Datang Intl H Regulatory News (DAT)

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take noresponsibility for the contents of this announcement, make no representation as to itsaccuracy or completeness and expressly disclaim any liability whatsoever for any losshowsoever arising from or in reliance upon the whole or any part of the contents of thisannouncement. DATANG INTERNATIONAL POWER GENERATION CO., LTD. (a sino-foreign joint stock limited company incorporated in the People's Republic of China) (Stock Code: 00991) ANNOUNCEMENT CONNECTED TRANSACTION CAPITAL INCREASE AGREEMENT AND EQUITY TRANSFER AGREEMENT 1. Capital Increase Agreement On 30 June 2014, the Company entered into the Capital Increase Agreement with Datang NuclearPower Company and CDC, pursuant to which the parties agreed that the Company shall inject its24% of equity interests (valued at approximately RMB132,088,300) in Liaoning Nuclear PowerCompany into Datang Nuclear Power Company, with a view to increase the amount of capitalinjection by the Company in Datang Nuclear Power Company, and that CDC shall agree toincrease the capital by RMB198,132,500 in proportion to its equity holding in Datang NuclearPower Company. Upon completion of the capital increase, the Company will have made capitalcontribution in the total sum of RMB156,088,300 in Datang Nuclear Power Company and itsequity holding will remain as 40%, while CDC will have made capital contribution in the totalsum of RMB234,132,500 in Datang Nuclear Power Company and its equity holding will remain at60%. 2. Equity Transfer Agreement Given the entry into the Capital Increase Agreement, the Company entered into an EquityTransfer Agreement with Datang Nuclear Power Company on 30 June 2014, pursuant to which theCompany agreed to transfer the 24% equity interests in Liaoning Nuclear Power Company toDatang Nuclear Power Company for a price of RMB132,088,300. LISTING RULES IMPLICATIONS As at the date of this announcement, CDC is the controlling Shareholder of the Company, whichtogether with its subsidiaries holds 34.71% of the issued share capital of the Company.Datang Nuclear Power Company is a subsidiary of CDC. Accordingly, CDC and Datang NuclearPower Company are connected persons of the Company under Chapter 14A of the Listing Rules.The transactions contemplated under the Capital Increase Agreement and the Equity TransferAgreement constitute connected transactions of the Company. As one or more of the applicable percentage ratios (as defined under Rule 14.07 of theListing Rules) in respect of the Capital Increase Agreement and the Equity Transfer Agreementis more than 0.1% but less than 5% and all other applicable percentage ratios are less than0.1%, the Capital Increase Agreement and the Equity Transfer Agreement are only subject tothe reporting and announcement requirements under Chapter 14A of the Listing Rules, but isexempted from the approval by the independent Shareholders of the Company under Chapter 14Aof the Listing Rules. I. CAPITAL INCREASE AGREEMENT Date 30 June 2014 Parties 1. The Company; 2. CDC; and 3. Datang Nuclear Power Company. Major Terms of the Capital Increase Agreement: 1. Pursuant to the valuation report (Tian Xing Ping Bao Zi (2014) No. 0220) issued by Pan-China Assets Appraisal Co., Ltd. as at the Valuation Benchmark Date, the 24% equity interests of Liaoning Nuclear Power Company held by the Company was valued at RMB132,088,300 by adopting asset-based method; and the parties agreed that the Company shall increase its capital contribution in Datang Nuclear Power Company based on the afore-mentioned valuation of the 24% equity interests of Liaoning Nuclear Power Company, and that CDC shall increase its capital contribution in Datang Nuclear Power Company in proportion to its equity holding (60%) in Datang Nuclear Power Company. 2. The amount of capital increase agreed by the parties was as follows: (1) As at the Valuation Benchmark Date, the paid up capital injected by CDC to Datang Nuclear Power Company totaled RMB36,000,000; and CDC agreed to further increase its capital contribution to Datang Nuclear Power Company in the amount of RMB198,132,500 under the Capital Increase Agreement. (2) As at the Valuation Benchmark Date, the paid up capital injected by the Company to Datang Nuclear Power Company totaled RMB24,000,000; and the Company agreed to further increase its capital contribution to Datang Nuclear Power Company in the amount of RMB132,088,300 by injecting its 24% equity interests of Liaoning Nuclear Power Company. The shareholding structure of Datang Nuclear Power Company and the amount of capitalcontribution as well as proportion of shareholding of each shareholders of Datang NuclearPower Company before and upon completion of the capital increase are set out as below: Name of Capital Shareholding Capital Capital ShareholdingShareholder injection prior structure prior injected for injected after structure to the to the this capital the capital after the completion of completion of increase increase capital capital capital (RMB'000) (RMB'000) increase increase increase (RMB'000) CDC 36,000 60% 198,132.5 234,132.5 60%The Company 24,000 40% 132,088.3 156,088.3 40%Total 60,000 100% 330,220.8 390,220.8 100% 3. Timing of making the capital contribution: (1) CDC shall deposit the capital contribution amount in cash in full to the designated account of Datang Nuclear Power Company after the effective date of the Capital Increase Agreement and within 10 working days of completing the change of shareholders of Liaoning Nuclear Power Company; (2) within 60 working days upon the effective date of the Capital Increase Agreement, the Company shall make capital contribution based on the valuation of 24% equity interests of Liaoning Nuclear Power Company and the holder of the 24% equity interests of Liaoning Nuclear Power Company shall be changed to Datang Nuclear Power Company and the necessary procedures required for the change of shareholders of Liaoning Nuclear Power Company and the capital contribution of Datang Nuclear Power Company shall be completed. 4. In the event that during the period between the Valuation Benchmark Date and the date of change of the shareholder of Liaoning Nuclear Power Company, the Company increases its capital contribution to Liaoning Nuclear Power Company pursuant to the resolution of the general meeting of Liaoning Nuclear Power Company, the specific amount of such capital contribution shall be confirmed by the specialised audit report recognised by both the Company and Datang Nuclear Power Company and settled by Datang Nuclear Power Company as soon as possible after the date of change of the shareholder of Liaoning Nuclear Power Company. 5. Effective Date: the agreement will be made upon signing by the legal representatives or authorised representatives of the parties, and become effective upon affixing of company seals by the parties. II. EQUITY TRANSFER AGREEMENT Date 30 June 2014 Parties 1. The Company; and 2. Datang Nuclear Power Company. Major Terms of the Equity Transfer Agreement: 1. The parties agreed that pursuant to the valuation report issued by Pan-China Assets Appraisal Co., Ltd. as at the valuation date on 31 December 2013, based on the 24% equity interests in Liaoning Nuclear Power Company held by the Company valued at RMB132,088,300 as the price for the equity transfer, the Company shall transfer the 24% equity interests in Liaoning Nuclear Power Company to Datang Nuclear Power Company. 2. Upon completion of the equity transfer, the Company shall no longer directly hold any equity interest in Liaoning Nuclear Power Company; the Company shall increase capital by RMB132,088,300 in Datang Nuclear Power Company; and the Company's total capital contribution to Datang Nuclear Power Company shall be changed to RMB156,088,300; 3. Effective Date: the agreement will become effective upon signing and affixing of company seals by the legal representatives or authorised representatives of the parties. REASONS FOR AND BENEFITS OF ENTERING INTO THE CAPITAL INCREASE AGREEMENT AND THE EQUITYTRANSFER AGREEMENT The entry and completion of the Capital Increase Agreement and the Equity Transfer Agreementwith parties will increase the capital contribution by the Company to Datang Nuclear PowerCompany with the 24% equity interests of Liaoning Nuclear Power Company, in proportion tothat of CDC. It will further reinforce the strength of the principle business of DatangNuclear Power Company, and fully leverage the professional management and technologicaladvantages of the nuclear power business of Datang Nuclear Power Company for effectivelyproceeding with the preliminary work on the Liaoning nuclear project, thereby acceleratingthe smooth implementation of the Company's strategy to "develop nuclear power in a safe andhighly efficient manner". The Directors (including independent non-executive Directors) are of the view that thiscapital contribution is made on normal commercial terms of the Company and the transaction isfair and reasonable, and is in the interest of the Shareholders of the Company as a whole. APPROVAL BY THE BOARD None of the Directors have any material interest in the transaction. Those connectedDirectors, including Chen Jinhang, Hu Shengmu and Fang Qinghai, all being key managementstaff of CDC, have abstained from voting at the Board meeting for approval of the relevanttransaction in accordance with the requirements of the listing rules of the Shanghai StockExchange. INFORMATION OF THE RELEVANT PARTIES Information about the Company The Company is principally engaged in the construction and operation of power plants, thesale of electricity and thermal power, the repair and maintenance of power equipment andpower related technical services, with its main service areas being in the PRC. Information about CDC CDC was established on 9 March 2003 with a registered capital of RMB18.009 billion. It isprincipally engaged in the development, investment, construction, operation and management ofpower energy, organization of power (thermal) production and sales; manufacturing, repair andmaintenance of power equipment; power technology development and consultation; powerengineering, contracting and consultation of environmental power engineering; development ofnew energy as well as development and production of power related coal resources. Information about Datang Nuclear Power Company Datang Nuclear Power Company was established on 17 October 2013 with a registered capital ofRMB200,000,000. It is principally engaged in technological development, project investment,technical services and management of nuclear power and related areas. It is owned as to 60%by CDC and 40% by the Company. Information about Liaoning Nuclear Power Company Established in March 2009, Liaoning Nuclear Power Company is planned to consist of 6��1,000MWnuclear generating units. Phase 1 of the construction is planned to consist of 2��1,000MWnuclear generating units which is on preliminary planning stage. Equity holders and theproportion of capital contribution to Liaoning Nuclear Power Company made by each party wereas follow: China National Nuclear Power Co., Ltd accounts for 50%. The Company accounts for24%. Jiangsu Guoxin Investment Group Limited accounts for 12%. Zhejiang Zheneng ElectricPower Co., Ltd accounts for 10%. ZOC Investment Co., Ltd. accounts for 4%. Liaoning Nuclear Power Company did not have any net profits (both before and after taxation)for the two financial years ended 31 December 2012 and 31 December 2013. In 2014, the Company entrusted Ruihua Certified Public Accountants and Pan-China AssetsAppraisal Co., Ltd to conduct financial audit and asset valuation on Liaoning Nuclear PowerCompany as at 31 December 2013. Financial auditing results: As at Valuation Benchmark Date on31 December 2013, Liaoning Nuclear Power Company's total assets were RMB3,392,147,500; Totalliabilities were RMB2,877,122,700; Net assets were RMB515,024,800. Valuation: As at ValuationBenchmark Date on 31 December 2013, the assets of Liaoning Nuclear Power Company was valuedat RMB3,427,490,800 by adopting asset-based method; Total liabilities were RMB2,877,122,700;Net assets were RMB550,368,100, which is RMB35,343,400 or 6.86% higher than the audited bookvalue of net assets of RMB515,024,800. LISTING RULES IMPLICATIONS As at the date of this announcement, CDC is the controlling Shareholder of the Company, whichtogether with its subsidiaries hold 34.71% of the issued share capital of the Company. DatangNuclear Power Company is a subsidiary of CDC. Accordingly, CDC and Datang Nuclear PowerCompany are connected persons of the Company under Chapter 14A of the Listing Rules. Thetransactions contemplated under the Capital Increase Agreement and the Equity TransferAgreement constitute connected transactions of the Company. As one or more of the applicable percentage ratios (as defined under Rule 14.07 of theListing Rules) in respect of the Capital Increase Agreement and the Equity Transfer Agreementis more than 0.1% but less than 5% and all other applicable percentage ratios are less than0.1%, the Capital Increase Agreement and the Equity Transfer Agreement are only subject tothe reporting and announcement requirements under Chapter 14A of the Listing Rules, but isexempted from the approval by the independent Shareholders of the Company under Chapter 14Aof the Listing Rules. DEFINITIONS In this announcement, unless the context otherwise requires, the following expressions havethe following meanings: "Board" the board of Directors "Capital Increase Agreement" the "Capital Increase Agreement of China Datang Corporation Nuclear Power Co., Ltd." entered into between the Company, CDC and Datang Nuclear Power Company on 30 June 2014 in relation to the capital increase to Datang Nuclear Power Company "CDC" China Datang Corporation, a State-owned enterprise established under the laws of the PRC and is the controlling Shareholder of the Company under the Listing Rules "Company" Datang International Power Generation Co., Ltd., a sino-foreign joint stock limited company incorporated in the PRC on 13 December 1994, whose H Shares are listed on the Stock Exchange and the London Stock Exchange and whose A Shares are listed on the Shanghai Stock Exchange "connected person" has the meaning ascribed to it under the Listing Rules "connected transaction" has the meaning ascribed to it under the Listing Rules "Datang Nuclear Power Company" China Datang Corporation Nuclear Power Co., Limited, details of which are set out in the section entitled "Information of the Relevant Parties" "Directors" the director(s) of the Company "Equity Transfer Agreement" the Equity Transfer Agreement entered into between the Company and Datang Nuclear Power Company on 30 June 2014 "Liaoning Nuclear Power Company" CNNC Liaoning Nuclear Power Co., Ltd., as at the date of this announcement, the Company holds 24% of its equity interests "Listing Rules" the Rules Governing the Listing of Securities on the Stock Exchange "PRC" the People's Republic of China "RMB" Renminbi, the lawful currency of the PRC "Shareholder(s)" the shareholders of the Company "Stock Exchange" The Stock Exchange of Hong Kong Limited "Valuation Benchmark Date" 31 December 2013 "%" percent By Order of the Board Zhou Gang Secretary to the Board Beijing, the PRC, 2 July 2014 As at the date of this announcement, the Directors of the Company are: Chen Jinhang, Hu Shengmu, Wu Jing, Fang Qinghai, Zhou Gang, Li Gengsheng, Cao Xin,Cai Shuwen, Liu Haixia, Guan Tiangang, Dong Heyi*, Ye Yansheng*, Li Hengyuan*, Zhao Jie*,Jiang Guohua* * Independent non-executive Directors