.65 each, raising net proceeds of about HK$2 billion to fund the acquisition and the remainder would be used for working capital.
The new shares would be placed to private equity firm AID Partners, and through UBS AG, to other institutional and professional investors.
Legendary East, the Asia arm of leading global filmmakers Legendary Pictures, also intends to establish a credit facility to fund film productions and operations, PYE said, adding it planned to reduce its exposure on its existing construction, civil engineering and property-related businesses.
On completion, PYE will hold 50 percent of Legendary East, Legendary East management 40.1 percent and Huayi Brothers International Ltd 9.9 percent.
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Shares of PYE were set to open 22.2 percent up on Monday.
Reporting by Donny Kwok; Editing by Jacqueline Wong