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BOER POWER HOLDINGS LIMITED博耳電力控股有限公司
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 1685) VOLUNTARY ANNOUNCEMENT- STRATEGIC COOPERATION AGREEMENT WITH SHANGHAI GALAXY
- POTENTIAL DISPOSAL OF 80.1% EQUITY INTEREST IN GANNAN LONGYANG
This announcement is made by Boer Power Holdings Limited (the "Company", and together with its subsidiaries, the "Group") on a voluntary basis for the purpose of keeping the shareholders of the Company (the "Shareholders") and potential investors informed of the latest business development of the Group.
THE STRATEGIC COOPERATION AGREEMENT WITH SHANGHAI GALAXYThe board (the "Board") of directors (the "Directors") of the Company wishes to announce that the Company has recently entered into a strategic cooperation agreement (the "Strategic Cooperation Agreement") with Shanghai Galaxy Investment Co, Ltd* (上海星河數碼投 資有限公司 "Shanghai Galaxy") in relation to the development, investment, construction, operation and maintenance of the photovoltaic power stations and rooftop distributed power stations project in the People's Republic of China (the "PRC").
To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, Shanghai Galaxy and its ultimate beneficial owners are third parties independent of the Company and connected persons of the Company.
Pursuant to the Strategic Cooperation Agreement, the Company has agreed to engage in the development and construction of the photovoltaic power stations and to develop certain photovoltaic power stations resources. Shanghai Galaxy will acquire the photovoltaic power stations upon establishment and appoint the Company or its designated party for the operation and maintenance of all the acquired photovoltaic power stations. It is estimated that the total installed capacity of the photovoltaic power stations and rooftop distributed power stations would be 100MW.
* For identification purposes only
Shanghai Galaxy intends to acquire most of the photovoltaic power station assets currently held by the Company at total estimated transaction amount of approximately RMB200 million to RMB300 million (equivalent to approximately HK$229.9 million to HK$344.8 million). The final consideration and terms of the acquisition(s) are subject to the entering into of definitive agreement(s). As of the date hereof, Shanghai Galaxy has entered into a conditional equity transfer agreement with the Group as one of its intended acquisitions as mentioned above, more details of which are disclosed below.
The Strategic Cooperation Agreement shall remain in effect for an initial term of three years (unless earlier terminated) from the date of the Strategic Cooperation Agreement. The Strategic Cooperation Agreement shall automatically extend for one year upon expiry of the initial term.
The Board expects that the entering into of the Strategic Cooperation Agreement will facilitate cooperation between the Group and Shanghai Galaxy. As at the date hereof, Shanghai Galaxy is a 50% owned joint venture of SIIC Shanghai Holdings Co., Ltd* (上海上 實（集團）有限公 司), a company incorporated in the PRC with limited liability with Shanghai Industrial Investments (Holdings) Limited * ( 上 海 實 業（集 團 ）有 限 公 司 ), the largest overseas conglomerate enterprise under the Shanghai municipal government as the authorised representative exercising the state-owned shareholder's right over it. Shanghai Industrial Investment (Holdings) Company Limited* ( 上海實 業（集 團）有限公司 ) is the controlling shareholders of Shanghai Industrial Holdings Limited, a company listed in Hong Kong (Stock Code: 363). The Board is of the view that the Company has the appropriate electric power assets to satisfy Shanghai Galaxy, which intends to expand its electric power assets. As such, the Board considers that the entering into of the Strategic Cooperation Agreement represents an opportunity for the Group to further expand its business and to increase its cash flow.
Shareholders and investors should note that the transaction(s) contemplated under the Strategic Cooperation Agreement are subject to further negotiation of the parties and the entering into of definitive agreement(s) and therefore the transaction(s) thereunder may or may not materialise. As the Strategic Cooperation Agreement may or may not bring the expected benefits to the Group, Shareholders and investors are advised to exercise caution when dealing in the shares of the Company. POTENTIAL DISPOSAL OF 80.1% EQUITY INTEREST IN GANNAN LONGYANGThe Board wishes to further announce that in furtherance of the Strategic Cooperation Agreement, Boer Energy Jiangsu Co., Ltd.* (博耳能源江蘇有限公司, "Boer Energy"), a non-wholly owned subsidiary of the Company, entered into an equity transfer agreement (the "Equity Transfer Agreement") with Shanghai Galaxy, pursuant to which Boer Energy has conditionally agreed to sell, and Shanghai Galaxy has conditionally agreed to purchase 80.1% equity interest in Gannan Longyang New Energy Co., Ltd.* (甘南縣龍暘新能源有限公司, "Gannan Longyang"), a wholly-owned subsidiary of Boer Energy, at the consideration of RMB41,652,000 (equivalent to approximately HK$47,875,862) (the "Disposal"). The Disposal is one of the acquisitions as intended by Shanghai Galaxy under the Strategic Cooperation Agreement.
Completion of the Disposal is conditional upon satisfaction (or waiver) of a number of conditions precedent as set out in the Equity Transfer Agreement, including but not limited to, release of the pledge created over the 80.1% equity interest in Gannan Longyang.
After completion of the Disposal, Gannan Longyang will cease to be a subsidiary of the Boer Energy and its accounts will not be consolidated into that of Boer Energy.
As the relevant percentage ratios are less than 5%, the Disposal does not a notifiable transaction of the Company under Chapter 14 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.
Shareholders and investors should note that completion of the Disposal is subject to the satisfaction (or waiver) of the conditions precedent set out in the Equity Transfer Agreement and therefore the Disposal may or may not proceed to completion. Shareholders and investors are advised to exercise caution when dealing in the shares of the Company. INFORMATION OF THE GROUP AND SHANGHAI GALAXYThe Group is principally engaged in the design, manufacture and sale of electrical distribution equipment and provision of electrical distribution systems solution services in the PRC.
Shanghai Galaxy is a sino-foreign joint venture incorporated in the PRC with limited liability. It is principally engaged in business investment, asset management and other consultation businesses.
On behalf of the Board
Boer Power Holdings Limited Qian YixiangChairman
Hong Kong, 4 November 2016
As at the date hereof, the Board comprises (i) four executive Directors: Mr. Qian Yixiang, Ms. Jia Lingxia, Mr. Zha Saibin and Mr. Qian Zhongming; (ii) one non-executive Director: Mr. Zhang Huaqiao; and (iii) three independent non-executive Directors: Mr. Yeung Chi Tat, Mr. Tang Jianrong and Mr. Qu Weimin.
In this announcement, for the purposes of illustration, amounts denominated in RMB have been converted into HK$ at the rate of HK$1 = RMB0.87. No representation is made that any amounts in RMB or HK$ have been, could have been or could be converted at the above rate or at any other rates or at all.