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9 Jun 2015 12:46
DATANG INTERNATIONAL POWER GENERATION COMPANY LD - Continuing Connected TransactionsDATANG INTERNATIONAL POWER GENERATION COMPANY LD - Continuing Connected Transactions
PR Newswire
London, June 9
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.
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
CONTINUING CONNECTED TRANSACTIONS
Reference is made in accordance with the announcement of the Company dated 23 December 2014 in respect of, among others, the Fuel Purchase Framework Agreement (Beijing).
SUPPLEMENTAL AGREEMENT
On 9 June 2015, the Company and Beijing Datang Fuel Company entered into the Supplemental Agreement, pursuant to which the Company agreed the joining of the Three Subsidiaries to purchase coal from Beijing Datang Fuel Company for a term commencing from 1 May 2015 to 31 December 2015, with the condition that the approved maximum transaction amount under the Fuel Purchase Framework Agreement (Beijing) (i.e. RMB21,289 million) shall not be exceeded.
LISTING RULES IMPLICATIONS
As at the date of this announcement, CDC is the controlling shareholder of the Company, which together with its subsidiaries hold approximately 34.71% of the issued share capital of the Company. Since CDC and its subsidiary, Datang Fuel Company, directly or indirectly hold certain equity interests in Beijing Datang Fuel Company, which is a subsidiary of the Company, such subsidiaries are connected persons of the Company. The transactions contemplated under the Supplemental Agreement constitute continuing connected transactions of the Company.
Since the transaction amount under the Supplemental Agreement is included in the approved maximum transaction amount under the Fuel Purchase Framework Agreement (Beijing), the Supplemental Agreement and the transaction contemplated thereunder are subject to the reporting and announcement requirements, but are exempted from the independent shareholders' approval requirements under Chapter 14A of the Listing Rules.
Reference is made in accordance with the announcement of the Company dated 23 December 2014 in respect of, among others, the Fuel Purchase Framework Agreement (Beijing).
SUPPLEMENTAL AGREEMENT
Date
9 June 2015
Parties
The Company, Beijing Datang Fuel Company
Major terms
(1) Subject matter: Datang Fuel Company agreed the joining of the Three Subsidiaries to purchase coal from Beijing Datang Fuel Company during the term of the agreement.
The parties and the Three Subsidiaries may, from time to time during the term of the agreement, enter into specific sale contracts in respect of the sale of coal, and such specific sale contracts shall be subject to the terms of the Supplemental Agreement.
(2) Consideration: To be determined in the ordinary course of business on normal commercial terms on the basis of arm's length negotiation according to prevailing market conditions.
(3) Settlement and payment: Settlement shall be made by the relevant parties in accordance with the confirmed settlement invoice.
(4) Term: Commencing from 1 May 2015 to 31 December 2015.
(5) The Supplemental Agreement becomes effective when they are duly signed by the parties.
Annual Cap
It is expected that the maximum transaction amount in respect of the Supplemental Agreement for the year ending 31 December 2015 is RMB400 million; such amount is determined with reference to (i) the anticipated quantity of coal to be purchased by the Three Subsidiaries from Beijing Datang Fuel Company for the year ended 31 December 2015; and (ii) the estimated market price of coal.
The aggregate maximum transaction amount under the Fuel Purchase Framework Agreement (Beijing) and the Supplemental Agreement will not exceed RMB21,289 million, which is the annual cap under the Fuel Purchase Framework Agreement (Beijing) approved by the independent shareholders of the Company in the 2015 first extraordinary general meeting of the Company held on 10 February 2015.
PROCEDURES FOR DETERMINATION OF COAL PRICING POLICY
The consideration for the purchase of coal under the Supplemental Agreement is to be determined with reference to the market price of coal and on normal commercial terms on the basis of arm's length negotiation according to market conditions. Please refer to the announcement of the Company dated 23 December 2014 and the circular of the Company dated 22 January 2015 for the specific factors in determination of the consideration by the Company.
REASONS FOR AND BENEFITS OF ENTERING INTO THE SUPPLEMENTAL AGREEMENT
The purchase of coal by the Company and its subsidiaries from Beijing Datang Fuel Company is primarily for securing coal supply to the Company and the power generation enterprises of its subsidiaries, and fully leveraging the advantages in terms of supply and economy-of-scale of purchase of these specialised coal companies, so as to stabilise the market prices of coal to a certain extent, thereby exercising control over the costs of fuel and mitigating the adverse impact of changes in the coal market on the Group.
The Directors (including the independent non-executive Directors) are of the view that the terms of the Supplemental Agreement are fair and reasonable, have been entered into after arm's length negotiation between all parties thereto and determined on normal commercial terms and is in the interests of the Company and the Shareholders as a whole. None of the Directors has material interest in the transactions under the Supplemental Agreement. Connected Directors, including Chen Jinhang, Hu Shengmu and Liang Yongpan, have abstained from voting for this resolution at the relevant Board meeting pursuant to the listing rules of the Shanghai Stock Exchange.
INFORMATION ON THE PARTIES TO THE AGREEMENT
1. The Company is principally engaged in the construction and operation of power plants, the sale of electricity and thermal power, the repair and maintenance of power equipment and power related technical services. The Company's main service areas are in the PRC.
2. CDC was established on 9 March 2003 with registered capital of RMB18.009 billion. It is principally engaged in the development, investment, construction, operation and management of power energy, organisation of power (thermal) production and sales; manufacture, repair and maintenance of power equipment; power technology development and consultation; power engineering, contracting and consultation of environmental power engineering; development of new energy as well as development and production of power related coal resources.
3. Beijing Datang Fuel Company is a subsidiary of the Company. It is principally engaged in sale of coal, investment management and technical services. The equity holding structure of the company is as follows: 51% of its equity interest is held by the Company and 49% of its equity interest is held by Datang Fuel Company, a wholly-owned subsidiary of CDC.
4. Datang Fuel Company is a wholly-owned subsidiary of CDC with registered capital of RMB644 million. It is principally engages in the business of electric fuel.
LISTING RULES IMPLICATIONS
As at the date of this announcement, CDC is the controlling shareholder of the Company, which together with its subsidiaries hold approximately 34.71% of the issued share capital of the Company. Since CDC and its subsidiary, Datang Fuel Company, directly or indirectly hold certain equity interests in Beijing Datang Fuel Company, which is a subsidiary of the Company, such subsidiaries are connected persons of the Company. The transactions contemplated under the Supplemental Agreement constitute continuing connected transactions of the Company.
Since the transaction amount under the Supplemental Agreement are included in the approved maximum transaction amount under the Fuel Purchase Framework Agreement (Beijing), the Supplemental Agreement and the transaction contemplated thereunder is subject to the reporting and announcement requirements, but are exempted from the independent shareholders' approval requirements under Chapter 14A of the Listing Rules.
DEFINITIONS
In this announcement, unless the context otherwise requires, the following expressions have the following meanings:
| "Beijing Datang Fuel Company" | Beijing Datang Fuel Company Limited, a subsidiary of the Company, details of which are set out in the section headed "Information on the Parties to the Agreement" | |
| "Board" | the board of Directors | |
| "CDC" | China Datang Corporation, a state-owned enterprise established under the laws of the PRC and is the controlling shareholder of the Company which, together with its subsidiaries, own approximately 34.71% of the issued share capital of the Company as at the date of this announcement | |
| "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(s)" | has the meaning ascribed to it under the Listing Rules | |
| "connected transaction(s)" | has the meaning ascribed to it under the Listing Rules | |
| "Directors" | the director(s) of the Company | |
| "Datang Fuel Company" | Datang Electric Power Fuel Company Limited, a wholly-owned subsidiary of CDC, details of which are set out in the section headed "Information on Parties to the Agreement" | |
| "Fuel Purchase Framework Agreement (Beijing)" | the coal purchase and sale framework agreement dated 23 December 2014 entered into between the Company and Beijing Datang Fuel Company, details of which please refer to the announcement of the Company dated 23 December 2014 and the circular of the Company dated 22 January 2015 | |
| "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 | |
| "Stock Exchange" | The Stock Exchange of Hong Kong Limited | |
| "Supplemental Agreement" | The "Coal Purchase and Sale Framework Supplemental Agreement" entered into between the Company and Beijing Datang Fuel Company dated 9 June 2015 | |
| "Three Subsidiaries" | Jiangxi Datang International Fuzhou Power Generation Company Limited, Liaoning Datang International Jinzhou Thermal Power Company Limited, Chongqing Datang International Shizhu Power Generation Company Limited, all being subsidiaries of the Company | |
| "%" | percent |
By Order of the Board Zhou Gang Secretary to the Board
Beijing, the PRC, 9 June 2015
As at the date of this announcement, the Directors of the Company are:Chen Jinhang, Hu Shengmu, Wu Jing, Lian Yongpan, Zhou Gang,Cao Xin, Cai Shuwen, Liu Haixia, Guan Tiangang, Yang Wenchun,Dong Heyi*, Ye Yansheng*, Zhao Jie*, Jiang Guohua*, Feng Genfu*
* Independent non-executive Directors
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