COMPOSITE DOCUMENT IN RELATION TO

Transcription

1 THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION If you are in doubt as to any aspect of the Offer, this Composite Document and/or the accompanying Acceptance Form or as to the action to be taken, you should consult a licensed securities dealer or registered institution in securities, a bank manager, solicitor, professional accountant or other professional adviser. If you have sold or transferred all your shares in Fittec International Group Limited, you should at once hand this Composite Document, together with the accompanying Acceptance Form, to the purchaser(s) or transferee(s) or to the bank, licensed securities dealer or registered institution in securities, or other agent through whom the sale or the transfer was effected for onward transmission to the purchaser(s) or the transferee(s). This Composite Document should be read in conjunction with the accompanying Acceptance Form, the contents of which form part of the terms and conditions of the Offer contained herein. Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsibility for the contents of this Composite Document and the accompanying Acceptance Form, make no representation as to their 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 Composite Document and the accompanying Acceptance Form. China Base Group Limited (Incorporated in the BVI with limited liability) Joint Financial Advisers Fittec International Group Limited (Incorporated in the Cayman Islands with limited liability) (Stock Code: 2662) Joint Financial Advisers COMPOSITE DOCUMENT IN RELATION TO UNCONDITIONAL MANDATORY CASH OFFER BY ANGLO CHINESE CORPORATE FINANCE LIMITED AND CHINA SECURITIES (INTERNATIONAL) CORPORATE FINANCE COMPANY LIMITED FOR AND ON BEHALF OF CHINA BASE GROUP LIMITED TO ACQUIRE ALL THE ISSUED SHARES OF FITTEC INTERNATIONAL GROUP LIMITED (OTHER THAN THOSE ALREADY OWNED OR AGREED TO BE ACQUIRED BY CHINA BASE GROUP LIMITED AND PARTIES ACTING IN CONCERT WITH IT) Independent Financial Adviser to the Independent Board Committee Capitalised terms used in this cover page shall have the same meanings as those defined in the section headed Definitions in this Composite Document. A letter from Anglo Chinese and CSCF containing, among other things, details of the terms and conditions of the Offer is set out on pages 7 to 15 of this Composite Document. A letter from the Board is set out on pages 16 to 20 of this Composite Document. A letter from the Independent Board Committee containing its recommendation and advice to Independent Shareholders on the Offer is set out on pages 21 to 22 of this Composite Document. A letter from Nuada containing its recommendation and advice to the Independent Board Committee is set out on pages 23 to 44 of this Composite Document. The procedures for acceptance and settlement of the Offer are set out in Appendix I to this Composite Document and in the accompanying Acceptance Form. Acceptance of the Offer must be received by the Registrar, Computershare Hong Kong Investor Services Limited, at Shops , 17/F, Hopewell Centre, 183 Queen s Road East, Wan Chai, Hong Kong as soon as possible and in any event no later than 4:00 p.m. on 4 February 2016, or such later time and/or date as the Offeror may determine and announce with the consent of the Executive and in accordance with the Takeovers Code. Persons including, without limitation, custodians, nominees and trustees who would, or otherwise intend to, forward this Composite Document and/or the accompanying Acceptance Form to any jurisdiction outside Hong Kong should read the details in this regard which are contained in the section headed Overseas Shareholders in Appendix I to this Composite Document before taking any action. It is the responsibility of each Overseas Shareholder wishing to accept the Offer to satisfy himself, herself or itself as to the full observance of the law and regulations of the relevant jurisdictions in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required and the compliance with other necessary formalities or legal requirements and the payment of any transfer or other taxes due in respect of such jurisdiction. Overseas Shareholders are advised to seek professional advice on deciding whether to accept the Offer. This Composite Document will remain on the websites of the Stock Exchange ( and the Company ( as long as the Offer remains open. 14 January 2016

2 CONTENTS Page Expected Timetable... i Definitions... 1 Letter from Anglo Chinese and CSCF... 7 Letter from the Board Letter from the Independent Board Committee Letter from Nuada Appendix I Further Terms of the Offer and Procedures for Acceptance Appendix II Financial Information of the Group Appendix III General Information of the Group Appendix IV General Information of the Offeror Accompanying Document Acceptance Form

3 EXPECTED TIMETABLE The expected timetable set out below is indicative only and may be subject to change. Any change to the timetable will be jointly announced by the Offeror and the Company as and when appropriate. Unless otherwise specified, all times and dates contained in this Composite Document refer to Hong Kong local times and dates Record Date for the Special Dividend (Note 1)...Wednesday, 6 January Despatch date of this Composite Document and the accompanying Acceptance Form and the commencement of the Offer (Note 2)...Thursday, 14 January Latest time and date for acceptance of the Offer (Notes 3, 4 and 7)...by4:00 p.m. on Thursday, 4 February Closing Date of the Offer (Notes 2, 3 and 7)...Thursday, 4 February Announcement of the results of the Offer on the website of the Stock Exchange (Note 5).. by 7:00 p.m. on Thursday, 4 February Latest date for posting of remittances in respect of valid acceptances received under the Offer (Notes 6 and 7)...Thursday, 18 February Notes: 1. The payment of the Special Dividend will be made on 13 January For the avoidance of doubt, any Shareholder whose name appears on the Company s principal or branch share register on the Record Date and subsequently accepts the Offer would still be entitled to the Special Dividend. Shareholders will be entitled to the Special Dividend irrespective of whether they accept the Offer or not. 2. The Offer, which is unconditional in all respects, is made on the date of posting of this Composite Document, and is capable of acceptance on and from that date until the Closing Date of the Offer on 4 February Acceptances of the Offer shall be irrevocable and not capable of being withdrawn, except in the circumstances set out in the section headed Right of withdrawal in Appendix I to this Composite Document. 3. In accordance with the Takeovers Code, the Offer must initially be open for acceptance for at least 21 days following the date on which this Composite Document is posted. Where the Offer Period laid down by the Takeovers Code ends on a day which is not a Business Day, the period is extended until the next Business Day. 4. The Independent Shareholders are required to submit the duly completed and signed Acceptance Form to the Registrar on or before 4:00 p.m. on 4 February 2016, being the Closing Date, in order to accept the Offer. 5. In accordance with the Takeovers Code, an announcement will be issued on the website of the Stock Exchange by 7:00 p.m. on the Closing Date stating the results of the Offer and whether the Offer has been extended, revised or expired. In the event that the Offeror decides to extend the Offer, at least 14 days notice by way of an announcement will be given before the Offer is closed to those Independent Shareholders who have not accepted the Offer. i

4 EXPECTED TIMETABLE 6. Remittances in respect of the cash consideration (after deducting the seller s ad valorem stamp duty) payable for the Offer Shares tendered under the Offer will be made to the Independent Shareholders accepting the Offer by ordinary post at their own risk as soon as possible, but in any event within seven business days (as defined in the Takeovers Code) following the date of receipt by the Registrar of the duly completed Acceptance Form and all the relevant documents to render the acceptance under the Offer complete and valid in accordance with the Takeovers Code. 7. If there is a tropical cyclone warning signal no.8 or above, or a black rainstorm warning: (a) in force in Hong Kong at any local time before 12:00 noon but no longer in force after 12:00 noon on the latest date for acceptance of the Offer or the latest date for posting of remittances for the amounts due under the Offer in respect of valid acceptances, the latest time for acceptance of the Offer or the posting of remittances, as the case may be, will remain at 4:00 p.m. on the same Business Day; or (b) in force in Hong Kong at any local time between 12:00 noon and 4:00 p.m. on the latest date for acceptance of the Offer or the latest time for acceptance of the Offer or the posting of remittances, as the case may be, will be rescheduled to 4:00 p.m. on the following Business Day which does not have either of those warnings in force at any time between 9:00 a.m. and 4:00 p.m. or such other day as the Executive may approve in accordance with the Takeovers Code. ii

5 DEFINITIONS In this Composite Document, the following expressions shall have the following meanings unless the context indicates otherwise: Acceptance Form acting in concert Anglo Chinese associate(s) Board Business Day(s) BVI the form of acceptance and transfer in respect of the Offer accompanying this Composite Document has the same meaning ascribed to it under the Takeovers Code Anglo Chinese Corporate Finance, Limited, a licensed corporation to carry out Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activities under the SFO, being one of the joint financial advisers to the Offeror has the same meaning ascribed to it under the Listing Rules the board of Directors a day(s) on which the banks are open for business in Hong Kong, other than Saturdays, Sundays and public holidays and/or a day on which the Stock Exchange is open for transaction of business (as defined under the Takeovers Code) the British Virgin Islands CCASS the Central Clearing and Settlement System established and operated by HKSCC Closing Date Company Completion 4 February 2016, being the closing date of the Offer as stated in the section headed Expected Timetable in this Composite Document or any subsequent closing date as may be announced by the Offeror in accordance with the Takeovers Code Fittec International Group Limited, a company incorporated in the Cayman Islands with limited liability, the issued shares of which are listed on the Main Board of the Stock Exchange (stock code: 2662) completion of the sale and purchase of the Sale Shares in accordance with the terms and conditions of the Sale and Purchase Agreement, which took place on 11 January

6 DEFINITIONS Completion Date Composite Document Condition(s) connected person(s) CSB CSB Facility CSCF Director(s) the third Business Day after the last of the Conditions having been fulfilled (or waived) on which Completion takes place this composite offer and response document jointly issued by the Offeror and the Company to the Shareholders in connection with the Offer in compliance with the Takeovers Code containing, among other things, details of the Offer, procedures for acceptance and settlement of the Offer, letters from the Independent Board Committee and the Independent Financial Adviser, and the accompanying Acceptance Form the condition(s) precedent to Completion has the same meaning ascribed to it under the Listing Rules China Securities (International) Brokerage Company Limited, a licensed corporation under the SFO to carry out Type 1 (dealing in securities), Type 2 (dealing in futures contracts), Type 4 (advising on securities) and Type 5 (advising on futures contracts) regulated activities and a related company of CSCF, being the lender of the CSB Facility to the Offeror a loan facility of up to approximately HK$700.0 million granted by CSB to the Offeror to finance the amount payable by the Offeror under the Sale and Purchase Agreement (up to approximately HK$515.3 million) and the amount payable by the Offeror upon acceptance of the Offer by the Independent Shareholders (up to approximately HK$184.7 million) China Securities (International) Corporate Finance Company Limited, a licensed corporation under the SFO to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities and a related company of CSB, being one of the joint financial advisers to the Offeror the director(s) of the Company from time to time 2

7 DEFINITIONS Executive Group HKSCC Hong Kong Independent Board Committee Independent Financial Adviser or Nuada Independent Shareholders the Executive Director of the Corporate Finance Division of the SFC or any delegate of the Executive Director the Company and its subsidiaries Hong Kong Securities Clearing Company Limited the Hong Kong Special Administrative Region of the PRC an independent committee of the Board comprising all the independent non-executive Directors, namely Mr. Chung Wai Kwok, Jimmy, Mr. Tam Wing Kin and Mr. Sin Man Yin, established in accordance with the Takeovers Code to give recommendations to the Independent Shareholders in respect of the Offer Nuada Limited, a licensed corporation to carry out type 6 (advising on corporate finance) regulated activity under the SFO, being the independent financial adviser to the Independent Board Committee in respect of the Offer Shareholders other than Ms. Lo, the Vendor, the Offeror and their respective associates and parties acting in concert with any of them Joint Announcement the joint announcement dated 1 December 2015 jointly issued by or for and on behalf of the Offeror and the Company in relation to, among other things, the Sale and Purchase Agreement and the Offer Last Trading Day Latest Practicable Date Listing Rules 20 November 2015, being the last trading day immediately prior to the suspension of trading in the Shares on the Stock Exchange pending the release of the Joint Announcement 11 January 2016, being the latest practicable date prior to the printing of this Composite Document for the purpose of ascertaining information contained herein the Rules Governing the Listing of Securities on the Stock Exchange 3

8 DEFINITIONS MOU Announcement the announcement issued by the Company dated 28 October 2015 in relation to the memorandum of understanding in relation to the sale and purchase of the Sale Shares entered into between the Vendor and Camsing Investment (Group) Company Limited on 27 October 2015 Ms. Lo Offer Offer Period Offer Price Offer Share(s) Offeror Overseas Shareholder(s) PRC Record Date Ms. Lo Ching, the sole beneficial owner and director of the Offeror the unconditional mandatory cash offer being jointly made by Anglo Chinese and CSCF for and on behalf of the Offeror to acquire all the Offer Shares pursuant to Rule 26.1 of the Takeovers Code the period from Wednesday, 28 October 2015, being the date of the MOU Announcement, to 4:00 p.m. on 4 February 2016, or such other time or date to which the Offeror may decide to extend the Offer in accordance with the Takeovers Code the price at which the Offer is made, being HK$ per Offer Share all the Share(s) in issue (other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with it) China Base Group Limited, a company incorporated in BVI with limited liability and wholly and beneficially owned by Ms. Lo Independent Shareholder(s) whose addresses, as shown on the register of members of the Company, are outside Hong Kong the People s Republic of China which, for the purpose of this Composite Document, excludes Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan the date for determining the entitlements of the Shareholders to the Special Dividend, being 6 January

9 DEFINITIONS Registrar Computershare Hong Kong Investor Services Limited, at Shops , 17/F, Hopewell Centre, 183 Queen s Road East, Wan Chai, Hong Kong, the branch registrar of the Company in Hong Kong Relevant Period Sale and Purchase Agreement Sale Shares SFC SFO Share(s) Shareholder(s) Special Dividend Stamp Duty Ordinance Stock Exchange Takeovers Code Vendor the period commencing from 28 April 2015, being the date falling six months preceding the date of the MOU Announcement, up to and including the Latest Practicable Date the sale and purchase agreement dated 24 November 2015 entered into between the Offeror and the Vendor in relation to the sale and purchase of the Sale Shares a total of 720,000,000 Shares acquired by the Offeror pursuant to the terms and conditions of the Sale and Purchase Agreement the Securities and Futures Commission of Hong Kong the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) ordinary share(s) of HK$0.10 each in the issued share capital of the Company holder(s) of the issued Share(s) the special dividend of HK$0.198 per Share declared and approved by the Shareholders at the extraordinary general meeting of the Company held on 28 December 2015, the record date for which was 6 January 2016 the Stamp Duty Ordinance (Chapter 117 of the laws of Hong Kong) The Stock Exchange of Hong Kong Limited the Hong Kong Code on Takeovers and Mergers Fittec Holdings Limited, a company incorporated in BVI with limited liability and is ultimately beneficially owned by Mr. Lam Chi Ho, the chairman and executive Director of the Company 5

10 DEFINITIONS HK$ Hong Kong dollars, the lawful currency of Hong Kong % per cent. 6

11 LETTER FROM ANGLO CHINESE AND CSCF Anglo Chinese Corporate Finance, Limited 40/F, Two Exchange Square, 8 Connaught Place, Central, Hong Kong China Securities (International) Corporate Finance Company Limited 18/F, Two Exchange Square, 8 Connaught Place, Central, Hong Kong 14 January 2016 To the Independent Shareholders Dear Sirs, UNCONDITIONAL MANDATORY CASH OFFER BY ANGLO CHINESE CORPORATE FINANCE LIMITED AND CHINA SECURITIES (INTERNATIONAL) CORPORATE FINANCE COMPANY LIMITED FOR AND ON BEHALF OF CHINA BASE GROUP LIMITED TO ACQUIRE ALL THE ISSUED SHARES OF FITTEC INTERNATIONAL GROUP LIMITED (OTHER THAN THOSE ALREADY OWNED OR AGREED TO BE ACQUIRED BY CHINA BASE GROUP LIMITED AND PARTIES ACTING IN CONCERT WITH IT) References are made to (i) the Joint Announcement in relation to, among other things, the Sale and Purchase Agreement and the possible unconditional mandatory cash offer to be made by Anglo Chinese and CSCF to acquire all the issued Shares (other than those already owned or agreed to be acquired by the Offeror and the parties acting in concert with it); and (ii) the announcement of the Company dated 11 January 2016 in relation to Completion of the Sale and Purchase Agreement. On 24 November 2015, the Vendor and the Offeror entered into the Sale and Purchase Agreement, pursuant to which the Vendor conditionally agreed to sell and the Offeror conditionally agreed to acquire the 720,000,000 Sale Shares free from all encumbrances together with all rights attaching thereto as at the Completion Date, including all rights to any dividend or other distribution declared, made or paid on or after the Completion Date (but excluding the Special Dividend). The total consideration for the Sale Shares is HK$535,320,000 (representing HK$ per Sale Share). The Sale Shares represent (a) all the Sale Shares held by the Vendor; and (b) approximately 74.35% of the total issued share capital of the Company immediately prior to Completion. Completion took place on 11 January

12 LETTER FROM ANGLO CHINESE AND CSCF Upon Completion, the Offeror became interested in a total of 720,000,000 Shares, representing approximately 74.35% of the issued share capital of the Company. Accordingly, the Offeror is required to make an unconditional mandatory cash offer pursuant to Rule 26.1 of the Takeovers Code for all the issued Shares (other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with it). As at the date of this Composite Document, the Company has 968,394,000 ordinary Shares in issue. Save for the aforesaid, the Company has no other relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code) as at the date of this Composite Document. This letter set outs, among other things, the principal terms of the Offer, together with the information on the Offeror and the Offeror s intention regarding the Group. Further details of the terms of the Offer and procedures of acceptance are also set out in Appendix I to this Composite Document and the accompanying Acceptance Form. The Independent Shareholders are strongly advised to consider carefully the information contained in the Letter from the Board, the Letter from the Independent Board Committee, and the Letter from the Independent Financial Adviser in respect of the Offer as set out in this Composite Document and to consult their professional advisers if in doubt. UNCONDITIONAL MANDATORY CASH OFFER Anglo Chinese and CSCF, for and on behalf of the Offeror, are making the Offer, which is unconditional in all respects pursuant to Note 1 to Rule 26.2 of the Takeovers Code, to acquire all the Offer Shares in compliance with the Takeovers Code on the following basis: The Offer For every Offer Share...HK$ in cash The Offer Price is the same as the purchase price per Sale Share paid by the Offeror under the Sale and Purchase Agreement. The Offer Shares to be acquired under the Offer shall be fully paid and free from all encumbrances together with all rights attached thereto, including but not limited to all rights to any dividend or other distribution (excluding the Special Dividend) declared, made or paid on or after the date on which the Offer is made, being the date of posting of this Composite Document. For the avoidance of doubt, any Shareholder whose name appears on the Company s principal or branch share register on the Record Date and subsequently accepts the Offer would still be entitled to the Special Dividend. Shareholders will be entitled to the Special Dividend irrespective of whether they accept the Offer or not. 8

13 LETTER FROM ANGLO CHINESE AND CSCF Value of the Offer As at the Latest Practicable Date, there were 968,394,000 Shares in issue and the Company did not have any other outstanding options, derivatives, warrants or securities which are convertible or exchangeable into Shares and has not entered into any agreement for the issue of such options, derivatives, warrants or securities which are convertible or exchangeable into Shares. Based on the Offer Price of HK$ per Offer Share, the entire issued share capital of the Company would be valued at approximately HK$720.0 million. Immediately after Completion, assuming that there is no change in the issued share capital of the Company from the Latest Practicable Date up to the Closing Date, there will be 248,394,000 Shares subject to the Offer. Accordingly, the value of the Offer is approximately HK$184.7 million. Comparison of value The Offer Price of HK$ per Offer Share represents: (i) (ii) (iii) (iv) (v) (vi) (vii) a discount of approximately 34.8% to the closing price of HK$1.140 per Share as quoted on the Stock Exchange as at 27 October 2015, being the last Business Day prior to the commencement of the Offer Period; a discount of approximately 54.9% to the closing price of HK$1.650 per Share as quoted on the Stock Exchange on the Last Trading Day; a discount of approximately 53.2% to the average of the closing prices of Shares as quoted on the Stock Exchange for the last five consecutive trading days up to and including the Last Trading Day of approximately HK$1.588 per Share; a discount of approximately 47.3% to the average of the closing prices of Shares as quoted on the Stock Exchange for the last 10 consecutive trading days up to and including the Last Trading Day of approximately HK$1.411 per Share; a discount of approximately 37.8% to the average of the closing prices of Shares as quoted on the Stock Exchange for the last 30 consecutive trading days up to and including the Last Trading Day of approximately HK$1.196 per Share; a discount of approximately 38.0% to the closing price of HK$1.200 per Share as quoted on the Stock Exchange on the Latest Practicable Date; a premium of approximately 45.8% over the audited consolidated net asset value per Share of approximately HK$0.510 per Share as at 30 June 2015, being the date of the latest annual results of the Company (based 9

14 LETTER FROM ANGLO CHINESE AND CSCF on the audited consolidated net asset value of the Group as at 30 June 2015 of approximately HK$493.6 million and 968,394,000 Shares in issue as at the Latest Practicable Date); and (viii) a premium of approximately 138.3% over the ex-dividend consolidated net asset value per Share of approximately HK$0.312 per Share as at 30 June 2015, being the date of the latest annual results of the Company (based on the audited consolidated net asset value of the Group as at 30 June 2015 of approximately HK$493.6 million, the Special Dividend of HK$0.198 per Share declared and 968,394,000 Shares in issue as at the Latest Practicable Date). Highest and lowest Share prices During the Relevant Period, the highest closing price of the Shares as quoted on the Stock Exchange was HK$1.94 per Share on 23 June 2015 and the lowest closing price of the Shares as quoted on the Stock Exchange was HK$0.84 per Share on 8 July 2015 and 2 September Financial resources available to the Offeror As the Offeror and parties acting in concert with it have acquired an aggregate of 720,000,000 Shares immediately after Completion, the total number of Shares subject to the Offer will be 248,394,000 Shares. As such, the maximum amount payable by the Offeror under the Offer will be approximately HK$184.7 million in the event that the Offer is fully accepted by the Independent Shareholders. The Offeror intends to finance and satisfy the total consideration payable under the Offer through the CSB Facility. Pursuant to the terms of the CSB Facility, (i) the Sale Shares acquired by the Offeror under the Sale and Purchase Agreement and the Shares to be acquired pursuant to the Offer shall be, and will be, charged to CSB as security; and (ii) Ms. Lo shall and has executed a personal guarantee for the obligations and liabilities of the Offeror under the CSB Facility. The Offeror does not intend that the payment of interest on, repayment of or security for any liability will depend to any significant extent on the business of the Group. Anglo Chinese and CSCF are satisfied that sufficient financial resources are available to the Offeror to satisfy the full acceptance of the Offer as described above. Conditions The Offer is unconditional in all respects. Effect of accepting the Offer By accepting the Offer, the relevant Independent Shareholders will sell their Shares to the Offeror free from all encumbrances and together with all rights attached to them, including but not limited to the right to all dividends and 10

15 LETTER FROM ANGLO CHINESE AND CSCF distributions (but excluding the Special Dividend) declared, made or paid, if any, on or after the date on which the Offer is made (i.e. being the date of the posting of this Composite Document). Acceptance of the Offer by any Shareholder will be deemed to constitute a warranty by such person that all Shares sold by such person under the Offer are free from all encumbrances and together with all rights attached to them, including but not limited to the rights to all dividends and distributions (but excluding the Special Dividend) declared, made or paid, if any, on or after the date on which the Offer is made. Acceptances of the Offer shall be irrevocable and not capable of being withdrawn, except as permitted under the Takeovers Code. For the avoidance of doubt, any Shareholder whose name appears on the Company s principal or branch share register on the Record Date and subsequently accepts the Offer would still be entitled to the Special Dividend. Shareholders will be entitled to the Special Dividend irrespective of whether they accept the Offer or not. Terms and procedures for acceptance of the Offer are set out in Appendix I to this Composite Document and the accompanying Acceptance Form. The Independent Shareholders are reminded to read the recommendations of the Independent Board Committee and the advice of Nuada appointed by the Independent Board Committee in respect of the Offer which are included in this Composite Document. Payment Payment in cash in respect of acceptance of the Offer will be made as soon as possible but in any event within seven business days (as defined in the Takeovers Code) following the date of receipt by the Registrar of the duly completed Acceptance Form and all the relevant documents to render the acceptance under the Offer complete and valid in accordance with the Takeovers Code. Taxation advice Independent Shareholders are recommended to consult their own professional advisers if they are in any doubt as to the taxation implications of accepting or rejecting the Offer. None of the Offeror, parties acting in concert with the Offeror, the Vendor, the Company, Anglo Chinese, CSCF and their respective ultimate beneficial owners, directors, officers, advisers, agents or associates or any other person involved in the Offer accepts responsibility for any taxation effects on, or liabilities of, any persons as a result of their acceptance or rejection of the Offer. Overseas Shareholders The availability of the Offer to any Overseas Shareholders may be affected by the applicable laws and regulations of their relevant jurisdictions of residence. 11

16 LETTER FROM ANGLO CHINESE AND CSCF Overseas Shareholders should observe any applicable legal or regulatory requirements and, where necessary, consult their own legal advisers. It is the responsibilities of the Overseas Shareholders who wish to accept the Offer to satisfy themselves as to the full observance of the laws and regulations of the relevant jurisdictions in connection with the acceptance of the Offer (including the obtaining of any governmental or other consent which may be required or the compliance with other necessary formalities and the payment of any transfer or other taxes due by such Overseas Shareholders in respect of such jurisdictions). Hong Kong stamp duty In Hong Kong, the seller s ad valorem stamp duty arising in connection with acceptances of the Offer will be payable by the relevant Independent Shareholders at a rate of 0.1% of (i) the market value of the Offer Shares; or (ii) consideration payable by the Offeror in respect of the relevant acceptances of the Offer, whichever is higher, and will be deducted from the cash amount payable by the Offeror to the relevant Independent Shareholders accepting the Offer. The Offeror will arrange for payment of the seller s ad valorem stamp duty on behalf of the relevant Independent Shareholders accepting the Offer and will pay the buyer s ad valorem stamp duty in connection with the acceptance of the Offer and the transfer of the Shares in accordance with the Stamp Duty Ordinance. Acceptance and Settlement Your attention is further drawn to the details regarding the procedures for acceptance and settlement of the Offer as set out in Appendix I to this Composite Document and the accompanying Acceptance Form. SHAREHOLDING STRUCTURE OF THE COMPANY The following table sets out the shareholding structure of the Company (a) immediately before Completion; and (b) immediately after Completion and as at the Latest Practicable Date: Immediately before Completion Number of Approximate Shares % Immediately after Completion and as at the Latest Practicable Date Number of Shares Approximate % The Offeror and parties acting in concert with it 720,000, The Vendor 720,000, Public Shareholders 248,394, ,394, Total 968,394, ,394,

17 LETTER FROM ANGLO CHINESE AND CSCF INFORMATION ON THE GROUP Details of the information on the Group are set out in the Letter from the Board to this Composite Document. INFORMATION ON THE OFFEROR The Offeror is an investment holding company incorporated on 6 October 2003 in BVI with limited liability and as at the Latest Practicable Date, the Offeror is wholly-owned by Ms. Lo, who is also the sole director of the Offeror. Ms. Lo is the executive chairman and the sole ultimate beneficial owner of Guangzhou Camsing Limited Company ( ), a company incorporated in the PRC, whose principal business includes brand licensing, promotion and distribution of consumer products. She holds two EMBA degrees from Hong Kong University of Science and Technology and HEC business school in Paris. OFFEROR S INTENTION ON THE COMPANY It is the intention of the Offeror to continue with the existing principal business of the Group following the close of the Offer. On the other hand, following the close of the Offer, the Offeror will conduct a thorough review of the business operations and financial position of the Group in order to formulate an applicable business strategy for the Group. The Offeror will also explore suitable business opportunities and consider appropriate investment for the Group that would contribute to the growth of its business and asset base as well as to broaden its revenue stream. As at the Latest Practicable Date, the Offeror has no definitive proposal in relation to the injection of any assets or businesses into the Group. The Offeror has no intention to terminate the employment of the employees or to make significant changes to any employment of the Group (save for the proposed changes to the composition of the Board as set out below) or to dispose of or re-deploy the assets of the Group. Compulsory Acquisition The Offeror does not intend to exercise any power of compulsory acquisition of any Offer Shares outstanding and not acquired under the Offer after the close of the Offer. Dealing and interests in securities of the Company Save for the Sale Shares acquired under the Sale and Purchase Agreement that are held as at the Latest Practicable Date, none of the Offeror, its ultimate beneficial owner, and/or parties acting in concert with any of them had dealt for value in any Shares, options, derivatives, warrants or other securities convertible or exchangeable into Shares during the Relevant Period. PROPOSED CHANGE OF BOARD COMPOSITION The Board is currently made up of six Directors, comprising three executive Directors, namely Mr. Lam Chi Ho, Ms. Sun Mi Li and Mr. Tsuji Tadao; and three 13

18 LETTER FROM ANGLO CHINESE AND CSCF independent non-executive Directors, namely Mr. Chung Wai Kwok, Jimmy, Mr. Tam Wing Kin and Mr. Sin Man Yin. It is intended that all of the six Directors will resign after Completion and with effect from the earliest time permitted under the Takeovers Code. The Offeror intends to nominate new Directors to the Board at the earliest time as allowed under the Takeovers Code and any such appointment will be made in compliance with the Takeovers Code and the Listing Rules. To ensure that there will be continuity in the management of the Group s business, Mr. Lam Chi Ho, Ms. Sun Mi Li and Mr. Tsuji Tadao (being existing executive Directors) shall remain as directors of the Group s subsidiaries. The existing directors service agreements with the three executive Directors will be terminated after their resignation as Directors takes effect and the Group s subsidiaries will enter into new employment contracts with them on the same terms and conditions (including duration of the agreements) with their existing agreements after Completion. Any changes to the Board composition will be made in compliance with the Takeovers Code and the Listing Rules. Further announcement will be made on any further proposed change of the composition of the Board. MAINTAINING THE LISTING STATUS OF THE COMPANY The Offeror intends to maintain the listing of the Shares on the Main Board of the Stock Exchange after the close of the Offer. In the event that after the close of the Offer, the public float of the Company falls below 25%, the sole director of the Offeror and the new Directors who will be nominated by the Offeror and to be appointed as Directors will jointly and severally undertake to the Stock Exchange that they will take appropriate steps to ensure that sufficient public float exists for the Shares following the close of the Offer. The Stock Exchange has stated that if, upon closing of the Offer, less than the minimum prescribed percentage applicable to the Company, being 25% of the issued Shares, are held by the public or if the Stock Exchange believes that (i) a false market exists or may exist in the trading of the Shares; or (ii) there are insufficient Shares in public hands to maintain an orderly market, it will consider exercising its discretion to suspend trading in the Shares until the prescribed level of public float is restored. GENERAL To ensure equality of treatment of all Independent Shareholders, those registered Independent Shareholders who hold the Offer Shares as nominees for more than one beneficial owner should, as far as practicable, treat the holding of each beneficial owner separately. It is essential for the beneficial owners of the Offer Shares whose investments are registered in the names of nominees to provide instructions to their nominees of their intentions with regard to the Offer. The attention of the Overseas Shareholders is drawn to the section headed Overseas Shareholders in Appendix I to this Composite Document. All documents and remittances will be sent to the Independent Shareholders by ordinary post at their own risk. These documents and remittances will be sent to them at their respective addresses as they appear in the register of members, or, in case of joint 14

19 LETTER FROM ANGLO CHINESE AND CSCF holders to the Independent Shareholder whose name appears first in the said register of members, unless otherwise specified in the accompanying Acceptance Form completed, returned and received by the Registrar. None of the Offeror and parties acting in concert with it, the Company, Anglo Chinese, CSCF nor any of their respective directors, officers, professional advisers, associates, agents or any other parties involved in the Offer accepts any liabilities for any loss in postage or any other liabilities that may arise as a result thereof. ADDITIONAL INFORMATION Your attention is drawn to the Letter from the Board, the Letter from the Independent Board Committee and the Letter from the Independent Financial Adviser as set out in this Composite Document, the accompanying Acceptance Form and the additional information set out in the appendices to, which form part of, this Composite Document. Yours faithfully, for and on behalf of Anglo Chinese Corporate Finance, Limited Dennis Cassidy Head of Corporate Finance Yours faithfully, for and on behalf of China Securities (International) Corporate Finance Company Limited Winnie Yau Executive Director of Corporate Finance 15

20 LETTER FROM THE BOARD Fittec International Group Limited (Incorporated in the Cayman Islands with limited liability) (Stock Code: 2662) Executive Directors: Mr. Lam Chi Ho Ms. Sun Mi Li Mr. Tsuji Tadao Independent non-executive Directors: Mr. Chung Wai Kwok, Jimmy Mr. Tam Wing Kin Mr. Sin Man Yin Registered office: Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY Cayman Islands Head office and principal place of business in Hong Kong: Unit 9, 9/F Yuen Long Trading Centre 33 Wang Yip Street West Yuen Long New Territories Hong Kong 14 January 2016 To the Independent Shareholders, Dear Sirs, UNCONDITIONAL MANDATORY CASH OFFER BY ANGLO CHINESE CORPORATE FINANCE LIMITED AND CHINA SECURITIES (INTERNATIONAL) CORPORATE FINANCE COMPANY LIMITED FOR AND ON BEHALF OF CHINA BASE GROUP LIMITED TO ACQUIRE ALL THE ISSUED SHARES OF FITTEC INTERNATIONAL GROUP LIMITED (OTHER THAN THOSE ALREADY OWNED OR AGREED TO BE ACQUIRED BY CHINA BASE GROUP LIMITED AND PARTIES ACTING IN CONCERT WITH IT) INTRODUCTION References are made to the Joint Announcement and the announcement of the Company dated 11 January 2016 in relation to Completion of the Sale and Purchase Agreement. 16

21 LETTER FROM THE BOARD As announced in the Joint Announcement, on 24 November 2015, the Vendor and the Offeror entered into the Sale and Purchase Agreement, pursuant to which the Vendor agreed to sell and the Offeror agreed to acquire the Sale Shares, representing approximately 74.35% of the total issued share capital of the Company as at the date of the Joint Announcement for a total consideration of HK$535,320,000, equivalent to HK$ per Share. It was announced on 11 January 2016 that the Completion took place on 11 January 2016, whereby the Vendor had sold and the Offeror had acquired the Sale Shares and the consideration had been fully paid by the Offeror to the Vendor. The Sale Shares were sold together with all rights attaching to the Sale Shares as at the Completion Date, including all rights to any dividend or other distribution declared, made or paid on or after the Completion Date (but excluding the Special Dividend). The Special Dividend payable to the Vendor amounts to approximately HK$191.7 million, being the Special Dividend in respect of the Sale Shares held by the Vendor on the date for determining the entitlements of the Shareholders to the Special Dividend. Immediately following Completion, the Offeror and parties acting in concert with it were interested in a total of 720,000,000 Shares, representing approximately 74.35% of the entire issued share capital of the Company as at the Latest Practicable Date. Pursuant to Rule 26.1 of the Takeovers Code, the Offeror is required to make an unconditional mandatory cash offer for all the issued Shares (other than those already owned or agreed to be acquired by the Offeror and parties acting in concert with it). The purpose of this Composite Document, of which this letter forms part, is to provide you with, among others, information relating to the Group and the Offer as well as setting out the letter from the Independent Board Committee containing its recommendation and advice to the Independent Shareholders in respect of the Offer and the letter from the Independent Financial Adviser containing its advice to the Independent Board Committee in respect of the Offer. THE OFFER The Letter from Anglo Chinese and CSCF set out on pages 7 to 15 of this Composite Document contains the information in respect of the Offer including those set out below. According to the Letter from Anglo Chinese and CSCF, Anglo Chinese and CSCF, on behalf of the Offeror, are making the Offer to all the Independent Shareholders to acquire all the Offer Shares in compliance with the Takeovers Code on the terms to be set out in this Composite Document on the following basis: For each Offer Share...HK$ in cash 17

22 LETTER FROM THE BOARD The Offer Shares to be acquired under the Offer shall be fully paid and free from all encumbrances together with all rights attached thereto, including but not limited to all rights to any dividend or other distribution (excluding the Special Dividend) declared, made or paid on or after the date on which the Offer is made, being the date of the despatch of this Composite Document. In this connection, the record date for ascertaining the entitlement to the Special Dividend fell on 6 January 2016 and the payment of the Special Dividend will be made on 13 January For the avoidance of doubt, for the Shareholders who will be entitled to receive the Special Dividend, acceptance of the Offer shall not prejudice their entitlement to receive such Special Dividend. Shareholders will be entitled to the Special Dividend irrespective of whether they accept the Offer or not. As at the Latest Practicable Date, the Company had 968,394,000 ordinary Shares in issue and the Company had no outstanding warrants, options, derivatives in respect of the Shares or securities convertible into Shares. Further details of the Offer You are advised to refer to the letter from Anglo Chinese and CSCF set out on pages 7 to 15 of this Composite Document for further terms and conditions of the Offer and the procedures for acceptance and settlement of the Offer as set out in Appendix I to this Composite Document and the Acceptance Form. INFORMATION ON THE OFFEROR Your attention is drawn to the section headed Information on the Offeror in the Letter from Anglo Chinese and CSCF set out in this Composite Document for the information of the Offeror. INFORMATION ON THE GROUP The Company was incorporated in the Cayman Islands with limited liability and the issued shares of which are listed on the Main Board of the Stock Exchange. The principal activity of the Company is investment holding. The Group is principally engaged in the manufacturing and sales of printed circuit board, electronics components and related parts; and the provision of repair and maintenance services. Your attention is drawn to Appendices II and III to this Composite Document which contain further financial and general information of the Group. 18

23 LETTER FROM THE BOARD SHAREHOLDING STRUCTURE OF THE COMPANY The following table sets out the shareholding structure of the Company (i) immediately before Completion; and (ii) immediately after Completion and as at the Latest Practicable Date: Immediately before Completion Number of Approximate Shares % Immediately after Completion and as at the Latest Practicable Date Number of Shares Approximate % The Offeror and parties acting in concert with it 720,000, The Vendor 720,000, Public Shareholders 248,394, ,394, Total 968,394, ,394, OFEROR S INTENTION ON THE GROUP AND PROPOSED CHANGE OF BOARD COMPOSITION Your attention is drawn to the sections headed Offeror s Intention on the Company and Proposed Change of Board Composition in the Letter from Anglo Chinese and CSCF as set out in this Composite Document for the Offeror s intention with respect to the Group and the proposed change of the composition of the Board. The Board is aware of the Offeror s intention in respect of the Group and is willing to co-operate with the Offeror and act in the best interests of the Company and its Shareholders as a whole. MAINTAINING THE LISTING STATUS OF THE COMPANY The Board noted from the Letter from Anglo Chinese and CSCF that the Offeror intends to maintain the listing of the Shares on the Main Board of the Stock Exchange after the close of the Offer. The sole director of the Offeror has undertaken, and the proposed Directors who will be nominated by the Offeror and to be appointed as new Directors will jointly and severally undertake to the Stock Exchange that they will take appropriate steps to ensure that sufficient public float exists for the Shares if the public float of the Company falls below 25% following the close of the Offer. The Stock Exchange has stated that if, upon closing of the Offer, less than the minimum prescribed percentage applicable to the Company, being 25% of the issued Shares, are held by the public or if the Stock Exchange believes that (i) a false market exists or may exist in the trading of the Shares; or (ii) there are insufficient Shares in public hands to maintain an orderly market, it will consider exercising its discretion to suspend trading in the Shares until the prescribed level of public float is restored. 19

24 LETTER FROM THE BOARD INDEPENDENT BOARD COMMITTEE AND INDEPENDENT FINANCIAL ADVISER An Independent Board Committee, comprising all independent non-executive Directors, namely Mr. Chung Wai Kwok, Jimmy, Mr. Tam Wing Kin and Mr. Sin Man Yin, has been established to make a recommendation to the Independent Shareholders regarding the Offer. Nuada has been appointed with the approval of the Independent Board Committee as the Independent Financial Adviser to advise the Independent Board Committee in respect of the Offer. RECOMMENDATION Your attention is drawn to (i) the letter from the Independent Board Committee on pages 21 to 22 of this Composite Document, which sets out the recommendations to the Independent Shareholders in respect of the Offer; and (ii) the letter from Nuada on pages 23 to 44 of this Composite Document, which sets out its recommendation and advice to the Independent Board Committee as to the fairness and reasonableness of the Offer and as to acceptance of the Offer, and the principal factors and reasons it has considered before arriving at its advice. ADDITIONAL INFORMATION You are recommended to read this Composite Document and the Acceptance Form for information relating to the terms of the Offer and procedures for acceptance and settlement of the Offer. Your attention is also drawn to the additional information set out in the appendices to this Composite Document. Yours faithfully, By order of the Board of Fittec International Group Limited Lam Chi Ho Chairman Hong Kong, 14 January

25 LETTER FROM THE INDEPENDENT BOARD COMMITTEE Fittec International Group Limited (Incorporated in the Cayman Islands with limited liability) (Stock Code: 2662) 14 January 2016 To the Independent Shareholders Dear Sirs, UNCONDITIONAL MANDATORY CASH OFFER BY ANGLO CHINESE CORPORATE FINANCE LIMITED AND CHINA SECURITIES (INTERNATIONAL) CORPORATE FINANCE COMPANY LIMITED FOR AND ON BEHALF OF CHINA BASE GROUP LIMITED TO ACQUIRE ALL THE ISSUED SHARES OF FITTEC INTERNATIONAL GROUP LIMITED (OTHER THAN THOSE ALREADY OWNED OR AGREED TO BE ACQUIRED BY CHINA BASE GROUP LIMITED AND PARTIES ACTING IN CONCERT WITH IT) We refer to the Composite Document dated 14 January 2016 jointly issued by the Offeror and the Company, of which this letter forms part. Unless specified otherwise, capitalised terms used herein shall have the same meanings as those defined in the Composite Document. We have been appointed as the members of the Independent Board Committee to advise the Independent Shareholders as to whether, in our opinion, the terms of the Offer are fair and reasonable so far as the Independent Shareholders are concerned and to make a recommendation as to acceptance of the Offer. Nuada has been appointed as the Independent Financial Adviser to advise us in these regard. We also wish to draw your attention to the letter from Anglo Chinese and CSCF, the letter from the Board, the letter from Nuada as set out in the Composite Document as well as the additional information set out in the appendices to the Composite Document. 21