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. CIFI Holdings (Group) Co. Ltd. (Incorporated in the Cayman Islands with limited liability) (Stock code: 00884) DISCLOSEABLE TRANSACTION FORMATION OF JOINT VENTURE FOR THE DEVELOPMENT OF A RESIDENTIAL SITE IN SUZHOU, THE PRC On 14 April 2015, the Company, Henderson China, Eastime Investment and HC Jiangsu entered into the Cooperation Agreement for the formation of a joint venture to develop the Site situated at Xushuguan Development Zone, Suzhou National Hi-tech District, Suzhou, the PRC ( ). As at the date of this announcement, Henderson China holds the entire interest in Eastime Investment which in turn holds the entire interest in HC Jiangsu. HC Jiangsu succeeded in the bidding of the land use rights in respect of the Site offered for sale by Suzhou Municipal Bureau of National Land and Resource ( ) on 31 December 2014 and entered into the Land Use Rights Grant Contracts in respect of the Site on 13 February 2015. HC Jiangsu will establish the Project Company in the PRC for the development of the Site. The Project Company will have a registered capital of US$240 million. Pursuant to the terms of the Cooperation Agreement, the Company will (through its wholly owned subsidiary) subscribe for one new share proposed to be issued by Eastime Investment at consideration of US$1. Each of Henderson China and the Company respectively had provided a shareholder s loan of approximately RMB359 million to Eastime Investment, and is committed to provide a further of RMB395 million by way of further shareholder s loan to Eastime Investment which will be used for capital injection into the Project Company. Eastime Investment will then be the Joint Venture vehicle which will be owned as to 50% by the Company and 50% by Henderson China (through vehicles respectively controlled by each of them). The capital commitment made by the Group under the Cooperation Agreement will be financed by internal resources of the Group. 1
As the highest applicable percentage ratio for the transactions under the Cooperation Agreement is above 5% but less than 25%, the investment in the Joint Venture constitutes a discloseable transaction of the Company and is therefore subject to reporting and announcement requirements but exempt from the Shareholders approval requirement under Chapter 14 of the Listing Rules. INFORMATION OF THE COOPERATION AGREEMENT Date 14 April 2015 Parties (i) (ii) The Company; Henderson China; (iii) Eastime Investment; and (iv) HC Jiangsu. Capital contribution and shareholding in the Joint Venture As at the date of this announcement, Henderson China holds the entire interest in Eastime Investment which in turn holds the entire interest in HC Jiangsu. HC Jiangsu succeeded in the bidding of the land use rights in respect of the Site offered for sale by Suzhou Municipal Bureau of National Land and Resource ( ) on 31 December 2014 and entered into the Land Use Rights Grant Contracts in respect of the Site on 13 February 2015. HC Jiangsu will establish the Project Company in the PRC for the development of the Site. The Project Company will have a registered capital of US$240 million. Pursuant to the terms of the Cooperation Agreement, the Company will (through its wholly owned subsidiary) subscribe for one new share proposed to be issued by Eastime Investment at consideration of US$1. Each of Henderson China and the Company respectively had provided a shareholder s loan of approximately RMB359 million to Eastime Investment, and is committed to provide a further of approximately RMB395 million by way of further shareholder s loan to Eastime Investment which will be used for capital injection into the Project Company. Eastime Investment will then be the Joint Venture vehicle which will be owned as to 50% by the Company and 50% by Henderson China (through vehicles respectively controlled by each of them). The capital commitment made by the Group under the Cooperation Agreement will be financed by internal resources of the Group. The amount of capital to be injected into the Project Company is determined by the parties after arm s length negotiation based on the land premium and the development cost of the Site. 2
Composition of the board of directors of the Joint Venture The board of directors of the Joint Venture will comprise 5 directors, 2 of whom will be appointed by the Company and the remaining 3 of whom will be appointed by Henderson China. Profit and loss sharing The Company and Henderson China will be entitled to share the profit or bear the loss of the Joint Venture in proportion to their respective equity interest in the Joint Venture. The Joint Venture is intended to be accounted for as a non-subsidiary of the Group, which will not be consolidated into the financial statements of the Group. INFORMATION OF THE SITE Site location: Total site area: Planned gross floor area: Terms of land use rights: Land premium: The site located at the east side of 312 National Road and the south side of Hongfu Road, Xushuguan Development Zone, Suzhou National Hi-tech District, Suzhou, the PRC ( 312 ) 171,334.4 sq.m 394,069.12 sq.m 70 years for residential use RMB1,400,000,000 INFORMATION OF HENDERSON CHINA, EASTIME INVESTMENT AND HC JIANGSU Henderson China is a company incorporated in Hong Kong and ultimately controlled by Henderson Land. Henderson Land is an investment holding company and its subsidiaries are principally engaged in the businesses of property development and investment, construction, infrastructure, hotel operation, finance, department store operation, project management, investment holding and property management. Eastime Investment is company incorporated in the BVI with limited liability and HC Jiangsu is a company incorporated in Hong Kong with limited liability. Both of Eastime Investment and HC Jiangsu are wholly-owned subsidiaries of Henderson China as at the date of this announcement and principally engaged in investment holding. Taking into account the shareholders loan of approximately HK$891,662,000 due from the Joint Venture to its shareholders, the unaudited consolidated net deficit of the Joint Venture as at the date of this announcement was approximately HK$105,192. As at the date of this announcement, the Joint Venture and HC Jiangsu do not hold any asset other than the Site. 3
To be best of the Directors knowledge, information and belief, having made all reasonable enquiries, Henderson China, Eastime Investment and HC Jiangsu and their respective ultimate beneficial owner(s) are Independent Third Parties of the Company and connected persons of the Company. REASONS FOR AND BENEFIT OF THE COOPERATION AGREEMENT The Group is principally engaged in the property development, property investment and property management businesses in the PRC. It has been the strategy of the Group to cooperate with renowned property developer for development of particular project so as to achieve synergy benefits and diversify its financial exposure. The Directors consider that the Cooperation Agreement has been entered into on normal commercial terms, and the terms and conditions therein are fair and reasonable and in the interests of the Company and the Shareholders as a whole. LISTING RULES IMPLICATION As the highest applicable percentage ratio for the transactions under the Cooperation Agreement is above 5% but less than 25%, the investment in the Joint Venture constitutes a discloseable transaction of the Company and is therefore subject to reporting and announcement requirements but exempt from the Shareholders approval requirement under Chapter 14 of the Listing Rules. DEFINITIONS In this announcement, the following expressions have the following meanings, unless the context requires otherwise: Board BVI Company Cooperation Agreement Directors the board of Directors the British Virgin Islands CIFI Holdings (Group) Co. Ltd. ( ), a company incorporated in the Cayman Islands with limited liability and the shares of which are listed on the Main Board of the Stock Exchange the Cooperation Agreement dated 14 April 2015 entered into among the Company, Henderson China, Eastime Investment and HC Jiangsu in relation to the formation of joint venture and joint development of the Site the directors of the Company 4
Eastime Investment or the Joint Venture Group HC Jiangsu Henderson China Henderson Land HK$ Hong Kong Independent Third Party(ies) Land Use Rights Grant Contract Project Company RMB Shareholders Eastime Investment Limited ( ), a company incorporated in the BVI with limited liability and a wholly owned subsidiary of Henderson China as at the date of this announcement which is intended to be the joint venture vehicle owned by the Company and Henderson China contemplated under the Cooperation Agreement the Company and its subsidiaries HC Jiangsu Development Limited ( ), a company incorporated in Hong Kong with limited liability and wholly owned by Eastime Investment as at the date of this announcement Henderson China Properties Limited ( ), a company incorporated in Hong Kong with limited liabilities and controlled by Henderson Land Henderson Land Development Company Limited ( ), a company incorporated in Hong Kong and the shares of which are listed on the Main Board of the Stock Exchange (Stock Code: 00012) Hong Kong dollar the Hong Kong Special Administrative Region of the PRC an individual(s) or a company(ies) who or which is (are) independent of and not connected with (within the meaning of the Listing Rules) and Directors, chief executive or substantial shareholders, or the Company, its subsidiaries or any of their respective associate(s) Land Use Rights Grant Contact ( ) dated 13 February 2015 entered into between HC Jiangsu and Suzhou Municipal Bureau of National Land and Resource in respect of the Site a project company to be established by HC Jiangsu in the PRC for the development of the Site Renminbi the shareholders of the Company 5
Site sq.m. Stock Exchange US$ a site located at the east side of 312 National Road and the south side of Hongfu Road, Xushuguan Development Zone, Suzhou National Hi-tech District, Suzhou, the PRC ( 312 ) square metre(s) The Stock Exchange of Hong Kong Limited United States Dollar % per cent. By order of the Board CIFI Holdings (Group) Co. Ltd. LIN Zhong Chairman Hong Kong, 15 April 2015 As at the date of this announcement, the Board comprises Mr. LIN Zhong, Mr. LIN Wei and Mr. LIN Feng as executive Directors; and Mr. GU Yunchang, Mr. ZHANG Yongyue and Mr. TAN Wee Seng as independent non-executive Directors. * For identification purposes only 6