ANNOUNCEMENT CONNECTED TRANSACTION

Transcription

1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. (a sino-foreign joint stock limited company incorporated in the People's Republic of China) (Stock Code: 00991) ANNOUNCEMENT CONNECTED TRANSACTION Desulfurization Transformation Project Contract According to the result of public tender, on 19 November 2013, Honghe Power Company entered into the Desulfurization Transformation Project Contract with Datang Technology Industry Company and Datang Technologies and Engineering Company, pursuant to which Honghe Power Company agreed to engage Datang Technology Industry Company and Datang Technologies and Engineering Company to carry out the desulfurization transformation work of its generating units with the aggregate contract sum amounting to approximately RMB million. Listing Rules Implications As at the date of this announcement, CDC is the controlling shareholder of the Company, which together with its subsidiaries hold approximately 34.71% of the issued share capital of the Company. Datang Technology Industry Company is a wholly-owned subsidiary of CDC, and Datang Technologies and Engineering Company is an indirectly-controlled subsidiary of CDC, therefore Datang Technology Industry Company and Datang Technologies and Engineering Company are connected persons of the Company. The transaction contemplated under the Desulfurization Transformation Project Contract constitutes a connected transaction of the Company. As one or more of the applicable percentage ratios (as defined under Rule of the Listing Rules) in respect of the transaction amount under the Desulfurization Transformation Project Contract is more than 0.1% but less than 5%, the transaction contemplated under the Desulfurization Transformation Project Contract is only subject to the reporting and announcement requirements under Chapter 14A of the Listing Rules and does not require the approval by the independent shareholders of the Company

2 DESULFURIZATION TRANSFORMATION PROJECT CONTRACT Date: 19 November 2013 Parties: Contracting Party: Honghe Power Company Contractors: Datang Technology Industry Company; and Datang Technologies and Engineering Company Major particulars of the contract: 1. Subject matter: Datang Technology Industry Company and Datang Technologies and Engineering Company jointly undertake the desulfurization transformation work of 2 300MW circulating fluidized bed generating units of Honghe Power Company, including the design, supply of goods, construction, testing and provision of technical services of the desulfurization transformation work. 2. Consideration: The consideration of the contract amounts to approximately RMB million, among which, acquisition cost of facilities accounts for approximately RMB million, consideration for construction work accounts for approximately RMB million, consideration for installation work accounts for approximately RMB million, and design, testing and other costs account for approximately RMB5.7 million. 3. Settlement and payment: A. Prepayment: Within one month from the effective date of the contract, the Contractors shall provide an irrevocable performance bond guarantee in the amount equivalent to 10% of the total contract price and a financial receipt equivalent to 10% of the total consideration for the acquisition of facilities, construction and the installation work, the Contracting Party shall pay 10% of the total consideration for the acquisition of the facilities, construction and the installation work to the Contractors as prepayment within one month upon verification of such documents

3 B. Consideration for construction and installation works: (1) Upon completion of 50% of the construction work by the Contractors, the Contracting Party shall pay 20% of the construction and installation fees; (2) Upon completion of 80% of the construction work by the Contractors, the Contracting Party shall pay 20% of the construction and installation fees; (3) Upon completion of 100% of the construction work by the Contractors, the Contracting Party shall pay 20% of the construction and installation fees; (4) Upon completion of the installation work by the Contractors, the Contracting Party shall pay 20% of the construction and installation fees after check and acceptance; (5) The Contracting Party shall pay 10% of the consideration of construction and installation to the Contractors after the expiration of the warranty period of the contract and no quality issues arises, and within one year upon the submission of the final certificate of check-and-acceptance by the Contractors and verification of such documents by the Contracting Party. C. Acquisition cost of facilities: (1) Within one month upon submission of a checklist of main facilities and materials of the contract and other relevant documents by the Contractors, and upon verification of such documents by the Contracting Party, the Contracting Party shall pay 20% of the facilities and materials costs to the Contractors as project progress payment; (2) Within one month upon delivery of the last batch of main facilities and materials and provision of the relevant certificates and documents by the Contractors, and upon verification of such documents by the Contracting Party, the Contracting Party shall pay 30% of the facilities and materials costs to the Contractors; (3) Within one month upon completion and check-and-acceptance of the installation work, and provision of the relevant certificates and documents by the Contractors, and upon verification of such documents by the Contracting Party, the Contracting Party shall pay 30% of the facilities and materials costs to the Contractors; (4) 10% of the facilities and materials costs will be used as warranty bond. After the expiration of the warranty period of the contract and no quality issues arises, and within one month upon the submission of the final certificate of check-and-acceptance by the Contractors and verification of such documents by the Contracting Party, the Contracting Party shall pay 10% of the facilities and - 3 -

4 materials costs to the Contractors. D. Payment for technical services (including design fees and testing fees) and other costs: (1) Within one month from the effective date of the contract and upon submission of the relevant documents by the Contractors, the Contracting Party shall pay 25% of the total service fee for technical services of the construction work to the Contractors; (2) Upon completion of the design of the overall construction work and within one month submission of construction drawings and relevant certification documents by the Contractors, and upon verification of such documents by the Contracting Party, the Contracting Party shall pay 50% of the total service fee for technical services of the construction work to the Contractors; (3) After the facilities under the contract are checked and accepted, the test run is passed and the preliminary certificate of check-and-acceptance is signed, the Contracting Party shall pay 25% of the total service fee for technical services of the construction work to the Contractors. 4. Conditions precedent: The Desulfurization Transformation Project Contract shall become effective when it is duly signed and sealed by the legal representative or the authorized representative of the parties. REASONS FOR AND BENEFITS OF ENTERING INTO THE DESULFURIZATION TRANSFORMATION PROJECT CONTRACT According to the annual technical transformation plan of the Company, the Company invited public tender for the desulfurization transformation project for the generating units of its directly-managed power plants and subsidiaries. After carrying out relevant evaluation procedures and considering various factors, including the technical experiences, professional qualification, business reputation, project management skills, consideration amount and other relevant factors of all the tenderers, Datang Technology Industry Company and Datang Technologies and Engineering Company were selected as the tender winners for the desulfurization transformation project for the generating units of Honghe Power Company. Datang Technology Industry Company and Datang Technologies and Engineering Company have sufficient qualification with expertise and experience in carrying out the desulfurization transformation project. The Company considers that Datang Technology Industry Company and Datang Technologies and Engineering Company will be capable to ensure the desulfurization - 4 -

5 transformation project to be carried out smoothly. Meanwhile, the Company may fully ride on the professional advantage of Datang Technology Industry Company and Datang Technologies and Engineering Company, as well as to control cost through large scale purchasing of facilities. Directors (including independent non-executive Directors) are of the view that the transaction under the Desulfurization Transformation Project Contract was duly completed by way of public tender; the relevant terms are fair and reasonable and conducted on normal commercial terms and is in the interests of the Company and its shareholders as a whole. BOARD S APPROVAL During the thirty-sixth meeting of the seventh session of the Board, the Resolution on the Tendering for the Technological Transformation Projects of the Company and its Subsidiaries was passed on 25 April The Board agreed the wholly-owned subsidiary of the CDC, Datang Environmental Technology and Engineering Co., Ltd. (now known as Datang Technology Industry Company), or its subsidiaries, to enter into an agreement with the Company and its subsidiaries after participating the tender and winning the bid. None of the Directors has material interests in the transaction under the Desulfurization Transformation Project Contract. Connected Directors, including Liu Shunda, Hu Shengmu and Fang Qinghai, have abstained from voting at the relevant Board meeting for the approval of the relevant resolution pursuant to the listing rules of the Shanghai Stock Exchange. INFORMATION OF THE PARTIES 1. The Company is principally engaged in the construction and operation of power plants, the sale of electricity and thermal power, the repair and maintenance of power equipment and power related technical services, with its main service areas being in the PRC. 2. Honghe Power Company, a controlled subsidiary of the Company, is currently operating two 300MW circulating fluidized bed generating units. The equity structure of the company is: the Company holds 70% equity interest, Yunnan Energy Investment (Group) Co., Ltd. holds 15% equity interest, Yunnan Xiaolongtan Mining Bureau holds 10% equity interest, and Hongyunhonghe Tobacco (Group) Co., Ltd. holds 5% equity interest. 3. CDC was established on 9 March 2003 with registered capital of RMB18,109 million and is principally engaged in the development, investment, construction, operation and management of power energy, organisation of power (thermal) production and sales; manufacturing, repair and maintenance of power equipment; power technology development and consultation; power engineering, contracting and consultation of environmental power engineering; development of new energy as well as development and production of power related coal resources

6 4. Datang Technology Industry Company is a wholly-owned subsidiary of CDC. Its scope of operation primarily includes development of environmental projects, and investment in and operational management of environmental facilities; and research and development, design, production, inspection and sales of flue gas denitrification catalysts and the provision of related technical services. Datang Technology Industry Company holds 51% equity interest in Datang Technologies and Engineering Company. 5. Datang Technologies and Engineering Company is an indirectly-controlled subsidiary of CDC. Its scope of operation primarily includes development, service and consulting of environmental technology, development, manufacture and sales of environmental equipment and operation of environmental pollution control facilities. LISTING RULES IMPLICATIONS As at the date of this announcement, CDC is the controlling shareholder of the Company, which together with its subsidiaries hold approximately 34.71% of the issued share capital of the Company. Datang Technology Industry Company is a wholly-owned subsidiary of CDC, and Datang Technologies and Engineering Company is an indirectly-controlled subsidiary of CDC, therefore Datang Technology Industry Company and Datang Technologies and Engineering Company are connected persons of the Company. The transaction contemplated under the Desulfurization Transformation Project Contract constitutes a connected transaction of the Company. As one or more of the applicable percentage ratios (as defined under Rule of the Listing Rules) in respect of the transaction amount under the Desulfurization Transformation Project Contract is more than 0.1% but less than 5%, the transaction contemplated under the Desulfurization Transformation Project Contract is only subject to the reporting and announcement requirements under Chapter 14A of the Listing Rules and does not require the approval by the independent shareholders of the Company. DEFINITIONS In this announcement, unless the context otherwise requires, the following expressions have the following meanings: Board the board of Directors CDC China Datang Corporation, a State-owned enterprise established under the laws of the PRC and is a controlling shareholder of the Company. CDC and its subsidiaries own approximately 34.71% of the issued share capital of the Company as at the date of this announcement - 6 -

7 Company Datang International Power Generation Co., Ltd., a sino-foreign joint stock limited company incorporated in the PRC on 13 December 1994, whose H Shares are listed on the Stock Exchange and the London Stock Exchange and whose A Shares are listed on the Shanghai Stock Exchange connected person(s) has the meaning ascribed to it under the Listing Rules connected transaction has the meaning ascribed to it under the Listing Rules Desulfurization Transformation Project Contract the contract on desulfurization transformation project for 2x300MW circulating fluidized bed generating units of Honghe Power Company entered into between Honghe Power Company, Datang Technology Industry Company and Datang Technologies and Engineering Company on 19 November 2013 Datang Technologies and Engineering Company China Datang Technologies and Engineering Company Limited, a controlled subsidiary of Datang Technology Industry Company Limited, a wholly-owned subsidiary of CDC. For more information, please refer to the section headed INFORMATION OF THE PARTIES Datang Technology Industry Company Datang Technology Industry Company Limited, formerly known as Datang Environmental Technologies & Engineering Co., Ltd., which name changed to Datang Technology Industry Company Limited in October 2013, a wholly-owned subsidiary of CDC. For more information, please refer to the section headed INFORMATION OF THE PARTIES Director(s) the director(s) of the Company Honghe Power Company Yunnan Datang International Honghe Power Generation Company Limited, a subsidiary of the Company. For more information, please refer to the section headed INFORMATION OF THE PARTIES Listing Rules the Rules Governing the Listing of Securities on the Stock Exchange - 7 -

8 PRC the People s Republic of China RMB Renminbi, the lawful currency of the PRC Stock Exchange The Stock Exchange of Hong Kong Limited % percentage By Order of the Board Zhou Gang Secretary to the Board Beijing, the PRC, 19 November 2013 As at the date of this announcement, the Directors of the Company are: Chen Jinhang, Hu Shengmu, Cao Jingshan, Fang Qinghai, Zhou Gang, Li Gengsheng, Cao Xin, Cai Shuwen, Liu Haixia, Guan Tiangang, Dong Heyi*, Ye Yansheng*, Li Hengyuan*, Zhao Jie*, Jiang Guohua* * Independent non-executive Directors - 8 -