BBMG : DISCLOSEABLE TRANSACTION - DISPOSAL OF 49% EQUITY INTERESTS IN BEIJING BBMG MANGROVE

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.

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 2009)

DISCLOSEABLE TRANSACTION

DISPOSAL OF 49% EQUITY INTERESTS IN BEIJING BBMG MANGROVE

DISPOSAL OF 49% EQUITY INTERESTS IN BEIJING BBMG MANGROVE

The Board is pleased to announce that on 8 October 2019, after trading hours, the Company entered into the Sale and Purchase Agreement with Jidong Cement, pursuant to which, the Company has agreed to transfer its 49% equity interests held in Beijing BBMG Mangrove to Jidong Cement at a total consideration of RMB1,721,464,500. Jidong Cement will settle the consideration by way of cash to the Company.

Upon Completion, the Company will cease to have any direct equity interests in Beijing BBMG Mangrove and Beijing BBMG Mangrove will become an indirect non wholly-owned subsidiary of the Company.

LISTING RULES IMPLICATIONS

As one of the applicable percentage ratios calculated under Rule 14.07 of the Listing Rules in respect of Sale and Purchase Agreement is more than 5% but less than 25%, the entering into of the Sale and Purchase Agreement will constitute a discloseable transaction of the Company which is subject to the reporting and announcement requirements only under Chapter 14 of the Listing Rules.

* English translation denotes for identification purposes only

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BACKGROUND

The Board is pleased to announce that on 8 October 2019, after trading hours, the Company entered into the Sale and Purchase Agreement with Jidong Cement, pursuant to which, the Company has agreed to transfer its 49% equity interests held in Beijing BBMG Mangrove to Jidong Cement at a total consideration of RMB1,721,464,500. Jidong Cement will settle the consideration by way of cash to the Company. Set out below are the principal terms of the Sale and Purchase Agreement.

SALE AND PURCHASE AGREEMENT

Date:	8 October 2019 (after trading hours)
Parties:	(i) The Company as vendor; and
	(ii) Jidong Cement as purchaser
Subject Matter:	Pursuant to the Sale and Purchase Agreement, the Company has
	agreed to transfer its 49% equity interests held in Beijing BBMG
	Mangrove to Jidong Cement.
Consideration:	The total consideration is RMB1,721,464,500. Jidong Cement will
	settle the consideration by way of cash to the Company. Jidong
	Cement shall pay the consideration to the Company within 15
	business days upon the Sale and Purchase Agreement being
	effective.
	The total value of the equity interests of Beijing BBMG Mangrove
	was valued at RMB3,513,192,800 based on the valuation result as
	determined by an independent valuer using 31 May 2019 as the
	valuation date. Accordingly, the total consideration of
	RMB1,721,464,500 represents 49% of the valuation rendered.
Completion:	Within 15 business days after the payment of the consideration by
	Jidong Cement to the Company and the receipt of a certificate from
	the Beijing Equity Exchange, the Company and Jidong Cement will
	assist Beijing BBMG Mangrove in the transfer of the 49% equity
	interests. Upon the registration of the transfer of the 49% equity
	interests, being the completion date, all the benefits, risks and
	responsibilities in relation to the 49% equity interests will be
	transferred to Jidong Cement.

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Financial Effect of The	As a result of the Disposal, the Group is expected to record an
Disposal	unaudited gain of approximately RMB471,763,600 comprising (i)
	49% of the valuation of RMB3,513,192,800 being
	RMB1,721,464,500, less (ii) relevant expenses of approximately
	RMB215,600, and less (iii) 49% of the audited net assets of Beijing
	BBMG Mangrove as at 31 May 2019 of RMB2,549,970,000, being
	RMB1,249,485,300.
	Upon Completion, the Company will cease to have any direct
	equity interests in Beijing BBMG Mangrove and Beijing BBMG
	Mangrove will become an indirect non wholly-owned subsidiary of
	the Company.
Use of Proceeds From The	The Company intends to apply the proceeds from the Disposal for
Disposal	general working capital of the Company.

INFORMATION ON PARTIES TO THE SALE AND PURCHASE AGREEMENT

Information on the Company

The Company is a joint stock company established under the laws of the PRC with limited liability, the A shares of which are listed on the Shanghai Stock Exchange and the H shares of which are listed on the Main Board of the Stock Exchange. The Company is principally engaged in the manufacture and sale of cement and modern building materials, property development, property investment, and provision of property management services.

Information on Jidong Cement

Jidong Cement is a joint stock company established under the laws of the PRC with limited liability, the A shares of which are listed on the Shenzhen Stock Exchange (stock code: 000401). As at the date of this announcement, Jidong Cement is held by the Company and Jidong Development as to 7.0% and 30.0% respectively. Jidong Cement is a non-wholly owned subsidiary of Jidong Development. Its financial statements are consolidated into the financial statements of Jidong Development. Jidong Development is in turn held by the Company as to 55.0%, and is a non-wholly owned subsidiary of the Company. The principal businesses of Jidong Cement are the manufacturing and sale of cement, clinker and concrete.

Information of Beijing BBMG Mangrove

Beijing BBMG Mangrove is a company established in the PRC with limited liability and its equity interests are owned as to 49% and 51% by the Company and the JV Company respectively as at the date of this announcement and is therefore a non-wholly owned subsidiary of the Company. Beijing BBMG Mangrove is principally engaged in the collection, storage and processing of poisonous and hazardous wastes.

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Set out below is the key financial information of Beijing BBMG Mangrove based on the audited financial statements prepared in accordance with the China Accounting Standards for Business Enterprises for the two years ended 31 December 2018:

	For the year ended	For the year ended
	31 December 2017	31 December 2018
	(RMB'000)	(RMB'000)
Profit before tax	82,386.22	189,821.99
Profit after tax	63,919.43	135,896.77

REASONS AND BENEFITS OF THE SALE AND PURCHASE AGREEMENT

The Sale and Purchase Agreement will be beneficial to the Company in terms of further refining its internal organization structure and will provide an opportunity for the Company to continue to cooperate with Jidong Cement through the JV Company on various aspects and will be a win-win situation to both the Company and Jidong Cement. The transactions under the Sale and Purchase Agreement is not expected to have any material adverse effect on the Company's operating results.

The consideration was determined based on arm's length negotiations between the parties and based on the valuation results of the equity interests of Beijing BBMG Mangrove as at 31 May 2019 rendered by an independent valuer. The Board considers that the terms of the Sale and Purchase Agreement are fair and reasonable and are in the interests of the Shareholders as whole.

LISTING RULES IMPLICATIONS

As one of the applicable percentage ratios calculated under Rule 14.07 of the Listing Rules in respect of Sale and Purchase Agreement is more than 5% but less than 25%, the entering into of the Sale and Purchase Agreement will constitute a discloseable transaction of the Company which is subject to the reporting and announcement requirements only under Chapter 14 of the Listing Rules.

DEFINITIONS

Unless the context requires otherwise, capitalized terms used in this announcement shall have the meanings as follows:

"Beijing BBMG Mangrove" Beijing BBMG Mangrove* (北京金隅紅樹林環保技術有限責任公 司), a company established in the PRC with limited liability in which its equity interests are owned as to 49% and 51% by the Company and the JV Company respectively;

"Board"

the board of directors of the Company;

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"Company"	BBMG Corporation* (北京金隅集團股份有限公司), a joint stock
	company established under the laws of the PRC with limited
	liability, the H shares of which are listed on the Main Board of the
	Stock Exchange (Stock Code: 02009) and the A shares of which are
	listed on the Shanghai Stock Exchange (Stock Code: 601992);
"Completion"	completion of the sale and purchase of the equity interests of
	Beijing BBMG Mangrove under the Sale and Purchase Agreement;
"Disposal"	the sale of the 49% equity interests held by the Company in Beijing
	BBMG Mongrove to Jidong Cement under the Sale and Purchase
	Agreement;
"Jidong Cement"	Tangshan Jidong Cement Co., Ltd.* (唐山冀東水泥股份有限公司),
	a joint stock company established under the laws of the PRC with
	limited liability and the shares of which are listed on the Shenzhen
	Stock Exchange (Stock Code: 000401);
"Jidong Development"	Jidong Development Group Co., Ltd.* (冀東發展集團有限責任公
	司), a company established under the laws of the PRC with limited
	liability and owned as to 55% by the Company;
"JV Company"	BBMG Jidong Cement (Tangshan) Company Limited* (金隅冀東
	水泥（唐山）有限責任公司), a joint venture company established
	under the laws of the PRC owned as to 47.09% and 52.91% by the
	Company and Jidong Cement;
"Listing Rules"	the Rules Governing the Listing of Securities on The Stock
	Exchange of Hong Kong Limited;
"PRC"	the People's Republic of China;
"RMB"	Renminbi, the lawful currency of the PRC;
"Sale and Purchase	the sale and purchase agreement dated 8 October 2019 entered into
Agreement"	between the Company with Jidong Cement for the sale and
	purchase of 49% equity interests of Beijing BBMG Mangrove;
"Shareholders"	shareholders of the Company;
"Stock Exchange"	The Stock Exchange of Hong Kong Limited;

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"%"

per cent.

By order of the Board

BBMG Corporation*

Jiang Deyi

Chairman

Beijing, the PRC, 8 October 2019

As at the date of this announcement, the executive Directors of the Company are Mr. Jiang Deyi, Mr. Wu Dong and Mr. Zheng Baojin; the non-executive Directors of the Company are Mr. Guo Yanming and Mr. Xue Chunlei; and the independent non-executive Directors of the Company are Mr. Wang Guangjin, Mr. Tian Lihui, Mr. Tang Jun and Mr. Ngai Wai Fung.

* English translation denotes for identification purposes only

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