Datang Intl H Regulatory News (DAT)

20 Apr 2006 07:00

Datang Intl Power Generation Co Ld20 April 2006 The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes norepresentation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any losshowsoever 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: 991) PROPOSED ISSUE OF A SHARES IN THE PRC CONNECTED TRANSACTION With reference to the announcement dated 6 May 2004 issued by the Company and the Company's circular dated 27 May 2004,the Company intended to apply to the CSRC for the issue of not more than one billion A Shares. The A Shares Issue wasconditionally approved by the shareholders of the Company by way of special resolutions at the 2004 EGM and by holdersof H Shares and domestic shares of the Company in the respective 2004 CSM. These resolutions were, in compliance withand as legally required under the relevant PRC laws, passed with effect for a period of one year from the date of the2004 EGM and the 2004 CSMs, each expired on 21 June 2005. With reference to the announcement dated 4 May 2005 issued by the Company and the Company's circular dated 25 May 2005,the Company sought to obtain the approval from the Company's shareholders for the refreshment of all relevantresolutions relating to the A Shares Issue in the same structure and manner and in essentially identical terms as thoseconsidered and passed at the 2004 EGM and the 2004 CSMs for a one-year period expiring on 20 June 2006. Such approvalfrom the Company's shareholders had been obtained by way of special resolutions sought at the 2004 AGM and 2005 CSMsheld on 21 June 2005. As at the date of this announcement, the Company had applied to the CSRC for the A Shares Issue and the CSRC hadindicated on 1 April 2005 its acceptance to review such application. The A Shares Issue is, as at the date hereof, notcompleted due to the fact that the formal approval from the CSRC is still pending and the Company will endeavour tocomplete the A Shares Issue as soon as practicable. In the circumstances, the Board has resolved to seek approval fromthe Company's shareholders, by way of special resolutions to be sought at the 2005 AGM and the 2006 CSMs, to refreshfor a further one-year period from the date of the 2005 AGM and 2006 CSMs all relevant resolutions relating to the AShares Issue in the same structure and manner and in essentially identical terms as those considered and passed at the2004 EGM and 2004 CSMs. As each of CDGC and TJIC is the substantial shareholder of the Company holding approximately 35.43% and 10.84% of itsentire issued share capital, respectively, as at the date of this announcement, the extension of the validity period ofa further one year from the date of the 2005 AGM and 2006 CSMs for each of the Private Placement Arrangementsconstitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. In this regard, the Boardhas appointed the Independent Board Committee to consider and advise the Independent Shareholders, for the purpose ofconsidering the special resolution to be sought at the 2005 AGM to refresh for a further one-year period from the dateof the 2005 AGM and 2006 CSMs the relevant resolution regarding the proposed issue of A Shares to each of CDGC and TJICunder the Private Placement Arrangements and has appointed an independent financial adviser to advise the IndependentBoard Committee and the Independent Shareholders on this matter. The Company will soon issue and despatch to its shareholders the notice convening the 2005 AGM and the 2006CSMs,together with the reply slip for attendance and proxy form, and a circular containing, among other things, informationrelating to the A Shares Issue, the recommendations of the Independent Board Committee and the advice of theindependent financial adviser to the Independent Board Committee and the Independent Shareholders. INTRODUCTION With reference to the announcement dated 6 May 2004 issued by the Company and the Company's circular dated 27 May 2004,the Company intended to apply to the CSRC for the issue of not more than one billion A Shares. The A Shares Issue wasconditionally approved by the shareholders of the Company by way of special resolutions at the 2004 EGM and by holdersof H Shares and domestic shares of the Company in the respective 2004 CSM. These resolutions were, in compliance withand as legally required under the relevant PRC laws, passed with effect for a period of one year from the date of the2004 EGM and the 2004 CSMs, each expired on 21 June 2005. With reference to the announcement dated 4 May 2005 issued by the Company and the Company's circular dated 25 May 2005,the Company sought to obtain the approval from the Company's shareholders for the refreshment of all relevantresolutions relating to the A Shares Issue in the same structure and manner and in essentially identical terms as thoseconsidered and passed at the 2004 EGM and the 2004 CSMs for a one-year period expiring on 20 June 2006. Such approvalfrom the Company's shareholders had been obtained by way of special resolutions sought at the 2004 AGM and 2005 CSMsheld on 21 June 2005. As at the date of this announcement, the Company had applied to the CSRC for the A Shares Issue and the CSRC hadindicated on 1 April 2005 its acceptance to review such application, The A Shares Issue is, as at the date hereof, notcompleted due to the fact that the formal approval from the CSRC in respect of the same is still pending, and theCompany will endeavour to complete the A Shares Issue as soon as practicable. In the circumstances, the Board has, incompliance with the relevant PRC laws and regulations, resolved to seek approval from the Company's shareholders, byway of special resolutions to be sought at the 2005 AGM and the 2006 CSMs, to approve the following: (a) conditional on the passing of the resolution as set out in paragraph (b) below, to further refresh the validity period of all relevant resolutions relating to the A Shares Issue and referred to in special resolutions numbered 1 (save as the Private Placement Arrangements) in the notice of the 2004 EGM and in special resolution in the notice of each of the 2004 CSMs, all dated 6 May 2004 issued by the Company, in the same structure and manner and in essentially identical terms as those considered and passed at the 2004 EGM and the 2004 CSMs for a further one- year from the date of the 2005 AGM and the 2006 CSMs, respectively; and(b) conditional on the passing of the resolution as set out in paragraph (a) above, to further refresh the validity period of the Private Placement Arrangements considered and passed at the 2004 EGM and the 2004 CSMs for a further one-year period from the date of the 2005 AGM and the 2006 CSMs, respectively. CDGC and TJIC and their respective associates will abstain from voting on the resolution set out in paragraph (b) aboveat the 2005 AGM. PROPOSED A SHARES ISSUE Structure of the A Shares Issue The proposed structure of the A Shares Issue is set out below: (1) Type of securities to be issued: RMB denominated ordinary shares of the Company.(2) Number of A Shares to be issued: Not more than one billion A Shares, the exact number of which shall be determined by the Board as proposed to be authorised by the shareholders of the Company at the 2005 AGM and the 2006 CSMs.(3) Par value: RMB1.00 per share.(4) Target subscribers: The A Shares will be issued in two tranches, namely, to (a) the existing holders of domestic shares of the Company through the Private Placement Arrangements; and (b) natural persons and institutional investors (except those prohibited by PRC laws or regulations) within the PRC through the Public Subscription Tranche, who are not connected persons (as defined in the Listing Rules) of the Company. (i) Private Placement Arrangements CDGC and TJIC, part of the existing holders of domestic shares of the Company, intended to subscribe at the same issue price as the A Shares to be issued under the Public Subscription Tranche for not more than 301,704,761 and 92,358,600 A Shares (based on the issue of one billion A Shares), respectively, representing approximately 30.17% and 9.24% of the total number of A Shares to be issued (based on the issue of 1 billions A Shares), respectively. If the total number of A Shares to be issued is less than one billion, the number of A Shares to be placed to each of CDGC and TJIC will be adjusted accordingly with reference to the total number of A Shares to be issued. The extension of the validity period for each of the Private Placement Arrangements to CDGC and TJIC constitutes connected transaction of the Company under the Listing Rules, which is subject to the approval by the Independent Shareholders at the 2005 AGM.(ii) Public Subscription Tranche The Company intends to issue not more than 605,936,639 A Shares (based on the issue of one billion A Shares) to natural persons and institutional investors (except those prohibited by PRC laws or regulations) within the PRC. (5) Issue price and pricing process: The issue price of the A Shares will be determined in accordance with strict market principles based on the PRC securities market condition at the time when the A Shares Issue takes place. The final issue price as well as the pricing mechanism will, as may be required under the relevant PRC laws and regulations, be subject to be approved by all relevant PRC regulatory authorities including the CSRC.(6) Use of proceeds: It is intended that not more than RMB6 billion will be raised from the A Shares Issue and the proceeds there from are intended to be used as follows: (a) approximately RMB261 million to complete the Datang Shentou power generation project;(b) approximately RMB113 million to complete the Datang Liancheng power generation project;(c) approximately RMB321 million to complete the Datang Honghe power generation project;(d) approximately RMB854 million to complete the Datang Pengshui hydropower generation project;(e) approximately RMB547 million to complete phase III of the Datang Tuoketuo power generation project;(f) approximately RMB1,089 million to complete the Datang Chaozhou power generation project;(g) approximately RMB235 million to complete phase I of the Datang Ningde power generation project; and(h) approximately RMB506 million to complete phase 1 of the Datang Wushashan power generation project. The remaining balance of the proceeds from the A Shares Issue, if any, will be used as working capital of the Companyand to development other projects to be approved by the Board and the relevant government authorities in the PRC andfurther announcement will be made in compliance with the Listing Rules as and when required. To the extent that theproceeds of the A Shares Issue are not sufficient to fund the above projects, the Company will use its internalresources if necessary.Further details in respect of the use of proceeds will be disclosed in the circular to be despatched to theshareholders of the Company. Shareholders' approvals passed at the 2004 EGM and 2004 CSMs, the refreshment of such approvals at the 2004 AGM and2005 CSMs and further refreshment of such approvals The A Shares Issue and all ancillary matters (including the proposed amendments to be made to the articles ofassociation of the Company in connection with, and to cater for, the A Shares Issue) were conditionally approved by wayof special resolutions passed at the 2004 EGM and the 2004 CSMs, and the valid period of such approval was extended atthe 2004 AGM and 2005 CSMs for a year from the date of the 2004 AGM and 2005 CSMs. These resolutions were, incompliance with and as legally required under the relevant PRC laws, passed with effect for a period from the date ofthe 2004 EGM and the 2004 CSMs until 20 June 2006. As at the date of this announcement, the Company had applied to the CSRC for the A Shares Issue and the CSRC hadindicated on 1 April 2005 its acceptance to review such application. The A Shares Issue is, as at the date hereof, notcompleted due to the fact that the formal approval from CSRC is still pending, and the Company will endeavour tocomplete the A Shares Issue as soon as practicable. In the circumstances, the Board has, in compliance with therelevant PRC laws and regulations, resolved to seek approval from the Company's shareholders, by way of specialresolutions to be sought at the 2005 AGM and the 2006 CSMs, to approve the following: (a) conditional on the passing of the resolution as set out in paragraph (b) below, to further refresh the validity period of all relevant resolutions relating to the A Shares Issue and referred to in special resolutions numbered 1 (save as the Private Placement Arrangements) in the notice of the 2004 EGM and in special resolution in the notice of each of the 2004 CSMs, all dated 6 May 2004 issued by the Company, in the same structure and manner and in essentially identical terms as those considered and passed at the 2004 EGM and the 2004 CSMs for a further one- year from the date of the 2005 AGM and 2006 CSMs, respectively; and(b) conditional on the passing of the resolution as set out in paragraph (a) above, to further refresh the validity period of the Private Placement Arrangements considered and passed at the 2004 EGM and the 2004 CSMs for a further one-year period from the date of the 2005AGM and 2006 CSMs, respectively. CDGC and TJIC and their respective associates will abstain from voting on the resolution set out in paragraph (b) aboveat the 2005 AGM. REASONS FOR AND BENEFITS OF THE A SHARES ISSUE The Directors believe that with the proceeds raised from the A Share Issue, the Company could further develop itsbusiness in the development, construction and operation of power plants in the PRC. The A Shares Issue will alsoprovide the Company with an alternative channel to raise further capital and will enhance the shareholders base andenlarge the capital base of the Company. It will also enhance the profile of the Company in the PRC. EFFECTS OF THE A SHARES ISSUE ON THE COMPANY'S CAPITAL STRUCTURE Set out below is a summary of the changes in the shareholding percentage of the Company prior to and immediately uponcompletion of the A Shares Issue based on the assumption that the entire one billion A Shares will be issued and theConvertible Bond issued by the Company will be fully converted into 222,127,074 H Shares (based on the conversion priceof HK$5.4 per H Share) immediately upon completion of the A Shares Issue: Shareholding Immediately upon Shareholding Prior to the percentage (%) completion of the Percentage (%)Type of shares A Shares Issue (approximate) A Shares Issue (approximate)1. Domestic shares: CDGC 1,828,768,200 35.43 2,130,472,961 (1) 33.37 BEIH 671,792,400 13.01 671,792,400 10.52 HCIC 671,792,400 13.01 671,792,400 10.52 TJIC 559,827,000 10.84 652,185,600 (2) 10.212. Listed shares: A Shares held by public - - 605,936,639 9.49 H Shares held by public 1,430,669,000 27.71 1,652,796,074 (3) 25.89 Total 5,162,849,000 100.00 6,384,976,074 100.00 Notes: (1) Include the 301,704,761 A Shares to be issued under the Private Placement Arrangements.(2) Include the 92,358,600 A Shares to be issued under the Private Placement Arrangements.(3) Include the Convertible Bond issued by the Company assumed to be fully converted into 222,127,074 H Shares. Set out below is a summary of the changes in the shareholding percentage of the Company prior to and immediately uponcompletion of the A Shares Issue based on the assumption that the entire one billion A Shares will be issued and noconversion of the Convertible Bond has taken place immediately upon completion of the A Shares Issue: Shareholding Immediately upon Shareholding Prior to the percentage (%) completion of the Percentage (%)Type of shares A Shares Issue (approximate) A Shares Issue (approximate)1. Domestic shares: CDGC 1,828,768,200 35.43 2,130,472,961 (1) 34.57 BEIH 671,792,400 13.01 671,792,400 10.90 HCIC 671,792,400 13.01 671,792,400 10.90 TJIC 559,827,000 10.84 652,185,600 (2) 10.582. Listed shares: A Shares held by public - - 605,936,639 9.83 H Shares held by public 1,430,669,000 27.71 1,430,669,000 (3) 23.21 Total 5,162,849,000 100.00 6,162,849,000 100.00 Notes: (1) Include the 301,704,761 A Shares to be issued under the Private Placement Arrangements.(2) Include the 92,358,600 A Shares to be issued under the Private Placement Arrangements.(3) Assuming no conversion of the Convertible Bond has taken place. CONNECTED TRANSACTIONS As at the date of this announcement, each of CDGC and TJIC holds approximately 35.43% and 10.84% of the issued sharecapital of the Company respectively and therefore each of them is a substantial shareholder of the Company (as definedin the Listing Rules). By virtue of these relationships, each of the Private Placement Arrangements constitutesconnected transaction under Chapter 14A of the Listing Rules and is subject to the approval by the IndependentShareholders in the 2005 AGM. In accordance with the Listing Rules, CDGC and TJIC and their respective associates will be abstained from voting inthe resolution(s) regarding each of the Private Placement Arrangements. 2005 AGM AND 2006 CSMs The Board has resolved to convene the 2005 AGM to approve, among other things, special resolutions to refresh for afurther one-year period all relevant resolutions relating to the A Shares Issue and referred to in special resolutionsnumbered 1 (save as the Private Placement Arrangements) in the notice of the 2004 EGM and in special resolution in thenotice of each of the 2004 CSMs, all dated 6 May 2004 issued by the Company, in the same structure and manner and inessentially identical terms as those considered and passed at the 2004 EGM and the 2004 CSMs, with, in respect of therelevant resolution regarding the Private Placement Arrangements, CDGC and TJIC and their respective associatesabstaining from voting. The Company will soon issue and despatch to its shareholders the notice convening the 2005 AGM and the 2006 CSMs,together with the reply slip for attendance and proxy form, and a circular containing, among other things, informationrelating to the A Shares Issue, the recommendations of the Independent Board Committee to the Independent Shareholders,for the purpose of considering the special resolutions to be sought at the 2005 AGM to refresh for a further one-yearperiod the relevant resolution relating to each of the Private Placement Arrangements under the proposed A SharesIssue, on the terms of such proposed issue of A Shares to each of CDGC and TJIC, and the advice of the independentfinancial adviser to the Independent Board Committee and the Independent Shareholders. DEFINITIONS In this announcement, the following expressions have the meanings set out below unless the context requires otherwise: "2004 AGM" the annual general meeting of the Company for the year ended 31 December 2004 held on 21 June 2005"2004 CSMs" the class shareholders meeting of the Company for each of the holders of H Shares and holders of domestic shares of the Company held on 22 June 2004"2004 EGM" the extraordinary general meeting of the Company held on 22 June 2004"2005 AGM" the annual general meeting of the Company for the year ended 31 December 2005"2005 CSMs" the class shareholders meeting of the Company for each of the holders of H Shares and holders of domestic shares of the Company held on 21 June 2005"2006 CSMs" the class shareholders meeting of the Company for each of the holders of H Shares and holders of domestic shares of the Company to be held in 2006"A Share(s)" the domestic ordinary share(s) of the Company with a nominal value of RMB1.00 each which are to be subscribed in RMB and are proposed to be issued by the Company to (i) part of the existing holders of domestic shares of the Company and (ii) natural person and institutional investors in the PRC"A Shares Issue" the proposed issue of A Shares to (i) part of the existing holders of domestic shares of the Company and (ii) natural person and institutional public investors in the PRC by the Company. The A Shares, subject to the relevant approval of the relevant authorities in the PRC, are proposed to be listed on the Shanghai Stock Exchange"associates" having the meaning ascribed to it under the Listing Rules"BEIH" Beijing Energy Investment Holding Company Limited ("Chinese Words"), is a substantial shareholder of the Company. Beijing Energy Investment Holding Company Limited is a state-owned enterprise resulted from the merger between the Company's original shareholder Beijing International Power Development Investment Company and Beijing Integrated Investment Company. Beijing International Power Development Investment Company originally held 13.01% of the Company's issued share capital, which is now being held by Beijing Energy Investment Holding Company Limited"Board" the board of Directors"CDGC" China Datang Corporation ("Chinese Words"), a state-owned enterprise established under the laws of the PRC and is a substantial shareholder of the Company holding approximately 35.43% of the issued share capital of the Company"Company" Datang International Power Generation Co. Ltd. ("Chinese Words"), a sino-foreign joint stock limited company incorporated in the PRC on 13 December 1994, the H Shares of which are listed on the Hong Kong Stock Exchange and the London Stock Exchange "Convertible Bond" the convertible bond issued by the Company on 3 September 2003 which can be converted into new H Shares"CSRC" China Securities Regulatory Commission"Directors" the directors of the Company"HCIC" Hebei Construction Investment Company ("Chinese Words"), a state-owned enterprise established under the laws of the PRC and a substantial shareholder of the Company holding approximately 13.01% of the issued share capital of the Company"H Shares" the overseas listed foreign shares of the Company with a nominal value of RMB1.00 each and are listed on the Hong Kong Stock Exchange and the London Stock Exchange"Hong Kong" the Hong Kong Special Administrative Region of the PRC"Hong Kong Stock Exchange" The Stock Exchange of Hong Kong Limited"Independent Board Committee" a committee of the Board, comprising the independent Directors, to be established for the purposes of advising the Independent Shareholders in respect of each of the Private Placement Arrangements"Independent Shareholders" shareholders of the Company other than CDGC and TJIC, their respective associates and any parties acting in concert with them"Listing Rules" the Rules Governing the Listing of Securities on the Hong Kong Stock Exchange"London Stock Exchange" The London Stock Exchange Limited"Private Placement Arrangements" the proposed private placing of A Shares to CDGC and TJIC at the same issue price as the A Shares to be issued under the Public Subscription Tranche."PRC" the People's Republic of China"Public Subscription Tranche" the public offer of A Shares to natural person and institutional investors in the PRC. Such A Shares are proposed to be listed on the Shanghai Stock Exchange"RMB" Renminbi, the lawful currency of the PRC"TJIC" Tianjin Jinneng Investment Company ("Chinese Words"), a state-owned enterprise established under the laws of the PRC and a substantial shareholder of the Company holding approximately 10.84% of the issued share capital of the Company By Order of the Board Datang International Power Generation Co., Ltd. Yang Hongming Company Secretary Beijing, the PRC, 19 April 2006 As at the date of this announcement, the Directors are: Zhai Ruoyu. Zhang Yi, Hu Shengmu, Fang Qinghai, Yang Hongming, Liu Haixia, Guan Tiangang, Su Tiegang, Ye Yonghui, TongYunshang, Xie Songlin*, Xu Daping*, Liu Chaoan*, Yu Changchun* and Xia Qing* * independent non-executive Directors This information is provided by RNS The company news service from the London Stock Exchange