China Resources Beer : CONTINUING CONNECTED TRANSACTIONS - FRAMEWORK LOAN AGREEMENTS 2019

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 Hong Kong with limited liability)

(Stock code: 291)

CONTINUING CONNECTED TRANSACTIONS

FRAMEWORK LOAN AGREEMENTS 2019

Reference is made to the announcements of the Company dated 20 December 2013 and 22 December 2016 in relation to, among other things, the entering of the Framework Loan Agreements 2013 and Framework Loan Agreements 2016. As the Framework Loan Agreements 2016 will expire on 31 December 2019, the Company has entered into new lending arrangements whereby the annual caps are renewed taking into account the Company's operational scale and cash levels.

As applicable size test percentage ratios exceed 0.1% but are less than 5% in respect of the continuing connected transactions under the Framework Loan Agreements 2019, the transactions are only subject to the reporting, annual review and announcement requirements but are exempted from the independent shareholders' approval requirement of the Listing Rules.

BACKGROUND

Reference is made to the announcement of the Company dated 20 December 2013 and 22 December 2016 in relation to, among other things, the entering of the Framework Loan Agreements 2013 and Framework Loan Agreements 2016. As the Framework Loan Agreements 2016 will expire on 31 December 2019, the Company has entered into new lending arrangements whereby the annual caps are renewed taking into account of the Company's operational scale and cash levels.

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THE FRAMEWORK LOAN AGREEMENTS 2019

Offshore Framework Loan Agreement 2019

Parties:	CRH and the Company
Date of agreement:	17 December 2019
Date of commencement of	1 January 2020
agreement:
Term of the agreement:	Three years ending 31 December 2022, unless extended for
	a further period
Lenders:	The Company and any of its subsidiaries which has become
	a party to the Offshore Framework Loan Agreement 2019 by
	acceding to its terms, but excluding any entity which is
	established in the PRC
Borrowers:	CRH, any China Resources Group listed company and any
	of their subsidiaries, which has become a party to the
	Offshore Framework Loan Agreement 2019 by acceding to
	its terms, but excluding any entity which is established in
	the PRC and any member of the Group. Each borrower may
	borrow in Hong Kong dollars, RMB or United States dollars
Guarantor(s) for loans made	CRH (except where the borrower is CRH) and, in the case
by the Group:	of an advance to a subsidiary of a China Resources Group
	listed company, that China Resources Group listed company
Aggregate amounts to be	The maximum aggregate amount outstanding lent by the
advanced:	Group under the Framework Loan Agreements 2019 is not
	permitted to exceed the amounts set out under the section
	below headed ''Annual lending caps under the Framework
	Loan Agreements 2019''
Repayment date:	The repayment date for an advance made under the Offshore
	Framework Loan Agreement 2019 shall be no later than six
	months after the date of advance

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Interest rate in respect of Hong Kong dollar advances:

Interest rate in respect of United States dollar advances:

Interest rate in respect of RMB advances:

Guarantee:

The rate per annum as determined by the relevant lender and the borrower as being the aggregate of (i) the relevant HIBOR for such a Hong Kong dollar advance; and (ii) a margin (which must not be a negative number). The interest rate shall not be less than the higher of (i) the rate at which CRH or a corporate borrower of similar standing is able to borrow in Hong Kong dollars in an amount equal to the relevant advance from a bank or a financial institution for the relevant period and (ii) the deposit rate which the lender could have obtained from a bank or a financial institution for such relevant amount and period

The rate per annum as determined by the relevant lender and the borrower as being the aggregate of (i) the relevant LIBOR for such a United States dollar advance; and (ii) a margin (which must not be a negative number). The interest rate shall not be less than the higher of (i) the rate at which CRH or a corporate borrower of similar standing is able to borrow in United States dollars in an amount equal to the relevant advance from a bank or a financial institution for the relevant period and (ii) the deposit rate which the lender could have obtained from a bank or a financial institution for such relevant amount and period

The rate per annum as determined by the relevant lender and the borrower with respect to an advance (which must not be a negative number). The interest rate shall not be less than the higher of (i) the rate at which CRH or a corporate borrower of similar standing is able to borrow in RMB in Hong Kong in an amount equal to the relevant advance from a bank or a financial institution for the relevant period and

1. the deposit rate in Hong Kong which the lender could have obtained from a bank or a financial institution for such relevant amount and period

The guarantors will unconditionally and irrevocably guarantee to the relevant lender the due and punctual performance by the borrower (when the guarantor is CRH) or by the borrower which is the guarantor's subsidiary (when the guarantor is a China Resources Group listed company) of the borrower's obligations to that lender in connection with that lender's advance(s) to the borrower made under the Offshore Framework Loan Agreement 2019. For this purpose, each guarantor which is a China Resources Group listed company will enter into a deed of guarantee before its subsidiary is permitted to borrow under the Offshore Framework Loan Agreement 2019

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Early repayment:	Both a lender and a borrower may by giving ten business
	days' written notice require the repayment or prepayment of
	the advance, as the case may be, together with accrued
	interest
Basis of lending:	All advances will be made at the sole discretion of the
	lender. No security over the assets of the borrower will be
	provided. All advances will become immediately repayable
	on demand upon the occurrence of an acceleration event
	which includes non-payment by the borrower; breaches of
	the agreement by the borrower which have not been
	rectified in the specified period; cross-default in a material
	amount; the enforcement of security; insolvency;
	dissolution; repudiation; CRH ceasing directly or indirectly
	to be the single largest shareholder of the relevant borrower;
	or on the occurrence of a material adverse change as stated
	in the Offshore Framework Loan Agreement 2019 in respect
	of the relevant borrower
Onshore Framework Loan Agreement 2019
Parties:	CRC and the Company
Date of agreement:	17 December 2019
Date of commencement of	1 January 2020
agreement:
Term of agreement:	Three years ending 31 December 2022, unless extended for
	a further period
Lenders:	Any PRC established subsidiary of the Company, which has
	become a party to the Onshore Framework Loan Agreement
	2019 by acceding to its terms
Borrowers:	CRC, and any PRC established subsidiary of CRC or a
	China Resources Group listed company, which has become
	a party to the Onshore Framework Loan Agreement 2019 by
	acceding to its terms, but excluding CR Bank, CR Trust and
	any member of the Group. Each borrower may borrow in
	RMB
Guarantor:	CRC (except where the borrower is CRC)
Aggregate amounts to be	The maximum aggregate amount outstanding lent by the
advanced:	Group under both of the Framework Loan Agreements 2019
	is not permitted to exceed the amounts set out under the
	section below headed ''Annual lending caps under the
	Framework Loan Agreements 2019''

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Repayment date:	The repayment date for an advance made under the Onshore
	Framework Loan Agreement 2019 shall be no later than six
	months after the date of advance
Interest rate:	The rate per annum as determined by the relevant lender and
	the borrower. The interest rate shall be no less than the
	higher of (i) the rate at which CRC or a corporate borrower
	of similar standing is able to borrow in RMB in an amount
	equal to the relevant advance from a bank or a financial
	institution for the relevant period and (ii) the deposit rate
	which the lender could have obtained from a bank or a
	financial institution for such relevant amount and period
Guarantee:	CRC unconditionally and irrevocably guarantees to the
	relevant lenders the due and punctual performance of all
	borrowers' obligations under the Onshore Framework Loan
	Agreement 2019
Best endeavours:	If an advance is to be made pursuant to the Onshore
	Framework Loan Agreement 2019 to a borrower which is a
	subsidiary of a China Resources Group listed company,
	prior to making that advance, such China Resources Group
	listed company shall sign a deed of undertaking and
	undertake that if CRC makes a payment to a lender in
	connection with the Onshore Framework Loan Agreement
	2019 due to a breach by the China Resources Group listed
	company's subsidiary borrower, then the China Resources
	Group listed company will use its best endeavours to
	procure that borrower shall have sufficient funds to, and
	does, promptly reimburse CRC. This may include such
	China Resources Group listed company making payments by
	way of gift or capital contribution or shareholder loan to the
	borrower (to the extent permitted by PRC law)
Early repayment:	Both a lender and a borrower may by giving ten business
	days' written notice require the repayment or prepayment of
	the advance, as the case may be, together with accrued
	interest

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Basis of lending:	All advances will be made at the sole discretion of the
	lender. No security over the assets of the borrower will be
	provided. All advances will become immediately repayable
	on demand upon the occurrence of an acceleration event
	which includes non-payment by the borrower; breaches of
	the agreement by the borrower which have not been
	rectified in the specified period; cross-default in a material
	amount; the enforcement of security; insolvency;
	dissolution; repudiation; CRC ceasing directly or indirectly
	to be the single largest shareholder of the relevant borrower;
	or on the occurrence of a material adverse change as stated
	in the Onshore Framework Loan Agreement 2019 in respect
	of the relevant borrower

Annual lending caps under the Framework Loan Agreements 2019

The annual lending caps for the maximum aggregate amount which can be lent by the Group on any single day (inclusive of interest received and anticipated to be received rounded to the nearest million) under the Framework Loan Agreements 2019 have been determined after assessing the maximum amount of exposure at any time which the Group is prepared to assume under the Framework Loan Agreements 2019 in the context of its estimated temporarily surplus cash resources.

Set out below are the maximum aggregate amounts outstanding on any single day lent by the Group under the Framework Loan Agreements 2016 (inclusive of interest received and receivable) during each of the years ended 31 December 2017 and 2018 and for the ten months ended 31 October 2019:

			For the
			ten months
	For the year	ended
	ended 31 December	31 October
	2017	2018	2019
	RMB million	RMB million	RMB million
Maximum daily aggregate amount
outstanding during the year/period	300	0	1,400

The proposed annual lending caps for the Group on any single day for the term of the Framework Loan Agreements 2019 are as follows:

	For the year ended 31 December
	2020	2021	2022
	RMB million	RMB million	RMB million
Maximum daily aggregate amount
outstanding during the year	2,100	2,100	2,100

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Such maximum daily amount is applicable for each day during the relevant year, and such maximum daily amount is calculated on an individual basis as outstanding at the end of each day during the relevant year without aggregating with the daily amount incurred on the days before. The aforementioned proposed annual lending caps are determined based on arm's length negotiations between the Company, CRH and CRC, having considered, among others, the following factors and assumptions: (i) the historical transaction amounts under the Framework Loan Agreements 2016 as reference; (ii) the expected increase in positive cashflow generated from operations of the Group in the next few years; and (iii) in order to enhance the yield on the surplus cash of the Group, the normal practice of the Group is to invest in short-term, principal protected investment products from banks in the PRC. However, due to the changing market circumstances, the yield for the said products is demonstrating a downward trend, therefore in order to maintain or further enhance the yield of the Group's surplus cash, it is reasonable to consider other low-risk, principal protected investment products in substitution. On such basis, the loans to be made under the Framework Loan Agreements 2019 are substitutes for principal protected investments with manageable risk level that are fully-guaranteed by the controlling shareholders of the Group, and enable the Group to create and enhance the returns by utilizing its surplus cash.

Financial condition of the guarantors

All advances to any member of the China Resources Group will be guaranteed by (i) CRC;

1. CRH; or (iii) CRH and a China Resources Group listed company, depending on the relevant Framework Loan Agreement 2019 and the identity of the borrower. Both CRC and CRH are regarded as borrowers of undoubted standing in their own markets. CRC is a bond issuer in the PRC and its principal long term credit rating is AAA according to an independent rating agency, China Lianhe Credit Rating Co., Ltd. The summary of the consolidated financial positions of CRC and CRH are as follows:

	CRH		CRC
	2018	2017	2018	2017
	Audited	Audited	Audited	Audited
	HK$ billion	HK$ billion	RMB billion	RMB billion
Total assets	1,523	1,330	1,458	1,234
Cash and bank balances	161	138	157	132
Equity attributable to the
shareholders of the company	292	275	215	200
Profit attributable to the
shareholders of the company	34	21	23	22
Cash flow from operation	94	62	69	40

LISTING RULES IMPLICATIONS

By virtue of CRC being the controlling shareholder of CRH, which in turn holds a controlling interest in the Company, CRC and CRH are connected persons to the Company as defined under the Listing Rules.

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As the applicable size test percentage ratios exceed 0.1% but are less than 5% in respect of the continuing connected transactions under the Framework Loan Agreements 2019, the transactions are only subject to the reporting, annual review and announcement requirements but are exempted from the independent shareholders' approval requirement of the Listing Rules.

None of the directors of the Company has any material interest in the transactions under the Framework Loan Agreements 2019, and none of them abstained from voting on the relevant board resolutions approving the Framework Loan Agreements 2019 and the transactions contemplated thereunder.

REASONS FOR AND BENEFITS OF THE PROPOSALS

The Framework Loan Agreements 2019 provide the Company with greater flexibility in the management of its surplus cash resources by enabling it to lend a portion of its surplus cash resources and those of its subsidiaries to other China Resources Group companies, including CRC and CRH. The annual lending caps for the maximum aggregate amount which can be lent by the Group on any single day have been determined after assessing the maximum amount of exposure at any time which the Group is prepared to assume under the Framework Loan Agreements 2019 in the context of its estimated temporary surplus cash resources as well as the historical amount lent by the Group as set out in this announcement.

All directors of the Company (including independent non-executive directors of the Company) consider the Framework Loan Agreements 2019 were negotiated on an arm's length basis and are on normal commercial terms, and the relevant terms and annual caps are fair and reasonable and in the interests of the Company and its shareholders as a whole.

INFORMATION OF CRC, CRH AND THE COMPANY

CRC

CRC, a borrower and guarantor (except for when the borrower is CRC) under the Onshore Framework Loan Agreement 2019, is the holding company of CRH.

CRH

CRH, a borrower and guarantor (except for when the borrower is CRH) under the Offshore Framework Loan Agreement 2019, is a conglomerate in Hong Kong and the PRC that owns 7 major strategic business units and 19 first-tier profit centers, with a coverage of five principal business sectors of Consumer Products, Healthcare, Urban Construction and Operation, Energy Services and Technology & Finance.

The Company

The Company is listed on the Main Board of the Stock Exchange. The Group's core business is the manufacture, sales and distribution of beer products.

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DEFINITIONS

In this announcement the following words have the following meanings, unless the context requires otherwise.

''China Resources Group''	CRC, CRH and their respective subsidiaries
''China Resources Group	any company (or companies) in the China Resources Group,
listed company (or	which is (or are) listed on the Main Board of the Stock
companies)''	Exchange as at the date of this announcement
''Company''	China Resources Beer (Holdings) Company Limited, a
	company incorporated in Hong Kong with limited liability
	and the shares of which are listed on the Main Board of the
	Stock Exchange (Stock Code: 291)
''CR Bank''	珠 海華潤銀行股份有限公司 China Resources Bank of
	Zhuhai Co., Ltd., a municipal bank headquartered in
	Zhuhai, in which CRC holds approximately 75.33% equity
	interest as at the date of this announcement
''CR Trust''	華潤深國投信託有限公司 China Resources SZITIC Trust
	Co., Ltd., in which CRC holds a 51% equity interest as at
	the date of this announcement
''CRC''	China Resources Inc., a joint stock limited liability company
	incorporated in the PRC, which is the holding company of
	CRH and the banking and trust activities in which the China
	Resources Group has an interest
''CRH''	China Resources (Holdings) Company Limited, a company
	incorporated in Hong Kong with limited liability and the
	intermediate holding company of the China Resources
	Group in Hong Kong, holding all the China Resources
	Group's material interests apart from its banking and trust
	activities
''Framework Loan	the Offshore Framework Loan Agreement 2013 and the
Agreements 2013''	Onshore Framework Loan Agreement 2013
''Framework Loan	the Offshore Framework Loan Agreement 2016 and the
Agreements 2016''	Onshore Framework Loan Agreement 2016
''Framework Loan	the Offshore Framework Loan Agreement 2019 and the
Agreements 2019''	Onshore Framework Loan Agreement 2019
''Group''	the Company and its subsidiaries

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''HIBOR''	the Hong Kong Inter-Bank Offered Rate
''Hong Kong''	the Hong Kong Special Administrative Region, the People's
	Republic of China
''independent shareholders''	shareholders of the Company other than CRH and its
	associates, as defined in the Listing Rules
''LIBOR''	the London Inter-Bank Offered Rate, or in case LIBOR is
	not available, a substituted rate generally available in the
	market and generally accepted by market participants as a
	reference lending rate, which rate shall be chosen by the
	relevant parties to replace LIBOR for the purposes of the
	Offshore Framework Loan Agreement 2019
''Listing Rules''	the Rules Governing the Listing of Securities on the Stock
	Exchange
''Offshore Framework Loan	The Framework Loan Agreement and Guarantee for
Agreement 2013''	advances in Hong Kong Dollar, Renminbi and United States
	Dollar entered into by CRH and the Company on 20
	December 2013
''Offshore Framework Loan	The Framework Loan Agreement and Guarantee for
Agreement 2016''	advances in Hong Kong Dollar, Renminbi and United States
	Dollar entered into by CRH and the Company on 22
	December 2016
''Offshore Framework Loan	The Framework Loan Agreement and Guarantee for
Agreement 2019''	advances in Hong Kong Dollar, Renminbi and United States
	Dollar entered into by CRH and the Company on 17
	December 2019
''Onshore Framework Loan	The Framework Loan Agreement and Guarantee for
Agreement 2013''	advances in RMB entered into by CRC and the Company on
	20 December 2013
''Onshore Framework Loan	The Framework Loan Agreement and Guarantee for
Agreement 2016''	advances in RMB entered into by CRC and the Company on
	22 December 2016
''Onshore Framework Loan	The Framework Loan Agreement and Guarantee for
Agreement 2019''	advances in RMB entered into by CRC and the Company on
	17 December 2019
''PRC''	The People's Republic of China, and for the purpose of this
	announcement, excluding Hong Kong, Macau and Taiwan

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''RMB''	Renminbi, the lawful currency of the PRC
''Stock Exchange''	The Stock Exchange of Hong Kong Limited
	By the Order of the board
	China Resources Beer (Holdings) Company Limited
	Lai Po Sing, Tomakin
	Chief Financial Officer,
	Executive Director and
	Company Secretary

Hong Kong, 17 December 2019

As at the date of this announcement, the Executive Directors of the Company are Mr. Jian Yi, Mr. Hou Xiaohai (Chief Executive Officer) and Mr. Lai Po Sing, Tomakin (Chief Financial Officer). The Non-executive Directors of the Company are Mr. Lai Ni Hium, Frank, Mr. Tuen Muk Lai Shu and Mr. Rudolf Gijsbert Servaas van den Brink. The Independent Non-executive Directors of the Company are Mr. Houang Tai Ninh, Dr. Li Ka Cheung, Eric, Dr. Cheng Mo Chi, Moses, Mr. Bernard Charnwut Chan and Mr. Siu Kwing Chue, Gordon.

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