WISE ALLY INTL(09918) is selling 10% of its equity in TTL.

WISE ALLY INTL (09918) announced on February 10, 2025, that the seller, Lena Holdings (an indirect wholly-owned subsidiary of the company), and the company have entered into a sale agreement with the buyer, Ms. Zheng Huixian and TTL. The seller has conditionally agreed to sell, and the buyer has conditionally agreed to purchase, the sale shares (i.e. 10% equity interest in TTL) for a price of HK$730,000. Upon completion, the company will no longer hold any equity interest in TTL. TTL is a limited company registered in Hong Kong on June 26, 2020. TTL is mainly engaged in the development and sale of high-tech floor care products (including vacuum cleaners). TTL has entered into a license agreement with a licensor (a multinational corporation listed on the NASDAQ stock market), authorizing TTL to use the licensor's trademarks as a wholesale distributor in certain products in its daily business processes from August 26, 2020, to December 31, 2025. For various reasons, TTL has not met the group's original expectations to date. Since the investment in TTL was completed on March 22, 2022, TTL has faced unprecedented challenges mainly due to the combined impact of external economic factors and internal operational obstacles. The disruption of the supply chain caused by the COVID-19 pandemic has led to production and logistics delays, hindering TTL from launching its vacuum cleaner product line as planned. In addition, continued inflationary pressures and changes in consumer behavior have made the market situation volatile, making it difficult for TTL to stabilize. With weak global economic recovery, TTL has struggled to achieve sales targets and improve financial performance, resulting in continued net losses since its establishment on June 26, 2020. Faced with numerous challenges, there are different opinions and methods within the group on how to operate and manage TTL to overcome challenges. However, as a minority shareholder of TTL, the seller does not have definitive control over the management and operation of TTL. Considering the above factors, particularly TTL's weak financial performance and net indebtedness, the board is uncertain about TTL's short-term prospects. The sale of shares provides the group with an opportunity to realize its equity in TTL. The proceeds from the sale can be used for the group's general operating funds. In addition, the sale of shares will allow the group to streamline its investment portfolio and release management resources for allocation to strategic measures, enabling management to focus more on driving core business profitability and growth. Therefore, the board believes that the sale of shares aligns with the group's commitment to maximizing shareholder value through prioritizing investments with higher returns and lower risks to ensure long-term financial health.