(A joint stock limited company incorporated in the People s Republic of China with limited liability) (Stock Code: 2868)

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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 joint stock limited company incorporated in the People s Republic of China with limited liability) (Stock Code: 2868) DISCLOSEABLE TRANSACTION SHARE PURCHASE AGREEMENT The Board is pleased to announce that on 24 December 2013, a Sale and Purchase Agreement was entered into between (1) ICBC International Investment Management as the Purchaser, (2) the Company, (3) Rueyyuan as the Seller, an indirectly wholly-owned subsidiary of the Company, (4) Speed Plus and (5) Opal Treasure, pursuant to which (i) Rueyyuan agreed to dispose of and ICBC International Investment Management agreed to acquire 63% of the issued share capital of Speed Plus at a consideration of US$63 and (ii) Rueyyuan agreed to dispose of and Speed Plus agreed to acquire the Sale Shares and Shareholders Loan at an aggregate consideration of US$146,000,037. For the purpose of Chapter 14 of the Listing Rules, as one or more than one of the applicable percentage ratios (as defined in Rule of the Listing Rules) exceed 5% but less than 25%, the transaction under the Sale and Purchase Agreement constitutes a discloseable transaction for the Company and is subject to the notification and announcement requirements under Chapter 14 of the Listing Rules. THE SALE AND PURCHASE AGREEMENT Date 24 December 2013 Parties involved (1) ICBC International Investment Management, as the Purchaser (2) The Company (3) Rueyyuan, as the Seller (4) Speed Plus (5) Opal Treasure To the best of the Directors knowledge, information and belief after making all reasonable enquiries, ICBC International Investment Management and its ultimate beneficial owner are independent third parties not connected with the Company and its connected persons. 1

2 Assets to be disposed of (i) 63% of the issued share capital of Speed Plus; and (ii) of the issued share capital of Opal Treasure ( Sale Shares ) and Shareholders Loan of US$142,502,031. The consideration The consideration of US$146,000,037, being the aggregate of US$3,498,006 for the sale and purchase of the Sale Shares and US$142,502,031 for the sale and purchase of the Shareholders Loan shall be settled by Speed Plus on the Completion Date. The consideration was determined after arm s length negotiations between the Seller and the Purchaser taking into consideration of (i) the net asset value of Speed Plus, Opal Treasure, Fenson and Project Company as at 31 October 2013; and (ii) the mutual undertakings made by the Rueyyuan and Purchaser under the Sale and Purchase Agreement to provide funds upon Completion in order to repay the Special Loan pursuant to the terms and conditions under the Sale and Purchase Agreement. Condition precedent and Completion Completion is conditional upon the fulfillment or waiver (as the case may be) of the condition precedent that the warranties and representations in the Sale and Purchase Agreement remain true and accurate in all material respect and not misleading in any respect at all times from the date of the Sale and Purchase Agreement up to and including the Completion Date. Subject to fulfillment or waiver of the condition precedent, Completion shall take place on the Completion Date. Upon Completion, the Group will hold 37% interest in Speed Plus and indirectly hold 37% interest in Opal Treasure, each of Speed Plus, Opal Treasure and Fenson will cease to be subsidiaries of the Company. 2

3 SHAREHOLDING STRUCTURE OF THE TRANSACTION Set out below are the simplified shareholding structure immediately before and after completion of the transaction: Immediately before completion of the Transaction; The Company Rueyyuan (HK) Opal Treasure (BVI) Speed Plus (BVI) Capital Chaoyang (PRC) Fenson (HK) 50% 50% The Project Company (PRC) 3

4 Immediately after completion of the Transaction; The Comapny ICBC International Investment Management (BVI) Rueyyuan (HK) 37% 63% Speed Plus (BVI) Opal Treasure (BVI) Capital Chaoyang (PRC) Fenson (HK) 50% 50% The Project Company (PRC) 4

5 THE SPEED PLUS SHAREHOLDERS AGREEMENT In connection with the disposal of 63% of the issued share capital of Speed Plus, ICBC International Investment Management, Rueyyuan and Speed Plus entered into the Speed Plus Shareholders Agreement on the date of the Sale and Purchase Agreement. The principal terms of the Speed Plus Shareholders Agreement include, amongst other things, the following: Shareholders loan and special loan Pursuant to the Speed Plus Shareholders Agreement, on (or before) the Completion Date: (a) (b) ICBC International Investment Management will provide a shareholders loan in the amount of US$70,000,000 to Speed Plus; ICBC International Investment Management will provide a special loan in the amount of US$77,948,653 to Speed Plus. Rueyyuan will transfer shareholders loan receivable from Opal Treasure in the amount of US$49,313,968 to shareholders loan receivable from Speed Plus Board representation Pursuant to the Speed Plus Shareholders Agreement, the board of directors of Speed Plus will comprise three members, two of which to be nominated by ICBC International Investment Management and one to be nominated by Rueyyuan. The chairman of the board of Speed Plus shall be a director designated by ICBC International Investment Management in accordance with the articles of association of Speed Plus. Restrictions on transfer Pursuant to the Speed Plus Shareholders Agreement: (1) Except for the permitted transfer and the share transfer in relation to events in breach of the Speed Plus Shareholders Agreement as set out in (3) and (5) in this section, without the prior written consent of the other shareholder(s), any shareholder(s) shall not directly or indirectly dispose of shares held by itself or shareholders loan provided to Speed Plus before 31 December 2014 (2) The transfer of shares by any shareholder of Speed Plus must take place simultaneously with the transfer of any outstanding shareholders loan provided by such shareholder, and the shareholders loan to be transferred shall be determined based on the ratio of the number of shares to be transferred to the number of Speed Plus shares held by such shareholders before such transfer, and vice versa. (3) Subject the execution of a deed of adherence by the transferee, any shareholder of Speed Plus may transfer any of its shares to its group companies (group companies do not include the funds set up, controlled by or managed by ICBC International Management). If such transferee ceases to be part of the group, it shall transfer the shares of Speed Plus held by it to another permitted transferee under Speed Plus Shareholders Agreement. 5

6 (4) Any transfer of the share of Speed Plus by any shareholders (except for the permitted transfer and the share transfer in relation to a breach of the Speed Plus Shareholders Agreement set out in (3) and (5) in this section) is subject to pre-emptive right of all other existing shareholder(s). If the other existing shareholder(s) do not exercise the pre-emptive right, then the offering shareholder may transfer all the proposed transfer shares to any other person, provided that the transfer is restricted but not limited to: (a) the transfer is of all of legal and beneficial interest in the proposed transfer shares; (b) the terms of the transfer are not more favourable than those offered to the existing shareholder(s); (c) the transfer must take place within two (2) months in the offer period; and (d) the transferee shall execute a deed of adherence. (5) If any of the events in breach of the Speed Plus Shareholders Agreement exists and continues to exist, then the non default shareholder(s) is entitled to request the default shareholder(s) to (i) sell or procure the sale of the specified shares at the specified price set out in the Speed Plus Shareholders Agreement; or (ii) purchase the specified shares at the specified price set out in the Speed Plus Shareholders Agreement. INFORMATION ON THE PARTIES ICBC International Investment Management ICBC International Investment Management Ltd. is a wholly-owned subsidiary of ICBC International Holdings Ltd. ( ICBCI ). ICBCI is the overseas investment banking platform of Industrial and Commercial Bank of China Limited ( ICBC ). Established in 2008, ICBCI is Hong Kong incorporated and a wholly-owned subsidiary of ICBC. The Group The Group is a large property developer in the PRC, focusing primarily on developing and investing in high quality and high-end commercial properties and medium to high-end residential properties, operation of hotels, property consulting services and investment holding. Speed Plus Speed Plus is an investment holding company incorporated under the laws of BVI on 24 May 2011 with limited liability. Prior to Completion, Speed Plus was wholly owned by Rueyyuan and has a nominal issued and paid-up share capital of US$100 comprising 100 ordinary shares of US$1.00 each. The unaudited net liability of Speed Plus as at 31 October 2013 was approximately HK$23,000. The unaudited net loss before and after taxation and extraordinary items were both approximately HKD17,700 for the financial year ended 31 December 2012 and HKD5,300 for the period ended 31 October Opal Treasure Opal Treasure is an investment holding company incorporated under the laws of BVI on 28 April 2011 with limited liability. Opal Treasure will, upon Completion, be owned by by Speed Plus pursuant to the Sale and Purchase Agreement and has a nominal issued and paid-up share capital of US$100 comprising 100 ordinary shares of US$1.00 each. Opal Treasure holds of the issued share capital of Fenson. 6

7 The unaudited net liability of Opal Treasure as at 31 October 2013 was approximately HKD23,000. The unaudited net loss before and after taxation and extraordinary items were both approximately HKD17,000 for the financial year ended 31 December 2012 and HKD5,300 for the period ended 31 October Fenson Fenson is an investment holding company incorporated under the laws of Hong Kong on 21 March 2011 with limited liability. Fenson is wholly owned by Opal Treasure and has a nominal issued and paid-up share capital of HK$1.00 comprising 1 ordinary shares of HK$1.00. Fenson holds 50% equity interest in Project Company. The remaining 50% equity interest in Project Company is held by Capital Chaoyang. The unaudited net liability of Fenson as at 31 October 2013 was approximately HKD44,235,000. The unaudited net loss before and after taxation and extraordinary items were both approximately HKD4,200 for the financial year ended 31 December 2012 and HKD44,231,000 for the period ended 31 October Project Company Project Company is a limited liability company incorporated under the laws of the PRC on 28 June 2013 and is principally engaged in property development. As at the date of this announcement, Project Company is held by Fenson as to 50% and Capital Chaoyang as to 50% and is accounted for as a subsidiary of the Company. The registered capital of Project Company is RMB2,246,490,000 and the paid-up registered capital is RMB2,246,490,000. The unaudited net asset value of Project Company as at 31 October 2013 was approximately RMB2,237,469,000. The unaudited net loss before and after taxation and extraordinary items were both approximately RMB9,206,000 for the period ended 31 October Project Company entered into a contract for state-owned construction land use right assignment with competent land authority in Beijing on March 2013 in respect of the land plot No. F-02 located at Li Ze Financial Business District, Feng Tai District, Beijing the PRC (the Project Site ). The Project Site is planned for the construction of office buildings and retail mall with total above the ground gross floor area of approximately 149,900 square meters and the construction is expected to be completed in The Project Company will continue to be a subsidiary of the Company after the transaction. REASONS AND BENEFITS OF THE DISPOSAL OF 63% OF THE ISSUED SHARE CAPITAL OF SPEED PLUS AND THE SALE SHARES AND SHAREHOLDERS LOAN The Directors consider that the Disposal will facilitates to speed up the turnover cycle of the Company s assets, increases liquidity and raise the effectiveness for use of capital, which allow the Group to develop its strengths on international collaboration, financing and business resource integration. Besides, by introducing cooperative partners, market risk on the project is able to be reduced, hence expanding the land bank of the Company within the key areas in Beijing and increase market presence. The Directors (including the independent non-executive Directors) believe that the terms of the Sale and Purchase Agreement are normal commercial terms made on an arm s length basis, in the ordinary and usual course of business of the Group and are fair and reasonable and in the interest of the Shareholders as a whole. The Directors consider that it will be in the interest of the Company to adopt the terms of the Sale and Purchase Agreement. 7

8 USE OF PROCEEDS AND FINANCIAL EFFECT OF THE DISPOSAL OF 63% OF THE ISSUED SHARE CAPITAL OF SPEED PLUS AND THE SALE SHARES AND SHAREHOLDERS LOAN It is the current intention of the Company that the proceeds arising from the disposal of (i) 63% of the issued share capital of Speed Plus and (ii) the Sale Shares and Shareholders Loan shall be used by the Company as general working capital. Upon Completion, Speed Plus, Opal Treasure and Fenson shall cease to be subsidiaries of the Company. It is expected that the disposal will increase the unaudited capital surplus of approximately RMB21,000,000 and unaudited minority interest of approximately RMB870,000,000 to the Company. As the project company will continue to be the subsidiary of the Company, there will not be any significant gain or loss arise. LISTING RULES IMPLICATION As one or more than one of the applicable percentage ratios (as defined in Rule of the Listing Rules) exceed 5% but less than 25%, the transactions under the Sale and Purchase Agreement constitute discloseable transactions for the Company and is subject to the notification and announcement requirements under Chapter 14 of the Listing Rules. DEFINITIONS Board Business Day BVI Capital Chaoyang Company Completion Completion Date Directors the board of Directors a day (other than a Saturday or a Sunday) on which banks are open for business in Hong Kong and the PRC British Virgin Islands S.C. Real Estate Development Co., Ltd., a company incorporated in the PRC with limited liability and a wholly-owned subsidiary of the Company Beijing Capital Land Ltd., a joint stock company incorporated in the PRC with limited liability and whose H Shares (stock code: 2868) are listed on the Main Board of the Stock Exchange completion of the Sale and Purchase Agreement the fifth (5th) Business Day after the date of the Sale and Purchase Agreement or the completion date as extended in accordance with the Sale and Purchase Agreement or such other day as agreed between the parties the directors of the Company 8

9 Fenson Group Hong Kong HK$ Fenson International Limited, a company incorporated in Hong Kong with limited liability and an indirect wholly-owned subsidiary of the Company the Company and its subsidiaries The Hong Kong Special Administrative Region of the PRC Hong Kong Dollar, the lawful currency of Hong Kong H Shares the ordinary shares of RMB1.00 each in the share capital of the Company, which are issued outside the PRC, listed on the Stock Exchange and traded in Hong Kong ICBC International Investment Management Listing Rules Opal Treasure PRC Project Company RMB Rueyyuan Shareholders Loan Sale Shares Shareholder(s) ICBC International Investment Management Limited, a whollyowned subsidiary of ICBC International Holdings Limited the Rules Governing the Listing of Securities on the Stock Exchange Opal Treasure Holdings Limited, a company incorporated in the BVI with limited liability and an indirect wholly-owned subsidiary of the Company the People s Republic of China Beijing Tian Cheng Yongtai Zhi Ye Limited, a company incorporated in the PRC with limited liability and, as at the date of this announcement held as to 50% by Fenson and Capital Chaoyang as to 50% Renminbi, the lawful currency of the PRC Rueyyuan Holding Company Limited, a company incorporated in Hong Kong with limited liability and an indirect wholly-owned subsidiary of the Company US$142,502,031 being the amount of loan due and owed by Opal Treasure to Rueyyuan with interest of 12% per annum calculated from the date on which the Shareholders Loan was advanced up to the Completion Date 100 ordinary shares of US$1.00 each, representing of the issued share capital of Opal Treasure holder(s) of the H Shares 9

10 Speed Plus Speed Plus Shareholders Agreement Stock Exchange Sale and Purchase Agreement US$ Speed Plus Investments Limited, a company incorporated in the BVI with limited liability and an indirect wholly-owned subsidiary of the Company the shareholders agreement to be entered into between Rueyyuan, ICBC International Investment Management and Speed Plus The Stock Exchange of Hong Kong Limited the sale and purchase agreement dated 24 December 2013 entered into between ICBC International Investment Management, the Company, Rueyyuan, Speed Plus and Opal Treasure in relation to the disposal of (i) 63% of the issued share capital of Speed Plus and (ii) the Sale Shares and Shareholders Loan United States dollars, the lawful currency of the United States of America % per cent. The English names of the PRC entities are translations of their Chinese names and are included for identification purpose only. Hong Kong, 24 December 2013 By Order of the Board Beijing Capital Land Ltd. Lee Sing Yeung, Simon Company Secretary The Board as of the date of this announcement comprises Mr. Liu Xiaoguang (Chairman), Mr. Tang Jun and Mr. Zhang Juxing who are the Executive Directors, Mr. Wang Hao, Mr. Shen Jianping and Mr. Zhang Shengli who are the Non-Executive Directors, Mr. Li Zhaojie, Mr. Ng Yuk Keung and Mr. Wang Hong who are the Independent Non-Executive Directors. 10