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.
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 03382)
DISCLOSEABLE AND CONNECTED TRANSACTION
IN RELATION TO
THE DISPOSAL OF 53% EQUITY INTEREST IN CHIMBUSCO TIANJIN
On 26 February 2021, Tianjin Port Co, a non wholly-owned subsidiary of the Group, entered into the Equity Transfer Agreement with Economic-Technological Co, pursuant to which Tianjin Port Co agreed to transfer, and Economic-Technological Co agreed to acquire 53% of the equity interest in CHIMBUSCO Tianjin at the consideration of RMB14,900,285.28.
Upon completion of the Disposal, the Group will no longer hold any equity interest in CHIMBUSCO Tianjin, and CHIMBUSCO Tianjin will cease to be a subsidiary of the Group.
Economic-Technological Co is a wholly-owned subsidiary of Tianjin Port Group (which is the controlling shareholder of the Company) and is therefore a connected person of the Company. Accordingly, the Disposal constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules.
As the highest percentage ratio (as defined in the Listing Rules) in respect of the Disposal is more than 5% but less than 25%, the Disposal constitutes a discloseable and connected transaction of the Company and is subject to the reporting, announcement, circular (including independent financial advice) and independent shareholders' approval requirements under Chapter 14 and Chapter 14A of the Listing Rules.
An Independent Board Committee has been established to advise the Independent Shareholders on the terms of the Equity Transfer Agreement and the Disposal. An independent financial adviser has been appointed to advise the Independent Board Committee and the Independent Shareholders in this connection.
The EGM will be convened and held for the Independent Shareholders to consider and, if thought fit, to approve, among other things, the Equity Transfer Agreement and the Disposal. As Tianjin Port Group is the controlling shareholder of the Company and is materially interested in the Disposal, Tianjin Port Group and its associates will abstain from voting in respect of the relevant resolution.
A circular containing, among other things, details of the terms of the Equity Transfer Agreement and the Disposal, the recommendation from the Independent Board Committee to the Independent Shareholders, the advice from the independent financial adviser to the Independent Board Committee and the Independent Shareholders and a notice of the EGM, will be despatched to the Shareholders on or before 19 March 2021.
EQUITY TRANSFER AGREEMENT
Date
: 26 February 2021
Parties
: Tianjin Port Co (as transferor) Economic-Technological Co (as transferee)
Interest to be disposed of
: 53% of the equity interest in CHIMBUSCO Tianjin
Consideration and payment terms
: The consideration is RMB14,900,285.28 which was arrived at after arm's length negotiations between Tianjin Port Co and Economic-Technological Co with reference to the appraised value determined by the independent valuer, China Alliance Appraisal Co., Ltd. (北京中同華資產評估有限公 司). China Alliance Appraisal Co., Ltd. adopted the asset-based approach for the valuation of the market value of the entire shareholders' equity in CHIMBUSCO Tianjin as at the Valuation Reference Date, and the appraised value was RMB28,113,745.81.
The net profit and loss of CHIMBUSCO Tianjin for the Transitional Period shall be enjoyed or borne by Tianjin Port Co in proportion to its shareholding prior to the Disposal. The consideration shall be adjusted by 53% of the net profit and loss of CHIMBUSCO Tianjin for the Transitional Period, provided that the final consideration will not be less than RMB0.
The final consideration shall be paid by Economic-Technological Co to Tianjin Port Co in one lump sum in cash within 60 days after the date of completion of the Disposal.
Effectiveness and conditions precedent
: The Equity Transfer Agreement will become effective upon satisfaction of the following conditions:
(i) the Equity Transfer Agreement having been approved at the general meeting of the Company;
(ii) the declaration of concentration by business operators in relation to the
Equity Transfer Agreement having been completed by Economic-Technological Co and the approval having been obtained; and
(iii) the loans provided to CHIMBUSCO Tianjin by Tianjin Port Co and its subsidiaries and the outstanding interest, and all dividend payable by
CHIMBUSCO Tianjin to Tianjin Port Co having been repaid in full by CHIMBUSCO Tianjin before the date of completion of the Disposal.
Completion
:After the Equity Transfer Agreement having become effective, Tianjin Port Co and Economic-Technological Co shall cooperate and handle the shareholding change registration with the industrial and commercial authorities in respect of the Disposal as soon as practicable in accordance with laws. The date of completion of the Disposal shall be the date of the registration for the shareholding change.
INFORMATION ON CHIMBUSCO TIANJIN
CHIMBUSCO Tianjin is a limited liability company incorporated in the PRC with a registered capital of RMB200 million and is principally engaged in the sale of fuel oil.
As at the date of this announcement, Tianjin Port Co holds 53% of the equity interest in CHIMBUSCO Tianjin. Upon completion of the Disposal, the Group will no longer hold any equity interest in CHIMBUSCO Tianjin, and CHIMBUSCO Tianjin will cease to be a subsidiary of the Group.
According to the audited financial statements of CHIMBUSCO Tianjin prepared under the China Accounting Standards for Business Enterprises, the audited net asset value of CHIMBUSCO Tianjin as at 30 November 2020 was approximately RMB27.64 million and its audited net profit/(loss) before and after tax for the two years ended 31 December 2018 and 2019 and the eleven months ended 30 November 2020 are set out below:
Net profit/(loss) before and after tax |
FINANCIAL EFFECT OF THE DISPOSAL |
For the eleven months | ||
ended 30 November | ||
2020 | 2018 | |
RMB million | RMB million | RMB million |
(audited) | (audited) | (audited) |
(68.86) | 10.51 | 10.41 |
For the year ended 31 December 2019
It is estimated that the Group will record an unaudited loss before tax (after deducting non-controlling interests) from the Disposal of approximately RMB9 million, which is calculated based on the difference between the consideration of the Disposal and the unaudited net asset value of CHIMBUSCO Tianjin attributable to the Group in the consolidated financial statements of the Group as at 30 November 2020 (prepared under the Hong Kong Financial Reporting Standards).
The actual gain or loss of the Group arising from the Disposal is subject to audit, and can only be determined on or after the date of completion of the Disposal. The Group intends to use the proceeds from the Disposal as general working capital of the Group.
REASONS FOR AND BENEFITS OF THE DISPOSAL
CHIMBUSCO Tianjin is principally engaged in the sale of fuel oil, which is part of the sales business of the Group. The Disposal will enable the Group to further focus on its core business and allocate its resources on cargo handling business, which generates a higher return. Taking into account that CHIMBUSCO Tianjin has a higher gearing ratio than that of the Group and its gross profit margin is relatively low, with fluctuating operating results from time to time during the past few years and even recorded a net loss for the eleven months ended 30 November 2020, the Company considers that the Disposal would be conducive to improve the operating results of the Group as a whole. The Company believes that the Disposal will also reduce operational risks and capital risks of the Group, optimise the Group's debt structure and improve the Group's overall asset quality to lay the foundation for the Group's continuous and stable development.
The Directors (excluding members of the Independent Board Committee who will express their opinion after considering the recommendation of the independent financial adviser) are of the view that the Disposal is conducted on normal commercial terms, and the terms of the Equity Transfer Agreement and the Disposal are fair and reasonable and in the interests of the Company and the Shareholders as a whole.
None of the Directors had a material interest in the Disposal. In view of good corporate governance practices, Chu Bin, Luo Xunjie and Xue Xiaoli, the Directors, abstain from voting in respect of the Board resolutions in relation to the transactions with Tianjin Port Group and/or its associates.
INFORMATION ON THE PARTIES
The Group is principally engaged in containerised and non-containerised cargo handling services, sales and other port ancillary services at the port of Tianjin in the PRC, primarily through its subsidiaries and associated companies.
Tianjin Port Group is the controlling shareholder of the Company. Its principal business includes port handling and stevedoring services, warehousing, logistics, and port area land development at the port of Tianjin in the PRC through its group companies.
Tianjin Port Co is principally engaged in containerised and non-containerised cargo handling services, sales and other port ancillary services at the port of Tianjin in the PRC, primarily through its subsidiaries and associated companies.
Economic-Technological Co is principally engaged in investment holding.
LISTING RULES IMPLICATIONS
Economic-Technological Co is a wholly-owned subsidiary of Tianjin Port Group (which is the controlling shareholder of the Company) and is therefore a connected person of the Company. Accordingly, the Disposal constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules.
As the highest percentage ratio (as defined in the Listing Rules) in respect of the Disposal is more than 5% but less than 25%, the Disposal constitutes a discloseable and connected transaction of the Company and is subject to the reporting, announcement, circular (including independent financial advice) and independent shareholders' approval requirements under Chapter 14 and Chapter 14A of the Listing Rules.
An Independent Board Committee has been established to advise the Independent Shareholders on the terms of the Equity Transfer Agreement and the Disposal. An independent financial adviser has been appointed to advise the Independent Board Committee and the Independent Shareholders in this connection.
The EGM will be convened and held for the Independent Shareholders to consider and, if thought fit, to approve, among other things, the Equity Transfer Agreement and the Disposal. As Tianjin Port Group is the controlling shareholder of the Company and is materially interested in the Disposal, Tianjin Port Group and its associates will abstain from voting in respect of the relevant resolution.
A circular containing, among other things, details of the terms of the Equity Transfer Agreement and the Disposal, the recommendation from the Independent Board Committee to the Independent Shareholders, the advice from the independent financial adviser to the Independent Board Committee and the Independent Shareholders and a notice of the EGM, will be despatched to the Shareholders on or before 19 March 2021.
DEFINITIONS
In this announcement, unless the context requires otherwise, the following terms shall have the following meanings:
"associate(s)" | has the meaning ascribed to it under the Listing Rules; |
"Board" | the board of Directors; |
"CHIMBUSCO Tianjin" | 天津中燃船舶燃料有限公司 (CHIMBUSCO Marine |
Bunker (Tianjin) Co., Ltd.*), a limited liability company | |
incorporated in the PRC and a non wholly-owned subsidiary | |
of the Group as at the date of this announcement; | |
"Company" | Tianjin Port Development Holdings Limited, 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 (Stock Code: 03382); | |
"connected person(s)" | has the meaning ascribed to it under the Listing Rules; |
"controlling shareholder" | has the meaning ascribed to it under the Listing Rules; |
"Director(s)" | the director(s) of the Company; |
5 |
"Disposal" | the disposal of 53% of the equity interest in CHIMBUSCO |
Tianjin by Tianjin Port Co to Economic-Technological Co | |
pursuant to the Equity Transfer Agreement; | |
"Economic-Technological Co" | 天津港經濟技術合作有限公司 (Tianjin Port Economic- |
Technological Cooperation Co., Ltd.*), a limited liability | |
company incorporated in the PRC and a wholly-owned | |
subsidiary of Tianjin Port Group; | |
"EGM" | the extraordinary general meeting of the Company to be |
convened and held to consider and, if thought fit, to approve, | |
inter alia, the Equity Transfer Agreement and the Disposal; | |
"Equity Transfer Agreement" | the agreement dated 26 February 2021 entered into between |
Tianjin Port Co (as transferor) and Economic-Technological | |
Co (as transferee) in relation to the Disposal, details of which | |
are set out in the section headed "Equity Transfer | |
Agreement" in this announcement; | |
"Group" | the Company and its subsidiaries; |
"Hong Kong" | the Hong Kong Special Administrative Region of the PRC; |
"Independent Board Committee" | the independent board committee comprising all of the |
independent non-executive Directors; | |
"Independent Shareholders" | Shareholders, other than Tianjin Port Group and its |
associates; | |
"Listing Rules" | the Rules Governing the Listing of Securities on the Stock |
Exchange; | |
"PRC" | the People's Republic of China; |
"RMB" | Renminbi, the lawful currency of the PRC; |
"Shareholder(s)" | the shareholder(s) of the Company; |
"Stock Exchange" | The Stock Exchange of Hong Kong Limited; |
"Tianjin Port Co" | 天津港股份有限公司 (Tianjin Port Holdings Co., Ltd.*), a |
limited liability company incorporated in the PRC and the | |
shares of which are listed on the Shanghai Stock Exchange | |
(Stock Code: 600717). As at the date of this announcement, | |
approximately 56.81% of its equity interest is indirectly held | |
by the Company; | |
6 |
"Tianjin Port Group"
天津港（集團）有限公司 (Tianjin Port (Group) Co., Ltd.*), an entity reorganised as a wholly state-owned company in the PRC on 29 July 2004 and holding the business owned and operated by the former government regulatory body of the port of Tianjin; and the indirect holder of 53.5% of the issued share capital of the Company as at the date of this announcement;
"Transitional Period"
the period from the day following the Valuation Reference Date (inclusive of that date) to the last day of the month of the completion date of the Disposal;
"Valuation Reference Date"
30 November 2020, being the reference date for the valuation of the market value of the entire shareholders' equity in CHIMBUSCO Tianjin; and
"%"
per cent.
By Order of the Board
Tianjin Port Development Holdings Limited
Chu Bin
Chairman
Hong Kong, 26 February 2021
As at the date of this announcement, the Board comprises Mr. Chu Bin, Mr. Luo Xunjie, Mr. Sun Bin, Ms. Xue Xiaoli and Ms. Shi Jing as executive Directors; Professor Japhet Sebastian Law, Mr. Cheng Chi Pang, Leslie and Mr. Zhang Weidong as independent non-executive Directors.
*For identification purposes only