Northern New Energy Holdings Limited

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. Northern New Energy Holdings Limited (Incorporated in the Cayman Islands with limited liability) (Stock code: 8246) DISCLOSEABLE TRANSACTION THE SALE AND PURCHASE AGREEMENT On 5 January 2018 (after Stock Exchange trading hours), the Purchaser (a non-wholly owned subsidiary of the Company), the Vendors and the Target Company entered into the Sale and Purchase Agreement pursuant to which the Purchaser has conditionally agreed to purchase and the Vendors have conditionally agreed to sell 91% of the registered capital of the Target Company at the aggregate consideration of RMB78,400,000 (equivalent to approximately HK$94,393,600). The Target Company is permitted to engage in sale of natural gas; gas pipeline engineering; sale, installation and maintenance of gas transmission equipment; development, consultation, service and transfer of heat supply technology; development of new energy technology; leasing and commercial services industry; installation of electric and mechanical equipment; and centralized urban heat supply service. As at the date of the Sale and Purchase Agreement, it holds two LNG stations in Tianjin, the PRC. Completion is subject to fulfilment of the conditions precedent as set out in the paragraph headed Conditions precedent of the section headed The Sale and Purchase Agreement of this announcement. 1

2 GEM LISTING RULES IMPLICATIONS As the relevant applicable percentage ratios (as defined under the GEM Listing Rules) of the Acquisition exceed 5% but are less than 25%, the Acquisition constitutes a discloseable transaction of the Company under Chapter 19 of the GEM Listing Rules. As Completion is subject to fulfilment of the conditions precedent, the sale and purchase of the Target Company may or may not proceed. Shareholders and potential investors of the Company should exercise caution when dealing in the securities of the Company. BACKGROUND Reference is made to the announcement of the Company dated 17 November 2017 in relation to the signing of a memorandum of understanding on the Group s possible acquisition of a company to be engaged in development and operation of LNG stations and related facilities. The Board is pleased to announce based on the said memorandum of understanding, after the Stock Exchange trading hours on 5 January 2018, the Purchaser (a non-wholly owned subsidiary of the Company), the Vendors and the Target Company entered into the Sale and Purchase Agreement, pursuant to which the Purchaser conditionally agreed to acquire 91% of the registered capital of the Target Company at the aggregate consideration of RMB78,400,000 (equivalent to approximately HK$94,393,600). Detailed terms of the Sale and Purchase Agreement are set out below. THE SALE AND PURCHASE AGREEMENT Date 5 January 2018 (after the Stock Exchange trading hours) Parties (i) Purchaser: the Purchaser, being (Hua Xia Northern Technology Development (Tianjin) Limited*), a non-wholly owned subsidiary of the Company; 2

3 (ii) Vendors: (a) Mr. Zhang; and (b) Mr. Li; (iii) Target: the Target Company, being (Tianjin Jin Re Natural Gas Sales Company Limited*). To the best of the Directors knowledge, information and belief having made all reasonable enquiries, the Vendors are third parties independent of the Group and its connected persons in accordance with the GEM Listing Rules. Assets to be acquired 91% of the registered capital of the Target Company, amounting to RMB18,200,000 (equivalent to approximately HK$21,912,800). As at the date of the Sale and Purchase Agreement, the entire registered capital of the Target Company is owned as to 50% by Mr. Zhang and as to 50% by Mr. Li. Mr. Zhang and Mr. Li shall each transfer 45.5% of the registered capital of the Target Company, amounting to RMB9,100,000 (equivalent to approximately HK$10,956,400) each to the Purchaser. Consideration The aggregate consideration for the Acquisition of RMB78,400,000 (equivalent to approximately HK$94,393,600) was determined after arm s length negotiations between the Vendors and the Purchaser after taking into account (i) the unaudited net asset value of the Target Company as at 31 December 2017; (ii) an independent valuation of the Target Company s assets of not less than RMB77,998,255 (equivalent to approximately HK$93,909,899) having been issued before Completion; and (iii) the business prospect of the Target Company. The aggregate consideration of RMB78,400,000 (equivalent to approximately HK$94,393,600) shall be payable in cash on the Completion Date. The Group will finance the Acquisition by its internal resources. 3

4 Conditions precedent Completion is subject to fulfilment of the following conditions precedent: (i) (ii) the representations and warranties given by the Vendors and the Target Company in the Acquisition transaction documents remaining true and accurate, and not misleading in all respects; there being no requests from or to any governmental authorities in relation to the Vendors or the Target Company which may restrict the Acquisition or which may have any material adverse effect on the Acquisition; (iii) there being no adjudication, administrative procedures or dispute resolution, the rulings of which may have material adverse effect on the Vendors, the Target Company or the Acquisition; (iv) (v) (vi) all necessary internal consents and approvals required to be obtained on the part of the Vendors and the Target Company in respect of the Acquisition having been obtained; there being no law, administrative orders or judgment having been enacted or granted which would restrict or render the Acquisition becoming illegal; all necessary registration, filing, licence and approval that need to be obtained by the Vendors and the Target Company in relation to the Acquisition having been obtained; (vii) the valuation institution approved by the Purchaser having issued a valuation report in relation to the Target Company s assets, the value of which shall be not less than RMB77,998,255 (equivalent to approximately HK$93,909,899), and the form and content of the valuation report shall be satisfactory to the Purchaser; (viii) the PRC legal advisers engaged by the Purchaser having issued a legal opinion in relation to the Target Company, and the content of which shall be satisfactory to the Purchaser; and (ix) the Purchaser being satisfied with the results of the due diligence review to be conducted on the legal, financial, operational, and tax related aspects of the Target Company. None of the above conditions precedent can be waived. If the above conditions precedent have not been satisfied on or before the Long Stop Date, the Purchaser shall be entitled to terminate the Sale and Purchase Agreement. 4

5 Completion Upon fulfilment of all conditions precedent set out above (or such other date as the Purchaser, the Vendors and the Target Company may agree in writing), the Vendors and Purchaser shall apply for registration of Target Company s change of shareholders at the relevant Authority of Industry and Commerce of the PRC (the Registration ). The Registration shall be completed within 20 business days, and the date of completing the Registration whereupon the Purchaser have become holder of 91% interests of the Target Company shall be the Completion Date. Upon Completion, the Target Company shall become a non-wholly owned subsidiary of the Company and its financial results shall be consolidated into those of the Company s. INFORMATION ON THE TARGET COMPANY The Target Company is a company established in the PRC in 2015 with limited liability. The Target Company did not engage in any business activities before As at the date of the Sale and Purchase Agreement, the Target Company s registered capital is RMB20,000,000 (equivalent to approximately HK$24,080,000), which is held as to 50% by Mr. Zhang and as to 50% by Mr. Li. The Target Company is permitted to engage in sale of natural gas; gas pipeline engineering; sale, installation and maintenance of gas transmission equipment; development, consultation, service and transfer of heat supply technology; development of new energy technology; leasing and commercial services industry; installation of electric and mechanical equipment; centralized urban heat supply service. A summary of the financial information of the Target Company prepared in accordance with PRC GAAP is set out below: For the year ended 31 December (RMB) (RMB) (audited) (unaudited) Loss before tax nil 314,259 Loss after tax nil 314,259 5

6 As at 31 December 2017 (RMB) (unaudited) Net asset value 78,397,742 As at the date of the Sale and Purchase Agreement, the Target Company holds the following assets: (i) LNG station 1 a. location: next to the North Outer Ring Line in Beichen District, Tianjin; b. coverage/capacity: the station, being the largest LNG storage tank in Tianjin, can satisfy the needs of approximately four 80-tonne gas-fired boilers and one 40-tonne gas-fired boilers for generation of heat; c. tank size: approximately 2,000 m 3 ; and d. gasification scale: approximately eight 5,000 m 3 LNG carburetors. (ii) LNG station 2 a. location: in the Beichen Industrial Park in Beichen District, Tianjin; b. coverage/capacity: the station, comprising two 60 m 3 LNG storage tanks, can satisfy the needs of approximately two 20-tonne steam-fired boilers and one 10-tonne steam-fired boiler; c. tank size: approximately 120 m 3 ; and d. gasification scale: approximately two 3500 m 3 LNG carburetors. As at the date of this announcement, the Target Company has entered into a co-operation agreement (the Co-operation Agreement ) with (Tianjin Beichen Heat-Supply Company*) (the Co-operation Partner ), for the period commencing from 1 January 2018 and ending on (i) the date when the Target Company has obtained Dangerous Chemicals Business Operation License * ( ) and Gas Business Operation License * ( ); or (ii) such other date as may be 6

7 agreed by the parties to the Co-operation Agreement, whichever is later. Pursuant to the Co-operation Agreement, the Target Company has, among other matters, leased its LNG storage tanks and gasification device to the Co-operation Partner during the statutory heat supply period in the PRC at the rent of RMB40,000 (equivalent to approximately HK$48,160) per day. The Target Company is also entitled to a management fee of RMB25,000 (equivalent to approximately HK$30,100) per day during the statutory heat supply period in the PRC. To the best of the Directors knowledge, information and belief having made all reasonable enquiries, the Co-operation Partner and its ultimate beneficial owners are third parties independent of the Group and its connected persons. REASONS FOR THE ACQUISITION The Group is principally engaged in the new energy development business, research and development on its relevant technologies and construction engineering. The Group also participated in the operation of restaurants, provision of management services, sale of processed food and seafood, as well as property investment business. The Board considers that the Acquisition is in line with the development strategies of the Group as a whole. The Board considers that the Acquisition will enable the Company to extend its new energy business to the provision of LNG in Tianjin, the PRC. It is also expected that the Acquisition will enable the Group to broaden its revenue stream in future. Based on the above, the Board considers the terms of the Sale and Purchase Agreement and the transactions contemplated thereunder are fair and reasonable, and the Acquisition is in the interests of the Company and the Shareholders as a whole. GEM LISTING RULES IMPLICATIONS As the relevant applicable percentage ratios (as defined under the GEM Listing Rules) of the Acquisition exceed 5% but are less than 25%, the Acquisition constitutes a discloseable transaction of the Company under Chapter 19 of the GEM Listing Rules. As Completion is subject to fulfilment of the conditions precedent, the Acquisition may or may not proceed. Shareholders and potential investors of the Company should exercise caution when dealing in the securities of the Company. 7

8 DEFINITIONS In this announcement, the following expressions shall, unless the context requires otherwise, have the following meanings: Acquisition the proposed acquisition of 91% of the registered capital of the Target Company by the Purchaser pursuant to the terms and conditions of the Sale and Purchase Agreement Board the board of Directors Company Northern New Energy Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the issued Shares of which are listed on GEM (stock code: 8246) Completion completion of the Acquisition in accordance with the terms and conditions of the Sale and Purchase Agreement Completion Date the date of Completion connected person(s) has the meaning ascribed to it under the GEM Listing Rules Director(s) director(s) of the Company GEM the Growth Enterprise Market of the Stock Exchange GEM Listing Rules the Rules Governing the Listing of Securities on GEM Group the Company and its subsidiaries Hong Kong the Hong Kong Special Administrative Region of the PRC LNG liquefied natural gas Long Stop Date 30 June 2018 or such other date as may be agreed by the Purchaser, the Vendors and the Target Company in writing 8

9 Mr. Li Mr. Zhang PRC PRC GAAP Purchaser Sale and Purchase Agreement Share(s) Shareholder(s) Stock Exchange Target Company Vendors HK$ RMB Mr. Li Shu Qi ( ) Mr. Zhang Hu ( ) the People s Republic of China which, for the purpose of this announcement, excludes Hong Kong, the Macau Special Administrative Region and Taiwan generally accepted accounting principles in the PRC (Hua Xia Northern Technology Development (Tianjin) Limited*), a company established in the PRC with limited liability and a non-wholly owned subsidiary of the Company the share transfer agreement dated 5 January 2018 entered into between the Purchaser, the Vendors and the Target Company in respect of the Acquisition ordinary share(s) of HK$ each in the share capital of the Company holder(s) of the Share(s) The Stock Exchange of Hong Kong Limited (Tianjin Jin Re Natural Gas Sales Company Limited*), a company established in the PRC with limited liability Mr. Zhang and Mr. Li Hong Kong dollars, the lawful currency of Hong Kong Renminbi, the lawful currency of the PRC % per cent. 9

10 For the purpose of this announcement, the conversion rate of RMB to HK$ is 1: By order of the Board of Northern New Energy Holdings Limited Chan Wing Yuen, Hubert Chief executive officer and executive Director Hong Kong, 5 January 2018 As at the date of this announcement, the executive Directors are Mr. Hu Yishi, Mr. Chan Wing Yuen, Hubert, Ms. Lin Min, Mindy, Ms. Kwong Wai Man, Karina; and the independent non-executive Directors are Mr. Lui Tin Nang, Ms. Ma Lee and Mr. Lau Kwok Kee. This announcement, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this announcement is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this announcement misleading. This announcement will remain on the GEM website at and, in the case of this announcement, on the Latest Company Announcements page for at least 7 days from the date of its posting. This announcement will also be published on the Company s website at * For identification purpose only 10