Maanshan Iron & Steel : CONTINUING CONNECTED TRANSACTIONS - AMENDMENTS TO TERMS OF CCT AGREEMENTS

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馬 鞍 山 鋼 鐵 股 份 有 限 公 司

Maanshan Iron & Steel Company Limited

(A joint stock limited company incorporated in the People's Republic of China)

(Stock Code: 00323)

CONTINUING CONNECTED TRANSACTIONS

AMENDMENTS TO TERMS OF CCT AGREEMENTS

1. NEW OUYE LIANJIN SUPPLEMENTAL AGREEMENT

On 15 August 2018, the Company entered into the Original Ouye Lianjin CCT Agreement with Ouye Lianjin, agreeing that, from 1 January 2019 to 31 December 2021, the Group would continue to sell or provide products to Ouye Lianjin, and Ouye Lianjin would continue to sell or provide products and services to the Group. On 7 May 2020, the Company entered into the Existing Ouye Lianjin Supplemental Agreement with Ouye Lianjin, proposing to, as for the products to be sold by Ouye Lianjin to the Group, (i) increase the annual cap for the year 2020 by RMB3,711.7 million from RMB3,796.8 million, with an adjusted annual cap for the year 2020 of RMB7,508.5 million, and (ii) increase the annual cap for the year 2021 by RMB5,070.0 million from RMB4,522.5 million, with an adjusted annual cap for the year 2021 of RMB9,592.5 million.

Due to the impact of the increase in demand and price rise, the caps under the Existing Ouye Lianjin CCT Agreement could not meet the expectation. As such, the Company entered into the New Ouye Lianjin Supplemental Agreement with Ouye Lianjin, proposing to, as for the products to be sold by Ouye Lianjin to the Group, increase the annual cap for the year 2021 by RMB921.4 million from RMB9,592.5 million, with an adjusted annual cap for the year 2021 of RMB10,513.9 million. All other existing principal terms and conditions under the Original Ouye Lianjin CCT Agreement and Existing Ouye Lianjin Supplemental Agreement remain unchanged.

The Company has confirmed that as of the date of this announcement, the transaction amount under the Original Ouye Lianjin CCT Agreement and Existing Ouye Lianjin Supplemental Agreement has not exceeded the existing annual caps.

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As of the date of this announcement, the Parent Company holds approximately 47.59% of the issued share capital of the Company and is the controlling shareholder of the Company. It also holds 69.83% equity interests of Ouye Lianjin, meaning that Ouye Lianjin is a subsidiary of the Parent Company and a connected person of the Company under Chapter 14A of the Listing Rules. Therefore, the transactions under the New Ouye Lianjin Supplemental Agreement would constitute the continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

As the applicable percentage ratios under the Listing Rules in respect of the proposed annual caps for the transactions contemplated under the New Ouye Lianjin Supplemental Agreement on an annual basis are more than 5%, such continuing connected transactions and proposed annual caps are subject to requirements including reporting, announcement, annual review and Independent Shareholders' approval under Chapter 14A of the Listing Rules.

1. NEW MAGANG GROUP SUPPLEMENTAL AGREEMENT

On 15 August 2018, the Company entered into the Original Magang Group CCT Agreement with the Parent Company, agreeing that, from 1 January 2019 to 31 December 2021, the Group would continue to sell or provide products and services to the Parent Group, and the Parent Group would continue to sell or provide products and services to the Group. On 7 May 2020, the Company entered into the Existing Magang Group Supplemental Agreement with the Parent Company, as for the infrastructure technical and renovation engineering services provided by the Parent Group, (i) increase the annual cap for the year 2020 by RMB1,600 million from RMB1,100 million, with an adjusted annual cap for the year 2020 of RMB2,700 million, and (ii) increase the annual cap for the year 2021 by RMB900 million from RMB1,000 million, with an adjusted annual cap for the year 2021 of RMB1,900 million.

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Due to the impact of the increase in demand and price rise, the caps under the Original Magang Group CCT Agreement could not meet the expectation. As such, the Company entered into the New Magang Group Supplemental Agreement with the Parent Company, proposing to, (i) as for the products to be sold by the Group to the Parent Group, increase the annual cap for the year 2021 by RMB385 million from RMB1,165.3714 million, with an adjusted annual cap for the year 2021 of RMB1,550.3714 million, and (ii) as for the water and land transportation and related services, including highway transport, waterway transport, integrated port services (including cargo loading and unloading, storage, lump ore screening, transfer and short-distance handling, weighing, pickup and delivery, etc.), storage and delivery services, equipment (facility) maintenance services for production support, overhaul and medium maintenance of equipment, project and maintenance services for electrical, motor and transformer, operation and maintenance service and modification regarding automation and informatization, wheel processing services, agency services and automobile repair, monitoring and diagnostic services and related services, increase the annual cap for the year 2021 by RMB392.83 million from RMB3,010.1403 million, with an adjusted annual cap for the year 2021 of RMB3,402.9703 million. All other existing principal terms and conditions under the Original Magang Group CCT Agreement and the Existing Magang Group Supplemental Agreement remain unchanged.

The Company has confirmed that as of the date of this announcement, the transaction amount under the Original Magang Group CCT Agreement and the Existing Magang Group Supplemental Agreement has not exceeded the existing annual caps.

As at the date of this announcement, the Parent Company is interested in approximately 47.59% of the Company's share capital and is the controlling shareholder and connected person of the Company. The transactions under the New Magang Group Supplemental Agreement would constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

As the applicable percentage ratios under the Listing Rules in respect of the proposed annual caps for the transactions contemplated under the New Magang Group Supplemental Agreement on an annual basis are expected to be more than 5%, such continuing connected transactions are subject to requirements including reporting, announcement, annual review and Independent Shareholders' approval under Chapter 14A of the Listing Rules.

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III. NEW CHINA BAOWU SUPPLEMENTAL AGREEMENT

On 30 December 2019, the Company entered into the Original Ordinary Related Transaction Agreement with China Baowu, agreeing that, from 1 January 2020 to 31 December 2020, the Group would continue to sell or provide products and services to China Baowu Group, and China Baowu Group would sell or provide products and services to the Group. On 7 May 2020, the Company entered into the Existing China Baowu Supplemental Agreement with China Baowu to (i) increase the annual cap for the year 2020 by RMB10,334.7 million from RMB787 million, with an adjusted annual cap for the year 2020 of RMB11,121.7 million; and (ii) newly set the annual cap of the products and services for the year 2021 of RMB19,893.09 million.

Due to the impact of the increase in demand and price rise, the caps under the Existing China Baowu Supplemental Agreement could not meet the expectation. As such, the Company entered into the New China Baowu Supplemental Agreement with China Baowu, proposing to, (i) increase the annual cap of the products sold by the Group to China Baowu Group for the year 2021 by RMB943.61 million from RMB232.92 million, with an adjusted annual cap for the year 2021 of RMB1,176.53 million, and (ii) increase the annual cap of the products sold by China Baowu Group to the Group for the year 2021 by RMB3,980 million from RMB14,784.45 million, with an adjusted annual cap for the year 2021 of RMB18,764.45 million. All other existing principal terms and conditions under the Existing Ordinary Related Transactions Agreement and the Existing China Baowu Supplemental Agreement remain unchanged.

The Company has confirmed that as of the date of this announcement, the transaction amount under the Original Ordinary Related Transactions Agreement and the Existing China Baowu Supplemental Agreement has not exceeded the existing annual caps.

As of the date of the announcement, China Baowu is the controlling shareholder of the Parent Company, and indirectly holds a total of 57.19% equity interests of the Company. According to Chapter 14A of the Listing Rules, China Baowu is a connected person of the Company, and therefore, the transactions under the New China Baowu Supplemental Agreement are continuing connected transactions under Chapter 14A of the Listing Rules.

As the applicable percentage ratios under the Listing Rules in respect of the proposed annual caps for the transactions contemplated under the New China Baowu Supplemental Agreement are more than 5%, such continuing connected transactions and proposed annual caps are subject to requirements including reporting, announcement, annual review and Independent Shareholders' approval under Chapter 14A of the Listing Rules.

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IV. SUPPLEMENTAL ENERGY SAVING AND ENVIRONMENTAL PROTECTION AGREEMENT

On 30 December 2018, the Company and Anhui Xinchuang entered into the Existing Energy Saving and Environmental Protection Agreement for the continuous provision of energy saving and environmental protection construction and services by Anhui Xinchuang to the Group and the sale of power, energy medium and finished products by the Group to Anhui Xinchuang during the period from 1 January 2019 to 31 December 2021.

Due to the impact of the increase in demand and price rise, the caps under the Existing Energy Saving and Environmental Protection Agreement could not meet the expectation. As such, the Company and Anhui Xinchuang entered into the Supplemental Energy Saving and Environmental Protection Agreement, proposing to increase the annual caps for the year 2021 for power, energy medium and finished products to be sold by the Group to Anhui Xinchuang by RMB109.46 million from RMB81 million, with an adjusted annual caps for the year 2021 of RMB190.46 million. All other existing principal terms and conditions under the Existing Energy Saving and Environmental Protection Agreement remain unchanged.

The Company has confirmed that as of the date of this announcement, the transaction amount under the Existing Energy Saving and Environmental Protection Agreement has not exceeded the existing annual caps.

As at the date of this announcement, China Baowu is the controlling shareholder of the Parent Company, and indirectly holds a total of 57.19% equity interests of the Company. Anhui Xinchuang is a company controlled by China Baowu, and is therefore, a connected person of the Company. Accordingly, the transactions contemplated under the Supplemental Energy Saving and Environmental Protection Agreement and the CCT Supplemental Agreement would constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

As the applicable percentage ratios under the Listing Rules in respect of the proposed annual caps for the transactions contemplated under the Supplemental Energy Saving and Environmental Protection Agreement (in aggregate with other CCT supplemental Agreements) are more than 5%, such continuing connected transactions and proposed annual caps are subject to requirements including reporting, announcement, annual review and Independent Shareholders' approval under Chapter 14A of the Listing Rules.

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