Shougang Concord Century : DISCLOSEABLE TRANSACTION - ACQUISITION OF MACHINERY

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: 103)

DISCLOSEABLE TRANSACTION

ACQUISITION OF MACHINERY

THE ACQUISITION

The Board is pleased to announce that on 29 November 2019, the Purchaser, an indirect wholly-owned subsidiary of the Company, entered into the Purchase Contract with the Vendor for the acquisition of the steel cord production machines at a total contract price of RMB71,972,000 (equivalent to approximately HK$80,248,780).

IMPLICATION UNDER THE LISTING RULES

As the highest applicable percentage ratio (as defined under the Listing Rules) in respect of the Acquisition exceeds 5% but is less than 25%, the Acquisition constitutes a discloseable transaction of the Company under the Listing Rules and is therefore subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.

1

THE ACQUISITION

The Board is pleased to announce that on 29 November 2019, the Purchaser, an indirect wholly-owned subsidiary of the Company, entered into the Purchase Contract with the Vendor for the acquisition of the steel cord production machines. The principal terms of the Purchase Contract are set out below:

Date:	29 November 2019
Parties:	(i)	the Purchaser; and
	(ii)	the Vendor.

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries:

1. according to public information, as at the date of this announcement, the ultimate controlling shareholders of the Vendor are Zhang Degang, Zhang Deqiang and Zhang Jinghua, all being PRC merchants;
2. the principal business of the Vendor includes engaging in the manufacturing and sale of a range of equipment for manufacturing steel wire production lines; and
3. as at the date of this announcement, the Vendor and its ultimate beneficial owners are Independent Third Parties.

Assets acquired:	The steel cord production machines
Date of delivery:	Batch 1: before 28 February 2020
	Batch 2: expected to be September 2020
Total contract price:	RMB 71,972,000	(equivalent	to	approximately

HK$80,248,780), inclusive of value-added tax, transportation costs, on-site installation cost (if applicable) and tuning cost, which shall be paid by the Purchaser to the Vendor in batch by bank acceptance bills in the following manner:

The contract price of batch 1 is RMB 42,780,200 (equivalent to approximately HK$47,699,923) and will be paid in the following manner:

2

	(i)	10% of the contract price of batch 1 to be paid as
		prepayment when the Purchase Contract is signed;
	(ii)	40% of the contract price of batch 1 to be paid within 30
		days after delivery, installation and tuning of batch 1 of
		the steel cord production machines and after the same
		having been checked and accepted;
	(iii)	40% of the contract price of batch 1 to be paid within 6
		months after delivery, installation and tuning of batch 1
		of the steel cord production machines and after the same
		having been checked and accepted; and
	(iv)	10% of the contract price of batch 1 to be paid as quality
		guarantee within 30 days after the quality check having
		been passed following expiry of the 24-month warranty
		period of batch 1 of the steel cord production machines.
	The contract price of batch 2 is RMB 29,191,800 (equivalent to
	approximately HK$32,548,857) and will be paid in the same
	manner as to the payment of batch 1 after the date of delivery of
	batch 2 is confirmed.
	The total contract price was determined after arm's length
	negotiations between the parties after considering the market
	price of brand new steel cord production machines and the
	existing condition of the steel cord production machines. The
	total contract price will be settled by the Group with internal
	resources and/or other financing.
Liability for breach:	In case the steel cord production machines delivered to the
	Purchaser by the Vendor do not accord with its specifications set

out in the Purchase Contract causing failure for the purpose of the Purchase Contract, the Vendor shall return the contract price to the Purchaser and, after negotiation of the amount of damages, pay damages to compensate the Purchaser's loss.

For delay caused by the Vendor, the Vendor shall pay the Purchaser damages at the rate of 0.5% of the total contract price per day of delay. For delay of more than 20 days, the Purchaser has the right to cancel the Purchase Contract. The Vendor shall return the contract price and, after negotiation of the amount of damages, pay damages to compensate the Purchaser's loss.

3

In the event that either the Vendor or the Purchaser terminates the contract without any proper reason, in addition to payment of damages for all loss due to the failure of fulfilment of the Purchase Contract, the breaching party shall pay the innocent party 20% of the total contract price as damages.

REASONS FOR AND BENEFITS OF THE ACQUISITION

The Group is principally engaged in (i) manufacturing of steel cords for radial tyres and (ii) manufacturing of sawing wires.

The Acquisition is part of the capital investment for the construction of the production lines in TESC Phase II Project, which will enhance the efficiency of production for both JESC and the Purchaser, and will thereby expect to bring positive impact on the performance of the steel cord segment of the Company.

The Directors consider that the terms of the Purchase Contract are on normal commercial terms and are fair and reasonable and that the Acquisition is in the interests of the Company and its shareholders as a whole.

IMPLICATION UNDER THE LISTING RULES

As the highest percentage ratio (as defined under the Listing Rules) in respect of the Acquisition exceeds 5% but is less than 25%, the Acquisition constitutes a discloseable transaction of the Company under the Listing Rules and is therefore subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.

4

DEFINITIONS

"Acquisition"

"Board"

"Company"

"Director(s)" "Group" "HK$" "Hong Kong"

"Independent Third Parties"

"JESC"

"Listing Rules"

"PRC"

"Purchaser" or "TESC"

"Purchase Contract"

"RMB"

"Stock Exchange"

the acquisition of the steel cord production machines pursuant to the Purchase Contract

the board of Directors

Shougang Concord Century Holdings Limited, a company incorporated in Hong Kong with limited liability and the issued shares of which are listed on the Main Board of the Stock Exchange (Stock code: 103)

director(s) of the Company

the Company and its subsidiaries

Hong Kong dollar(s), the lawful currency of Hong Kong

the Hong Kong Special Administrative Region of the PRC

third party independent of the Company and its connected persons (having the meaning ascribed to it under the Listing Rules)

Jiaxing Eastern Steel Cord Co., Ltd., a company incorporated under the laws of the PRC and an indirect wholly-owned subsidiary of the Company

the Rules Governing the Listing of Securities on the Stock Exchange

the People's Republic of China, which for the purpose of this announcement, excludes Hong Kong, Macau and Taiwan

Tengzhou Eastern Steel Cord Co., Ltd., a company incorporated under the laws of the PRC and an indirect wholly- owned subsidiary of the Company

the purchase contract dated 29 November 2019 entered into between the Purchaser and the Vendor in respect of the Acquisition

Renminbi, the lawful currency of the PRC

The Stock Exchange of Hong Kong Limited

5

"TESC Phase II	the construction project of production lines with an annual
Project"	capacity of 20,000 tonnes of brass wires (half product or work in
	progress)
"Vendor"	Wuxi Sunlit Science and Technology Company Limited* (無錫
	盛力達科技股份有限公司), a company established in the PRC
	and the issued shares of which are listed on the Main Board of
	the Stock Exchange (Stock code: 1289)
"%"	per cent.

In this announcement, for the purpose of illustration only, amounts quoted in RMB has been converted into HK$ at the rate of RMB1.00 to HK$1.115. Such exchange rate has been used, where applicable, for the purpose of illustration only and do not constitute a representation that any amounts were or may have been exchanged at this or any other rates or at all.

By order of the Board

Shougang Concord Century Holdings Limited

SU Fanrong

Chairman and Managing Director

Hong Kong, 29 November 2019

As at the date of this announcement, the Board comprises the following Directors:

Mr. Su Fanrong (Chairman and Managing Director), Mr. Tang Cornor Kwok Kau (Deputy Managing Director), Mr. Liao Jun (Non-executive Director), Mr. Ye Qian (Non-executive Director), Mr. Yip Kin Man, Raymond (Independent Non-executive Director), Mr. Law, Yui Lun (Independent Non-executive Director) and Mr. Lam Yiu Kin (Independent Non-executive Director).

* For identification purpose only

6