Cathay Pacific 2001 Annual Report Download - page 26

24 Cathay Pacific Airways Limited Annual Report 2001
CONNECTED TRANSACTION
The following were connected transactions under the Listing Rules (Main Board) of The Stock Exchange.
On 25th February 2002, Maplebeck Limited, a wholly-owned subsidiary of the Company, acquired from Stabilo
Limited, a subsidiary of Shun Tak Holdings Limited (“Shun Tak”), their 25% interest in AHK Air Hong Kong Limited
(“AHK”) for an aggregate consideration of HK$194,000,000. AHK operates air cargo transportation services to Japan,
Korea, Europe and the Middle East. After the transaction, AHK became a wholly-owned subsidiary of the Company.
The Directors of the Company, including the independent non-executive Directors, confirmed that the consideration
and the terms of the Agreement were fair and reasonable and were of the best interests for the Shareholders.
In order to facilitate cash management, interest-free loans were made by AHK to its shareholders, being the Company
(75%) and Stabilo Limited (25%), amounting to HK$60 million and HK$20 million respectively on 16th October
2000. HK$40 million of the loans were repaid proportionally by AHK’s shareholders on 24th September 2001 with
the balance being fully repaid on 8th February 2002.
Shun Tak was a connected person of the Company as it had a 25% interest in the Company’s subsidiary AHK.
Stanley Ho and Andrew Tse, who were directors and shareholders of Shun Tak and Stabilo Limited, were connected
persons of the Company because they were directors of AHK.
MAJOR CUSTOMERS AND SUPPLIERS
6.3% of sales and 28.6% of purchases during the year were attributable to the Group’s 5 largest customers and
suppliers respectively. 1.8% of sales were made to the Group’s largest customer while 9.3% of purchases were
made from the Group’s largest supplier. HAECO is one of the Group’s largest suppliers.
DIRECTORS
All the present Directors of the Company whose names are listed on pages 20 to 21 served throughout the year.
In addition, Peter Sutch and Edward Scott also served as Directors of the Company during the year. Peter Sutch
resigned on 8th August 2001. It is with sadness that the Directors report the death of Edward Scott on 29th January
2002 and of Peter Sutch on 6th March 2002.
During the year, Peter Lee served as alternate director to H.C. Lee. Tony Tyler served as alternate director to Edward
Scott until 29th January 2002.
Article 93 of the Company’s Articles of Association provides for all the Directors to retire at the third Annual General
Meeting following their election by ordinary resolution. In accordance therewith, Martin Cubbon, James Hughes-
Hallett, Sir Adrian Swire and Raymond Yuen retire this year and being eligible, offer themselves for re-election.
No Director has a service contract with the Company which is not determinable by the employer within 1 year
without payment of compensation (other than statutory compensation).
Directors’ fees paid to the independent non-executive Directors during the year totalled HK$180,000; they received
no other emoluments from the Company or any of its subsidiaries.
CORPORATE GOVERNANCE
The Company has complied throughout the year with the Code of Best Practice as set out in the Listing Rules
(Main Board) of The Stock Exchange.
DIRECTORS’ INTERESTS
At 31st December 2001, the register maintained under Section 29 of the Securities (Disclosures of Interests)
Ordinance (“SDI”) showed that Directors held the following beneficial interests in the shares of the Company:
DIRECTORS’ REPORT