SHANGHAI PRIME MACHINERY COMPANY LIMITED 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 limited company incorporated in the People's Republic of China)
(Stock Code: 02345) INSIDE INFORMATION - POTENTIAL DISPOSALS INSIDE INFORMATION - POTENTIAL DISPOSALS
The following information is made by the Company pursuant to the Inside Information Provisions (as defined under the Listing Rules) of Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and Rule 13.09 of the Listing Rules.
On 17 April 2015, the Board approved the resolutions regarding the potential disposals of
65% equity interest in Cyeco Environmental to SEI and 20% equity interest in Shanghai Dalong to SEG for considerations of approximately RMB199 million and RMB22 million, respectively (subject to the confirmation and record of the competent state-owned assets supervision and administration departments).
The Board wishes to emphasize that the Company has not entered into any legally binding agreements or any equity transfer agreements with any parties in relation to the Potential Disposals as of the date of this announcement. The Company will make further announcement regarding the Potential Disposals pursuant to the applicable requirement under the Listing Rules in due course.
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INSIDE INFORMATION - POTENTIAL DISPOSALS
The following information is made by the Company pursuant to Inside Information Provisions (as defined under the Listing Rules) of Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and Rule 13.09 of the Listing Rules.
On 17 April 2015, the Board approved the resolutions regarding the potential disposals of 65% equity interest in Cyeco Environmental to SEI and 20% equity interest in Shanghai Dalong to SEG for considerations of approximately RMB199 million and RMB22 million, respectively (subject to the confirmation and record of the competent state-owned assets supervision and administration departments).
The Board wishes to emphasize that the Company has not entered into any legally binding agreements or any equity transfer agreements with any parties in relation to the Potential Disposals as of the date of this announcement. The Company will make further announcement regarding the Potential Disposals pursuant to the applicable requirement under the Listing Rules in due course.
The principal terms of the Potential Disposals are summarised as follows: Parties: The Company, as vendor
SEI, as purchaser
SEG, as purchaser
Subject matter: Purchaser SEI SEG
65% equity
interest in Cyeco
Environmental
20% equity interest in
Shanghai Dalong
Consideration: Approximately RMB221 million in total, comprising
1) approximately RMB199 million for the proposed disposal of
65% equity interest in Cyeco Environmental to SEI;
2) approximately RMB22 million for the proposed disposal of 20%
equity interest in Shanghai Dalong to SEG;
arrived at after arm's length negotiation between the Company and SEI and between the Company and SEG on normal commercial terms in compliance with applicable laws (subject to the confirmation and record of the competent state-owned assets supervision and administration departments).
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Cyeco Environmental
Cyeco Environmental is principally engaged in environmental engineering and development, transfer and consultation of technologies for ships in the area of corrosion and pollution prevention, design and research of electrolytic devices for protecting ships from marine life, installation of impressed current cathodic protection on ship bodies and ballast water treatment devices, sale of marine equipment and accessories, marine instruments and water paint as well as installation, maintenance and services for ships, electric and engineering, chemical, environmental protection equipment and construction, with a registered capital of RMB50,000,000.
Shanghai Dalong
Shanghai Dalong is principally engaged in designing and manufacturing various types of reciprocating compressors, screw compressors, diaphragm pumps and high-pressure reciprocating pumps, which can be applied in different fields, such as petroleum industry, coal chemistry, soda ash and other heavy industries, with a registered capital of RMB146,228,747.87.
REASONS FOR AND BENEFITS OF THE PROPOSED DISPOSALS
Taking into account the operating conditions and the principal businesses of Cyeco Environmental and Shanghai Dalong, the Directors consider that the Proposed Disposals will improve the financial performance of the Group and allow the Group to focus on its core businesses, define its strategic position more clearly, and strengthen and expand its predominant businesses.
Mr. Wang Qiang, being a Director, is also a senior management of SEG and therefore has abstained from voting on the relevant board resolutions approving the Potential Disposals contemplated thereunder in accordance with the requirements of the Listing Rules. Save as disclosed above, none of the Directors has any material interest in the Potential Disposals.
The Group is principally engaged in designing, manufacturing and selling turbine blades, bearings, fasteners and cutting tools.
SEG is principally engaged in the management of state-owned assets and investment activities. The ultimate beneficial owner of SEG is the State-owned Assets Supervision and Administration Commission of Shanghai Municipal Government.
SEI is principally engaged in the management and operation of state-owned assets and investment activities. SEI is wholly owned by SEG.
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DEFINITIONS
In this announcement, unless the context requires otherwise, the following terms have the meanings as set out below:
"Board" the board of directors of the Company;
"Company" Shanghai Prime Machinery Company Limited (Jjfl:!fli!!1lll!
5J:1�0PJ), a joint stock limited company incorporated in the
PRC, whose H shares are listed on The Stock Exchange of Hong
Kong Limited (stock code: 02345);
"Cyeco Environmental" Jjfl :1�0PJ (Shanghai Cyeco Environmental Technology Co., Ltd.), a company incorporated in the PRC and is owned by the Company as to 65%;
"Directors" the directors of the Company;
"Group" the Company and its subsidiaries;
"Hong Kong" the Hong Kong Special Administrative Region of the PRC;
"Listing Rules" t h e Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited;
"Potential Disposals" t h e proposed disposals of 65% equity interest in Cyeco Environmental to SEI and 20% equity interest in Shanghai Dalong to SEG by the Company;
"PRC" the People's Republic of China but excluding, for the purpose of this announcement only, Hong Kong, Macau Special Administrative Region of the PRC and Taiwan;
"RMB" Renminbi, the lawful currency of the PRC;
"SEG" Jjfl��(:!f/II)�0PJ (Shanghai Electric (Group) Corporation), the controlling shareholder of the Company (as defined under the Listing Rules) holding approximately 49.75% beneficial interest in the total issued share capital of the Company as of the date of this announcement;
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"SEI" _t���-��/30RJ (Shanghai Electrical Industry Company Limited), a wholly owned subsidiary of SEG as of the date of this announcement;
"Shanghai Dalong" _t�jcft�ffLi�/30RJ (Shanghai Dalong Machinery Factory Company Limited), a company incorporated in the PRC and is owned by the Company as to 20%; and
"Share(s)" domestic share(s) and/or H share(s) of the Company.
By order of the Board of
Chairman
Shanghai, the PRC
17 April 2015
As at the date of this announcement, the Board consists of executive directors, namely Mr. Wang Qiang, Mr. Zhou Zhiyan, Mr. Zhang Jianping, Ms. Zhu Xi, Mr. Sun Wei, Mr. Chen Hui and independent non-executive directors, namely Mr. Chan Oi Fat, Mr. Ling Hong and Mr. Li Yin.
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