3rd Apr 2008 07:00
Datang Intl Power Generation Co Ld03 April 2008 The Stock Exchange of Hong Kong Limited takes no responsibility for the contentsof this announcement, makes no representation as to its accuracy or completenessand expressly disclaims any liability whatsoever for any loss howsoever arisingfrom or in reliance upon the whole or any part of the contents of thisannouncement. DATANG INTERNATIONAL POWER GENERATION CO., LTD. (a sino-foreign joint stock limited company incorporated in the People's Republic of China) (Stock Code: 991) ANNOUNCEMENT CONNECTED TRANSACTION TRANSFER AGREEMENT The Board is pleased to announce that the Company entered into the TransferAgreement with CDC on 2 April 2008, pursuant to which the Company agreed totransfer its 35% equity interest in Lusigang Power Company to CDC at theconsideration of RMB108,450,000 (equivalent to HK$120.5 million). Uponcompletion of the Equity Transfer, the Company will own 55% equity interest inLusigang Power Company. CONNECTED TRANSACTION As at the date of this announcement, CDC held approximately 33.74% of the issuedshare capital of the Company. Accordingly, CDC is a connected person of theCompany under the Listing Rules and therefore the Equity Transfer constitutes aconnected transaction of the Company. As each of the applicable percentage ratio(as defined in Rule 14.07 of the Listing Rules) is more than 0.1% but less than2.5%, the Equity Transfer is only subject to the reporting and announcementrequirements under Chapter 14A of the Listing Rules and does not require theapproval by the independent shareholders of the Company. The Company willdisclose the relevant details in the next published annual report and accountsof the Company in accordance with the relevant requirements as set out in Rule14A.45 of the Listing Rules. TRANSFER AGREEMENT Date 2 April 2008 Parties to the Transfer Agreement Transferor: the Company Transferee: CDC Major Terms of the Transfer Agreement Interest to be transferred Pursuant to the Transfer Agreement, the Company agreed to sell and CDC agreed topurchase the Company's 35% equity interest in Lusigang Power Company. Consideration The consideration of the Equity Transfer is RMB108,450,000 (equivalent toHK$120.5 million) and has been determined by the arm's length negotiationbetween the parties after taking into account the valuation of Lusigang PowerCompany attributable to such 35% equity interest held by the Company as at 31January 2008, as conducted by an independent valuer. According to the afore-mentioned valuation, the assessed value of all of theequity interest of shareholders of Lusigang Power Company as at 31 January 2008was RMB309,860,000 (equivalent to HK$344.3 million). CDC agreed to pay the consideration of the Equity Transfer to the Company on alump-sum basis by way of cash within 30 days from the effective date of theTransfer Agreement. Conditions The Transfer Agreement will become effective on the date of fulfilling all ofthe following conditions:- (i) obtaining the relevant approval from the relevant authorities of the PRC (if applicable);(ii) fulfilling the relevant requirements of the articles of association of Lusigang Power Company;(iii) obtaining the approval from the general meeting of Lusigang Power Company;(iv) obtaining the approval from the relevant approval authorities of the Company; and(v) obtaining the approval from the relevant approval authorities of CDC. As at the date of the announcement, the above-mentioned conditions numbered(iii) and (iv) haven been satisfied. Information relating to Lusigang Power Company Lusigang Power Company was incorporated at Nantong, Qidong City in JiangsuProvince in September 2003, of which 90% and 10% of its equity interest are heldby the Company and Nantong Zhonghe Share Holding Co., Ltd. respectively. Theregistered capital of Lusigang Power Company amounts to RMB132 million. LusigangPower Company is a project company which makes preparation for constructing andoperating Lusigang Power Plant with 4 x 600 MW coal-fired power generationunits. At present, Lusigang Power Company is still entrusted the construction ofthe project relating to the development of the afore-mentioned 4 x 600 MWcoal-fired power generation units. Therefore, no revenue nor net profit (bothbefore and after taxation and extraordinary items) were derived by LusigangPower Company for the two years ended 31 December 2006 and 31 December 2007,respectively. Upon completion of the Equity Transfer, the Company will own 55% equity interestin Lusigang Power Company and the results of Lusigang Power Company willcontinue to be consolidated into the accounts of the Company. The net book value of the assets of Lusigang Power Company as at 31 January 2008based on PRC GAAP was approximately RMB267,222,200 Information relating to the Company The Company is principally engaged in the development and operation of powerplants, the sale of electricity and thermal power, and the repair and testing ofpower equipment and power related technical services, with its main serviceareas in the PRC. Information relating to CDC CDC is a state-owned enterprise; its main scope of operations are thedevelopment, investment, construction, operation and management of power energy,organisation of power (thermal) production and sales, power technologydevelopment and consultation, and so forth. REASONS FOR AND BENEFITS OF ENTERING INTO THE TRANSFER AGREEMENT The sales proceeds from the Equity Transfer will be used by the Company asworking capital to facilitate its business development and businessdiversification. Further, the Company considers that the funds obtained by theCompany from the Equity Transfer can also enhance its capability in businessdevelopment so as to achieve smooth coordination and progress on the futuredevelopment of the Company. The Company expects to realise a gain of RMB14,922,230 from the Equity Transferwhich is calculated based on the differences between the value of theconsideration (i.e., RMB108,450,000) and the net book value of the 35% equityinterest of shareholders of Lusigang Power Company based on PRC GAAP as at 31January 2008 (i.e., RMB93,527,770). The Directors (including the independent non-executive Directors) are of theview that the terms of the Transfer Agreement were on normal commercial termsafter arm's length negotiation between the parties, and that the terms of theTransfer Agreement are fair and reasonable and in the best interests of theCompany and its shareholders as a whole. CONNECTED TRANSACTION As at the date of the Announcement, CDC held approximately 33.74% of the issuedshare capital of the Company. Accordingly, CDC is a connected person of theCompany under the Listing Rules and therefore the Equity Transfer constitutes aconnected transaction of the Company. As each of the applicable percentage ratio(as defined in Rule 14.07 of the Listing Rules) is more than 0.1% but less than2.5%, the Equity Transfer is only subject to the reporting and announcementrequirements under Chapter 14A of the Listing Rules and does not require theapproval by the independent shareholders of the Company. The Company willdisclose the relevant details in the next published annual report and accountsof the Company in accordance with the relevant requirements as set out in Rule14A.45 of the Listing Rules. DEFINITIONS In this announcement, unless the context otherwise requires, the followingexpressions have the following meanings: "A Share(s)" the domestic ordinary share(s) of the Company with a nominal value of RMB1.00 each "Board" the board of directors of the Company"CDC" China Datang Corporation, a state-owned enterprise established under the laws of the PRC and a controlling Shareholder of the Company holding approximately 33.74% of the issued share capital of the Company as at the date of the announcement "Company" Datang International Power Generation Co., Ltd., a sino-foreign joint stock limited company incorporated in the PRC on 13 December 1994, of which the H Shares are listed on The Stock Exchange of Hong Kong Limited and The London Stock Exchange Limited and the A Shares are listed on the Shanghai Stock Exchange "Directors" the directors of the Company "Equity Transfer" the transfer of 35% equity interest of Lusigang Power Company by the Company to CDC pursuant to the Transfer Agreement "H Share(s)" the overseas listed foreign shares of the Company with a nominal value of RMB1.00 each "HK$" Hong Kong dollar(s), the lawful currency of Hong Kong"Hong Kong" the Hong Kong Special Administrative Region of the PRC "Listing Rules" Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited "Lusigang Power Jiangsu Datang International Lusigang Power Generation Company LimitedCompany" "PRC" the People's Republic of China"RMB" Renminbi, the lawful currency of the PRC"Transfer Agreement" the transfer agreement dated 2 April 2008 entered into by the Company and CDC relating to the Equity Transfer "%" per cent. Note: Unless otherwise specified and for reference only, the conversion of HongKong dollars into Renminbi is based on the exchange rate of HK$1= RMB0.9 in thisannouncement. By Order of the Board Zhou Gang and Mok Chung Kwan, Stephen Joint Company Secretaries Beijing, the PRC, 2 April 2008 As at the date of this announcement, the Directors are: Zhai Ruoyu, Zhang Yi, Hu Shengmu, Fang Qinghai, Zhou Gang, Liu Haixia, GuanTiangang, Su Tiegang, Ye Yonghui, Li Gengsheng, Xie Songlin*, Liu Chaoan*, YuChangchun* and Xia Qing* * Independent non-executive Directors This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Datang Intl H