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(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 3311)
CONNECTED TRANSACTION
Formation of Joint Venture with
中國建築西南設計研究院有限公司
(China Southwest Architectural Design and Research Institute Corp., Ltd.*)
for the Jiangmen Project
On 9 April 2019, CSCIICL (a wholly-owned subsidiary of the Company), CSCIE (a wholly-owned subsidiary of the Company) and CSADRI entered into the Cooperation Agreement, pursuant to which the parties agreed to (a) form Jiangmen JV for the purpose of investing into the Jiangmen Project; and (b) regulate their respective rights and obligations in Jiangmen JV.
CSADRI is a subsidiary of CSCECL, which in turn is the intermediate holding company of the Company. Accordingly, CSADRI is a connected person of the Company and the Transaction constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules.
As one or more of the applicable percentage ratios calculated with reference to the Transaction exceed 0.1% but are less than 5%, the Transaction is subject to the reporting and announcement requirements but exempt from the independent shareholders' approval requirement under Chapter 14A of the Listing Rules.
INTRODUCTION
Recently, CSCIICL (a wholly-owned subsidiary of the Company), CSCIE (a wholly-owned subsidiary of the Company) and CSADRI formed a tender consortium (the "Tender Consortium") and jointly submitted a bid for the Jiangmen Project. The Tender Consortium was awarded the bid for the Jiangmen Project. Pursuant to the tender documents, (i) the Tender Consortium will enter into the PPP Project Agreement with the Relevant Local Government, and (ii)CSCIICL, CSCIE and CSADRI will form Jiangmen JV at the equity interest ratio of 89.99%, 10% and 0.01% respectively for the purpose of investing into the Jiangmen Project.
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Then, CSCIICL, CSCIE, CSADRI and Jiangmen JV will enter into the Succession Agreement with the Relevant Local Government in relation to the Jiangmen Project, pursuant to which Jiangmen JV will take over the rights and obligations of CSCIICL, CSCIE, CSADRI and Jiangmen JV under the PPP Project Agreement.
On 9 April 2019, CSCIICL, CSCIE and CSADRI entered into the Cooperation Agreement, pursuant to which the parties agreed to (a) form Jiangmen JV for the purposes of investing into the Jiangmen Project; and (b) regulate their respective rights and obligations in Jiangmen JV.
COOPERATION AGREEMENT
Date
9 April 2019
Parties
(a)CSCIICL, a wholly-owned subsidiary of the Company;
(b)CSCIE, a wholly-owned subsidiary of the Company; and
(c)CSADRI, a subsidiary of CSCECL, which in turn is the intermediate holding company of the Company.
Formation of Jiangmen JV
CSCIICL, CSCIE and CSADRI shall hold 89.99%, 10% and 0.01% equity interests in Jiangmen JV respectively. Jiangmen JV will be accounted for as a subsidiary of the Group.
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CSCIICL, CSCIE and CSADRI agreed to the following major terms concerning Jiangmen JV in the Cooperation Agreement:
Capital commitment | : | Registered capital of Jiangmen JV |
Jiangmen JV shall have a registered capital of RMB 100,000,000 (equivalent to approximately HK$116,279,070), which shall be contributed by the equity interest holders of Jiangmen JV in proportion to their respective equity interests in Jiangmen JV as follows:
CSCIICL | RMB 89,990,000 (equivalent | to | |
approximately HK$104,639,535) | |||
CSCIE | RMB10,000,000 | (equivalent | to |
approximately HK$11,627,907) | |||
CSADRI | RMB10,000 | (equivalent | to |
approximately HK$11,628) |
Project Capital of Jiangmen JV
Jiangmen JV shall have a project capital (exclusive of the registered capital of Jiangmen JV) of approximately RMB400,140,000 (equivalent to approximately HK$465,279,070), which shall be contributed by the equity interest holders of Jiangmen JV in proportion to their approximate equity interests in Jiangmen JV as follows:
CSCIICL | RMB360,090,000 | (equivalent | to |
approximately HK$418,709,302) | |||
CSCIE | RMB40,010,000 | (equivalent | to |
approximately HK$46,523,256) | |||
CSADRI | RMB40,000 | (equivalent | to |
approximately HK$46,512) |
The respective contribution to the registered capital and the project capital of Jiangmen JV is determined after arm's length negotiations between the parties with reference to the proposed capital requirements of the Jiangmen Project and the parties' interests in Jiangmen JV.
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Performance bond for construction by CSCIICL
CSCIICL (for itself and CSCIE) and CSADRI shall | ||||||||
provide a performance bond for construction in the | ||||||||
sum | of | RMB29,997,000 | (equivalent | to | ||||
approximately HK$34,880,233) and RMB3,000 | ||||||||
(equivalent | to | approximately | HK$3,488) | |||||
respectively to the Relevant Local Government | ||||||||
within 30 business days after signing of the PPP | ||||||||
Project Agreement in relation to the Jiangmen | ||||||||
Project. The performance bond shall have effect | ||||||||
from the effective date of the PPP Project | ||||||||
Agreement and up to the date on which the | ||||||||
Jiangmen Project has been completed and the | ||||||||
performance bond for operation and maintenance | ||||||||
of the Jiangmen Project having been submitted by | ||||||||
Jiangmen JV. | ||||||||
Board composition | : | The board of directors of Jiangmen JV shall | ||||||
comprise three directors and all of them shall be | ||||||||
appointed by CSCIICL. | ||||||||
Profit/loss sharing | : | The profits after tax and expenses in respect of | ||||||
Jiangmen JV shall be shared by CSCIICL and | ||||||||
CSCIE in proportion to their respective capital | ||||||||
contribution in Jiangmen JV. The losses after tax in | ||||||||
respect of Jiangmen JV shall be shared by | ||||||||
CSCIICL, CSCIE and CSADRI in proportion to | ||||||||
and up to their respective capital contribution in | ||||||||
Jiangmen JV. | ||||||||
Future financing | : | Any additional funding requirements of the | ||||||
Jiangmen Project (other than the registered capital | ||||||||
and the project capital) shall be arranged by | ||||||||
Jiangmen JV with banks or financial institutions. | ||||||||
Restriction on transfers | : | Neither CSCIICL, CSCIE nor CSADRI may | ||||||
transfer or assign all or any part of its equity | ||||||||
interest in Jiangmen JV without written consent | ||||||||
from the other parties. |
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OWNERSHIP STRUCTURE OF JIANGMEN JV
The chart below shows the ownership structure of Jiangmen JV upon its establishment:
CSCIICLCSCIECSADRI
89.99% | 10% | 0.01% |
Jiangmen
JV
INFORMATION ON JIANGMEN JV AND JIANGMEN PROJECT
Jiangmen JV is a joint venture company to be formed by CSCIICL, CSCIE and CSADRI for the purposes of project financing, investment, survey and design, construction, operation, maintenance and transfer of the Jiangmen Project.
The Jiangmen Project is a Public-Private-Partnership(PPP) project relating to the construction, operation, and establishment of infrastructure facilities in the Siqian Park (Pilot Zone) of the Equipment Manufacturing Park in Xinhui, Jiangmen Municipality, Guangdong Province, the PRC (江門市新會裝備產業園司前園區(啟 動區)基礎配套設施工程PPP項目). The total area of the entire Siqian Park is 10,248 mu (畝) (equivalent to approximately 6,832,000 square metres). The development of the Jiangmen Project will be divided into three phases. The area of the Pilot Zone of the Siqian Park is 4,000 mu (equivalent to approximately 2,666,667 square metres). The Jiangmen Project includes, but not limited to, the improvement and reconstruction of road networks, construction of a sewage treatment plant, sewage pipes and infrastructure facilities, greening, relocation of electricity cables, land levelling and requisition, and reconstruction of drainage pipes network.
Pursuant to the Cooperation Agreement, the construction period and the operation period for the Jiangmen Project shall be 3 years and not more than 15 years (varying with different sub-projects) respectively. The Tender Consortium will enter into the
PPPProject Agreement with the Relevant Local Government, pursuant to which the Tender Consortium will be granted a right for the management and operation of the Jiangmen Project. Then, CSCIICL, CSCIE, CSADRI and Jiangmen JV will enter into the Succession Agreement with the Relevant Local Government in relation to the Jiangmen Project, pursuant to which Jiangmen JV will take over the rights and obligations of CSCIICL, CSCIE, CSADRI and Jiangmen JV under the PPP Project
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China State Construction International Holdings Ltd. published this content on 09 April 2019 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 09 April 2019 17:32:06 UTC