C&D Property Management Group Co., Ltd - Proxy Solicitation & Information Statement 2013

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in CHINA SANDI HOLDINGS LIMITED, you should at once hand this circular, together with the enclosed form of proxy, to the purchaser(s) or transferee(s) or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司

(formerly known as China Grand Forestry Green Resources Group Limited

前稱中國林大綠色資源集團有限公司) (incorporated in Bermuda with limited liability) (Stock code: 00910)

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

A notice convening a special general meeting of CHINA SANDI HOLDINGS LIMITED (formerly known as ‘‘China Grand Forestry Green Resources Group Limited’’) to be held at 11:00 a.m. on Monday, 23 September 2013 at 3/F., Nexxus Building, 77 Des Voeux Road Central, Hong Kong is set out on pages S-1 to S-2 of this circular. A form of proxy for use at the special general meeting is enclosed. Such form of proxy is also published on the websites of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the Company (www.chinasandi.com.hk).

Whether or not you are able to attend and vote at the special general meeting, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the Company’s Hong Kong branch registrar, Tricor Tengis Limited at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong as soon as practicable but in any event not less than 48 hours before the time appointed for holding the special general meeting or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the special general meeting or any adjournment thereof (as the case may be) should you so wish.

A letter from the Board is set out on pages 5 to 17 of this circular. A letter from the Independent Board Committee is set out on pages 18 to 19 of this circular. A letter from Nuada is set out on pages 20 to 27 of this circular.

4 September 2013

		Page
Definitions	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from	the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Letter from	the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	18
Letter from	Nuada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
Appendix I	— Financial Information of the Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	I-1
Appendix II	— General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	II-1
Notice of SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		S-1

– i –

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

‘‘associates’’ has the same meaning ascribed thereto in the Listing Rules
‘‘Bid Bond’’ a bid bond to be paid by the project company to 西安市新城區國土資源局 (The Bureau of Land and Resources of Xincheng District of Xi’an*) according to the requirements set out in the Transfer Notice, which is expected to be RMB200 million (equivalent to approximately HK$250 million)
‘‘Board’’ the board of Directors
‘‘Company’’
China Sandi Holdings Limited, a company incorporated in Bermuda with limited liability, the shares of which are listed on the main board of the Stock Exchange
‘‘connected person(s)’’ has the meaning ascribed to it under the Listing Rules
‘‘Cooperation Agreement’’ a cooperation agreement to be entered between Fujian Jiake and the Reconstruction Office
‘‘Director(s)’’
director(s) of the board of the Company
‘‘Earnest Monies’’ the refundable earnest monies to be paid to the Reconstruction Office of RMB200 million (equivalent to approximately HK$250 million), of which (i) RMB120 million (equivalent to approximately HK$150 million) to be paid within 7 days upon signing the Cooperation Agreement and (ii) RMB80 million (equivalent to approximately HK$100 million) to be paid to the Reconstruction Office three months prior to the date of the Transfer Notice
‘‘Fujian Jiake’’ 福建佳科實業有限公司 (Fujian Jiake Industrial Co., Ltd.*), a joint venture company to be established in the PRC and to be held as to 51% and 49% by Fujian Sinco and Fuzhou Gaojia respectively pursuant to the terms of the Fujian Jiake JV Agreement
‘‘Fujian Jiake JV Agreement’’ the joint venture agreement dated 7 August 2013 entered into between Fujian Sinco and Fuzhou Gaojia
‘‘Fujian Sinco’’
福建先科實業有限公司 (Fujian Sinco Industrial Co. Ltd.*), a company established in the PRC and an indirect whollyowned subsidiary of the Company

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DEFINITIONS

‘‘Fuzhou Gaojia’’
‘‘Group’’
‘‘Independent Board Committee’’
‘‘Independent Shareholders’’
‘‘Independent Third Party(ies)’’
‘‘JV Companies’’
‘‘JV Company’’
‘‘Land’’
‘‘Land Bidding’’
‘‘Latest Practicable Date’’
‘‘Listing Rules’’
‘‘Mr. Guo’’
‘‘Nuada’’
福州高佳房地產開發有限公司 (Fuzhou Gaojia Real Estate Development Co., Ltd.*), a company established in the PRC
the Company and its subsidiaries
the independent board committee of the Board comprising all the independent non-executive Directors, namely Dr. Wong Yun Kuen, Mr. Chan Chi Yuen, Mr. Yu Pak Yan, Peter, Mr. Zheng Jinyun and Mr. Zheng Yurui, established to advise the Independent Shareholders in respect of the terms of the Fujian Jiake JV Agreement and the transactions contemplated thereunder
all Shareholders other than Mr. Guo and his associates
any person(s) or company(ies) and their respective ultimate beneficial owner(s) are third parties independent of the Company and its connected persons
Fujian Jiake and the JV Company
a joint venture company to be established in the PRC and to be held as to 51% and 49% by Fujian Jiake and the Potential JV Partner respectively
one plot of land located at 西安曲江大明宮遺址區 (Xi’an Qujiang Daming Palace Heritage Area*) with a total site area of approximately 40 mu (畝)
the public bidding of the Land
30 August 2013, being the latest practicable date for ascertaining certain information for inclusion of this circular
the Rules Governing the Listing of Securities on the Stock Exchange
Mr. Guo Jiadi, the controlling Shareholder and the controlling shareholder of Fuzhou Gaojia
Nuada Limited, a corporation licensed under the SFO to carry out type 6 (advising on corporate finance) regulated activity as defined under the SFO, being the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders as to fairness and reasonableness of the terms of the Fujian Jiake JV Agreement and transactions contemplated thereunder

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DEFINITIONS

‘‘Potential JV Partner’’ the potential joint venture partner(s) of the JV Company, who will beneficially own 49% interest in the JV Company and be the Independent Third Party(ies)

‘‘PRC’’ the People’s Republic of China

‘‘PRC Legal Adviser’’ 福建博世律師事務所 (Fujian Bose Law Firm*), the PRC legal adviser of the Company
‘‘Project’’ the commercial property development project to be developed on the Land
‘‘Reconstruction Office’’ 西安曲江大明宮遺址區保護改造辦公室 (Xi’an Qujiang Daming Palace Heritage Area Protection And Reconstruction Office*), one of the parties to the Cooperation Agreement
‘‘SFO’’ Securities and Futures Ordinance, Cap. 571 of the Laws of Hong Kong
‘‘SGM’’ the special general meeting of the company to be convened and held to approve, among other things, the Fujian Jiake JV Agreement and transactions contemplated thereunder
‘‘Share(s)’’ the ordinary Share(s) of HK$0.01 each in the share capital of the Company
‘‘Shareholder(s)’’ shareholder(s) of the Company
‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited
‘‘Supplemental Agreement’’ the supplemental agreement signed between Fujian Sinco and Fuzhou Gaojia dated 30 August 2013 in relation to the Fujian Jiake JV Agreement
‘‘Target Price’’ the target consideration for the Land of approximately RMB400 million (equivalent to approximately HK$500 million)

‘‘Transfer Notice’’ the construction land use right transfer notice to be published by 西安市新城區國土資源局 (The Bureau of Land and Resources of Xincheng District of Xi’an*) in relation to the Land

‘‘Xi’an’’ the capital city of Shaanxi Province, the PRC
‘‘HK$’’ Hong Kong dollars, the lawful currency of Hong Kong

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DEFINITIONS

‘‘RMB’’ Renminbi, the lawful currency of the PRC ‘‘%’’ per cent.

The English transliteration of the Chinese name(s) in this circular, where indicated, is included for information purpose only, and should not be regarded as the official English name(s) of such Chinese name(s).

For the purpose of this circular, conversion of RMB into HK$ is based on the exchange rate of RMB1 to HK$1.25. The exchange rate has been used, where applicable, for the purposes of illustration only and does not constitute a representation that any amount is or may have been exchanged at this or any other rates or at all.

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LETTER FROM THE BOARD

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司

(formerly known as China Grand Forestry Green Resources Group Limited 前稱中國林大綠色資源集團有限公司)

(incorporated in Bermuda with limited liability) (Stock code: 00910)

Executive Directors: Mr. Chi Chi Hung, Kenneth Ms. Zhang Jianchan

Independent Non-Executive Directors: Dr. Wong Yun Kuen Mr. Chan Chi Yuen Mr. Yu Pak Yan, Peter Mr. Zheng Jinyun Mr. Zheng Yurui

Registered office: Clarendon House 2 Church Street Hamilton HM 11 Bermuda

Head office and principal place of business in Hong Kong: Unit 3309 33rd Floor, West Tower Shun Tak Centre 168–200 Connaught Road Central Hong Kong

4 September 2013

To the Shareholders,

Dear Sir or Madam,

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

INTRODUCTION

Reference is made to the announcement of the Company dated 7 August 2013. On 7 August 2013, Fujian Sinco, an indirect wholly-owned subsidiary of the Company and Fuzhou Gaojia entered into the Fujian Jiake JV Agreement pursuant to which both parties have agreed (i) to establish Fujian Jiake and the JV Company to engage in investment, development, sale, lease, management of properties and other ancillary services in the PRC and (ii) to bid for and acquire the Land.

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LETTER FROM THE BOARD

The purpose of this circular is to provide you with, among others, (a) further information of the Fujian Jiake JV Agreement and the transactions contemplated thereunder; (b) a letter of advice containing the recommendation from the Independent Board Committee to the Independent Shareholders; (c) a letter of advice from Nuada to the Independent Board Committee and the Independent Shareholders; and (d) a notice convening the SGM.

THE FUJIAN JIAKE JV AGREEMENT

The principal terms of the Fujian Jiake JV Agreement are as follows:

Date: 7 August 2013 (as supplemented by the Supplemental Agreement dated 30 August 2013)

Parties:

(1) Fujian Sinco, an indirect wholly-owned subsidiary of the Company; and
(2) Fuzhou Gaojia.

To the best information, knowledge and belief of the Directors after making necessary enquiries, as at the Latest Practicable Date, Fuzhou Gaojia is owned as to approximately 96.51% and 3.49% by 郭氏投資集團有限公司 (Guo Shi Investment Group Co. Limited) (‘‘Guo Shi’’) and 福建艾建商貿有限公司 (Fujian Ai Jian Trading Co., Limited) (‘‘Fujian Ai Jian’’). Guo Shi is owned as to 95% and 5% by Mr. Guo and Mr. Guo Dehai (郭德海), the father of Mr. Guo, respectively. Fujian Ai Jian is owned by the Independent Third Parties. As at the Latest Practicable Date, Mr. Guo is the single largest Shareholder indirectly interested in 200,000,000 Shares (by virtue of his beneficial interest in approximately 29.11% of the existing issued share capital of the Company as at the Latest Practicable Date). Therefore, Fuzhou Gaojia is regarded as a connected person of the Company.

Formation of Fujian Jiake

Pursuant to the terms of the Fujian Jiake JV Agreement, Fujian Jiake will be established in the PRC for a term of 40 years.

. Business scope of Fujian Jiake

The business scope of Fujian Jiake will include, among other things, investment, development, sale, lease, management of properties and other ancillary services in the PRC.

. Registered capital of Fujian Jiake

Fujian Jiake will be a limited company established in the PRC with a registered capital of RMB216 million (equivalent to approximately HK$270 million), which will be owned as to 51% and 49% by Fujian Sinco and Fuzhou Gaojia respectively. Pursuant to the Fujian Jiake JV Agreement, Fujian Sinco and Fuzhou Gaojia have agreed to make a capital contribution in cash of RMB110 million (equivalent to approximately HK$137.5 million) and RMB106 million (equivalent to approximately HK$132.5 million)

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LETTER FROM THE BOARD

respectively to the registered capital of Fujian Jiake, which represents the total capital commitment of Fujian Sinco and Fuzhou Gaojia to Fujian Jiake. Such capital contribution was determined after arm’s length negotiation between Fujian Sinco and Fuzhou Gaojia with reference to the initial funding requirement to bid for the Land and will be applied to satisfy Fujian Jiake’s funding obligation under the Cooperation Agreement.

Pursuant to the Supplemental Agreement, after contributing 20% of their respective portion of the total capital contribution by Fujian Sinco and Fuzhou Gaojia, they agreed that they shall contribute the remaining 80% of total capital contribution within twelve months from the date of establishment of Fuzhou Jiake as shown on the business license of Fuzhou Jiake, but shall not be paid later than the time for Fujian Jiake required to pay the second tranche of the Earnest Monies of RMB80 million (equivalent to HK$100 million) as stipulated in the Cooperation Agreement (the ‘‘Agreed Date’’).

It is intended that Fujian Sinco will pay the full amount of its share of the total capital contribution of Fujian Jiake immediately after the signing of the Articles of Fujian Jiake by both parties. On the other hand, Fuzhou Gaojia will contribute 20% of its respective portion of total capital contribution to Fujian Jiake within 15 days upon signing of the Articles of Fujian Jiake by both parties and the remaining portion by the Agreed Date. The aforesaid arrangement is concluded after arm’s length negotiations between the parties after taking into account of:

(i) Fuzhou Gaojia has incurred initial business development expenses for sourcing and initiating the Project, which could not be recharged by it;
(ii) the contribution from Fuzhou Gaojia to procure the Project;
(iii) Fujian Sinco is able to capitalize on Fuzhou Gaojia’s experience and expertise to participate in the real estate development business in Xi’an; and
(iv) Fujian Sinco is able to control the JV Companies by only contributing RMB110 million (equivalent to approximately HK$137.5 million) to Fujian Jiake under the existing arrangement, while Mr. Guo and the company(ies) controlled by him could not control the JV Companies despite they may be required to contribute an additional contribution of RMB208.25 million (equivalent to approximately HK$260.31 million) to the JV Company for acquiring the 49% interest in the JV Company, if Fujian Jiake cannot identify suitable investor by 31 July 2014 as mentioned in the paragraph below.

Upon establishment of Fujian Jiake, the financial results of Fujian Jiake will be consolidated into the consolidated financial statements of the Group and Fujian Jiake will be accounted for as a subsidiary of the Company. The investment of Fujian Sinco in Fujian Jiake will be funded by internal resources of the Group and/or bank borrowings.

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LETTER FROM THE BOARD

. Board composition of Fujian Jiake

Fujian Jiake will be managed by its board of directors, which will comprise five members, three of whom (including the chairman of the board of directors of Fujian Jiake) will be appointed by Fujian Sinco and two of whom will be appointed by Fuzhou Gaojia. Fuzhou Gaojia will have the right to nominate the general manager whom will be elected by the board of directors of Fujian Jiake.

. Profit sharing of Fujian Jiake

Fujian Sinco and Fuzhou Gaojia will share the profit and loss of Fujian Jiake in proportion to its respective capital contribution to Fujian Jiake.

. Matters required unanimous approval from the directors of Fujian Jiake

Fujian Jiake may not, without its directors’ unanimous written consent, to elect the Potential JV Partner.

. Pre-emptive rights

If either Fujian Sinco or Fuzhou Gaojia wishes to transfer any of its entitlement of the registered capital of Fujian Jiake to a third party, Fujian Sinco or Fuzhou Gaojia (as the case may be) will have a pre-emptive right to purchase such entitlement on the same terms and conditions being offered to the third party.

. Pledge of shareholding interests

Fujian Sinco and Fuzhou Gaojia will not, without the consent from another shareholder of the Fujian Jiake, create or permit to subsist any mortgage, pledge, lien or charge over all or any of its shareholding interests in Fujian Jiake.

The Cooperation Agreement involving the incorporation of a project company, the payment of the Earnest Monies and the Land Bidding

Upon establishment of Fujian Jiake, Fujian Jiake will enter into the Cooperation Agreement with the Reconstruction Office. Pursuant to the terms of the Cooperation Agreement, Fujian Jiake will, among other things, (i) establish a project company in 西安曲江新區 (Qujiang New District of Xi’an) with relevant 房地產開發資質 (Real Estate Development Qualification) to bid for the state-owned construction land use right of the Land; (ii) pay the Earnest Monies to the Reconstruction Office; (iii) procure the project company to pay the Bid Bond in accordance with the requirements of the Transfer Notice and (iv) procure the project company to settle the land consideration after winning in the Land Bidding.

. Incorporation of the project company

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LETTER FROM THE BOARD

Company, to bid for the state-owned construction land use right of the Land. As advised by the PRC Legal Adviser, according to the requirements of 房地產開發企業資質管理規定 (Real Estate Development Enterprise Qualification Regulations), an enterprise is not allowed to engage in the real estate development business without obtaining the relevant 房地產開發資質證書 (Real Estate Development Qualification Certificate). 房地產開發資質 (Real Estate Development Qualification*) is divided into First, Second, Third and Fourth Class and the Fourth Class is the lowest grade. The applicants are awarded different classes of qualification certificates by reference to criteria such as the size of their registered capital, prior experience in real estate development, the number of qualified and technical staff employed, the quality of their works, the implementation of proper quality assurance system and the safety standard.

In addition, according to the requirements of 陝西省房地產開發企業資質管理辦法 (Shaanxi Province Real Estate Development Qualification Management Approach), when an enterprise incorporated outside Shaanxi Province applies to set up a real estate development enterprise in Shaanxi Province, it is required to apply to 陝西省住房和城鄉建設廳 (Department of Housing and Urban Development of Shaanxi Province) for the provisional Real Estate Development Qualification Certificate. Such enterprise is also required to apply for the formal certificate after a certain period of time. In consideration that the Land will be developed into commercial complex with gross floor area of about 197,000 sq. m., the project company is required to apply for 房地產開發二級資質 (Real Property Development Qualification Certificate (Class 2)*), which allows the certificate holder to undertake projects with a gross floor area of less than 250,000 sq.m..

. Payment of the Earnest Monies

Immediately after signing the Cooperation Agreement, Fujian Jiake is required to pay the earnest monies in the aggregate amount of RMB200 million (equivalent to approximately HK$250 million) to the Reconstruction Office, of which (i) RMB120 million (equivalent to approximately HK$150 million) will be paid within 7 days upon signing the Cooperation Agreement and (ii) RMB80 million (equivalent to approximately HK$100 million) will be paid to the Reconstruction Office three months prior to the date of the Transfer Notice with an aim to demonstrate the capability and willingness of Fujian Jiake to participate in the Land Bidding to the Reconstruction Office. As advised by the PRC Legal Adviser, it is a normal practice for the Reconstruction Office to require the potential companies which are willing to participate in the land biddings to pay earnest monies. The Directors consider that it is in the interest of the Company to pay the Earnest Monies to the Reconstruction Office given that the Reconstruction Office will assist Fujian Jiake in the Land Bidding. As advised by the PRC Legal Adviser, the Reconstruction Office will inform Fujian Jiake about the payment date of the second tranche of the Earnest Monies in writing. Fujian Jiake will pay the Earnest Monies by its internal resources.

If Fujian Jiake fails to pay the first tranche of the Earnest Monies in the amount of RMB120 million (equivalent to approximately HK$150 million) in accordance with the timeframe as stipulated in the Cooperation Agreement, the Cooperation Agreement will be terminated.

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LETTER FROM THE BOARD

The Reconstruction Office agrees to refund the Earnest Monies to Fujian Jiake following the publication of the Transfer Notice and the project company’s participation in the Land Bidding. These Earnest Monies should be refunded to Fujian Jiake within 10 business days without interest following the project company’s participation in the Land Bidding. The Directors expect that the Fujian Jiake will apply the refunded the Earnest Monies to fund its share of the capital contribution to the JV Company. In addition, if the project company serves a written notice to renounce to enroll in the Land Bidding to the Reconstruction Office, the Reconstruction Office will refund the Earnest Monies to Fujian Jiake within three months from the date of such written notice.

In addition, both parties confirm that in the event that there are any changes in laws, regulations and policies, which cause the Reconstruction Office to be unable to fulfill its obligations under the Cooperation Agreement, the Reconstruction Office will refund the Earnest Monies without interest to Fujian Jiake and the Reconstruction Office will not be obliged to bear any adverse responsibilities.

As advised by the PRC legal adviser of the Company, pursuant to the terms of the Cooperation Agreement, Fujian Jiake can request the Reconstruction Office to refund the Earnest Monies in any circumstances.

. Land Bidding

As stipulated in the Cooperation Agreement, it is expected that 西安市新城區國土資源局 (The Bureau of Land and Resources of Xincheng District of Xi’an*) (the ‘‘Land Bureau’’) will publish the Transfer Notice prior to 31 October 2014. After negotiation, a target consideration of the Land of RMB400 million (equivalent to approximately HK$500 million) is determined with reference to the preliminary valuation of the Land. Mr. Guo, as the director of Fujian Sinco, Great Team Capital Investment Limited and Great Peace Global Group Limited, which are indirect wholly owned subsidiaries of the Company, is responsible for the negotiation with the Reconstruction Office. As advised by the PRC Legal Adviser, the final listing price of the Land (the ‘‘Listing Price’’) will be determined and promulgated by the Land Bureau with reference to the appraised value of the Land and the then government policies. In general, the listing price of the lands set by the Land Bureau are equal to or higher than the appraised value of the lands in Xi’an. When the project company participates in the Land Bidding, it is required to place the Bid Bond to the Land Bureau according to the requirements set out in the Transfer Notice.

Fujian Jiake also undertakes to the Reconstruction Office that under any circumstances, the final consideration of the Land paid by the project company will not be lower than the appraised value of the Land promulgated by the Land Bureau, which is the bottom price of the Land. If the Listing Price is higher than the Target Price, Fujian Jiake can opt (i) to procure the project company to continue to participate in the Land Bidding or (ii) withdraw from the cooperation. Fujian Jiake is required to serve a written notice to inform the Reconstruction Office its withdrawal from the Land Bidding prior to the publication of the Transfer Notice. Once received the written notice from Fujian Jiake,

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LETTER FROM THE BOARD

the Reconstruction Office will refund the Earnest Monies without interest within three months from such notice to Fujian Jiake. Otherwise, the Reconstruction Office will assume the project company to bid at the Listing Price.

In the event that Fujian Jiake fails to establish the project company with the relevant 房地產開發資質 (Real Estate Development Qualification*), Fujian Jiake is considered to withdraw from the cooperation. The Reconstruction Office will refund the Earnest Monies without interest to Fujian Jiake within three months after the closing of the Land Bidding.

In the event that the project company fails in the Land Bidding, the Reconstruction Office will coordinate with the Land Bureau to refund the Bid Bond without interest to the project company within one week. The Directors expect that Fujian Jiake will continue to pursue other property related business opportunities if the project company fails to bid for the Land.

The Company will comply with the requirements of the Listing Rules including seeking Shareholders’ approval and making announcement(s) regarding the detailed terms of the acquisition of the Land, such as the bid price of the Land, the payment of the Bid Bond and other terms of the acquisition prior to the Land Bidding as and when appropriate, if required by the Listing Rules. The Company will also announce the results of the Land Bidding including the final consideration of the Land after announcing the results of the Land Bidding by the Land Bureau.

Formation of the JV Company

Pursuant to the terms of the Fujian Jiake JV Agreement, following the establishment of Fujian Jiake, Fujian Sinco and Fuzhou Gaojia will use their best endeavors to procure Fujian Jiake to set up the JV Company in Xi’an, which will be owned as to 51% and 49% by Fujian Jiake and the Potential JV Partner respectively with a registered capital of RMB425 million (equivalent to approximately HK$531.25 million) for a term of 40 years. The JV Company will apply for the necessary qualifications, approvals and licenses to engage in real estate development and related business in the PRC and will be responsible for the development of the Project.

As at the Latest Practicable Date, the Company has not identified the Potential JV Partner. It is expected that the Potential JV Partner will be an Independent Third Party engaged in management of fund(s), which will not involve in the daily operation and management of the JV Company. The Company will issue further announcement(s) regarding, among the others, the identity and the principal business activities of the Potential JV Partner and further details on the JV Company upon the Company has identified the Potential JV Partner. In addition, Mr. Guo agrees that if Fujian Jiake is unable to identify the Potential JV Partner on or before 31 July 2014, he or company(ies) controlled by him will take up the 49% interest in the JV Company.

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LETTER FROM THE BOARD

The proposed principal terms of the joint venture agreement in relation to the JV Company to be entered by Fujian Jiake and the Potential JV Partner are as follows:

. Business scope of the JV Company

The business scope of the JV Company will include, among other things, investment, development, sale, lease, management of properties and other ancillary services in the PRC.

. Registered capital of the JV Company

The JV Company will be a limited company established in the PRC with a registered capital of RMB425 million (equivalent to approximately HK$531.25 million), which will be owned as to 51% and 49% by Fujian Jiake and the Potential JV Partner respectively. Fujian Jiake and the Potential JV Partner are expected to make a capital contribution in cash of RMB216.75 million (equivalent to approximately HK$270.94 million) and RMB208.25 million (equivalent to approximately HK$260.31 million) respectively to the registered capital of the JV Company, which represents the total capital commitment of Fijian Jiake and the Potential JV Partner to the JV Company.

Such capital contribution is estimated with reference to the estimated cost of the Project and the funding requirement of the JV Company. The total capital contribution of RMB425 million (equivalent to approximately HK$531.25 million) will be applied to satisfy part of the consideration of the Land and the construction and development cost of the Project.

Upon establishment of the JV Company, the financial results of the JV Company will be consolidated into the consolidated financial statements of the Group and the JV Company will be accounted for as a subsidiary of the Company. The investment of Fujian Jiake in the JV Company will be funded by its internal resources.

. Board composition of the JV Company

The JV Company will be managed by its board of directors, which will comprise five members, three of whom (including the chairman of the board of directors of the JV Company) will be appointed by Fujian Jiake and two of whom will be appointed by the Potential JV Partner. The Potential JV Partner will have the right to nominate the general manager whom will be elected by the board of directors of the JV Company.

. Profit sharing of the JV Company

Fujian Jiake and the Potential JV Partner will share the profit and loss of the JV Company in proportion to their respective capital contribution to the JV Company.

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LETTER FROM THE BOARD

Conditions of the Fujian Jiake JV Agreement

The completion of the Fujian Jiake JV Agreement is conditional upon fulfillment of the following conditions:

(i) the passing of the relevant resolution(s) by the Independent Shareholders at the SGM approving the Fujian Jiake JV Agreement and the transactions contemplated thereunder;
(ii) the establishment of Fujian Jiake having been completed and Fujian Jiake having obtained all relevant licenses and approvals from the governmental departments in the PRC; and
(iii) Fujian Sinco having obtained and having been satisfied with the legal opinion issued by a PRC legal adviser confirming the legality of matters in connection with the Fujian Jiake JV Agreement and the transactions contemplated thereunder.

In the event that the above conditions are not fulfilled on or before 31 March 2014 or such other date as may be agreed between the parties, the Fujian Jiake JV Agreement will forthwith be of no further effect, in which case all the obligations of the parties will be released and the parties will have no claims against each other in respect of the Fujian Jiake JV Agreement.

INFORMATION ABOUT THE LAND AND THE PROJECT

The Land is located at 西安曲江大明宮遺址區 (Xi’an Qujiang Daming Palace Heritage Area) in Xi’an, which is adjacent to the subway and railway stations and main roads. Xi’an Xianyang International Airport is situated at about 30 minutes’ driving distances from the Land. In 2007, Xi’an municipal government decided to launch 大明宮遺址區保護改造項目 (Daming Palace Heritage Area Protection And Reconstruction Project) to protect and restore the ruins of Daming Palace and its surrounding environment. The aforesaid project covered a total area of approximately 19.16 square kilometers to transform the nearby district into a new district with mixed-use development and to build the Daming Palace National Heritage Park, which has been opened in 2010. The total site area of the Land is approximately 40 mu (畝) and the approved purposes of the Land are for commercial use. The term of the land use rights of Land granted is 40 years.

The Target Price is estimated to be approximately RMB400 million (equivalent to approximately HK$500 million), which is estimated with reference to the preliminary estimation of the value of the Land of approximately RMB400 million (equivalent to approximately HK$500 million) as at 30 June 2013 prepared by an independent valuer (the ‘‘Preliminary Valuation’’) by comparison approach by making reference to comparable sales evidences as available in the relevant market and has also taken into account the construction costs that will be expended to complete the development of the Project so as to reflect the quality of the Project upon completion of development. The final consideration of the Land will be determined after a public bidding process. The Land is intended to be developed by the JV Company, into commercial complex with gross floor area of about 197,000 sq.m.. The Board considers that the Target Price is fair and reasonable having taken into account the

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LETTER FROM THE BOARD

Preliminary Valuation and the factors including current market conditions, the location, development costs and returns of the Project and development potential of the Land. The consideration of the Land is expected to be paid in tranches and in such amounts as stipulated in the relevant land grant contract. It is expected to be funded by the JV Company by its internal resources and/or bank borrowings.

In addition, the Group preliminary estimates that the total investment cost of the Project (inclusive the consideration of the Land) is approximately RMB1,200 million (equivalent to approximately HK$1,500 million), which will be financed by the internal resources of the JV Company and/or bank borrowings.

INFORMATION OF THE GROUP, FUZHOU GAOJIA AND THE RECONSTRUCTION OFFICE

The Group

The Group is principally engaged in tree plantation and management, manufacture and distribution of forestry products and holding of property for investment and rental purpose.

Fuzhou Gaojia

Fuzhou Gaojia is a company incorporated in the PRC in 1999 with its headquarter situated at Fuzhou, the PRC. To the best information, knowledge and belief of the Directors after making necessary enquiries, as at the Latest Practicable Date, Fuzhou Gaojia is owned as to approximately 96.51% and 3.49% by Guo Shi and Fujian Ai Jian. Guo Shi is owned as to 95% and 5% by Mr. Guo and Mr. Guo Dehai (郭德海), the father of Mr. Guo, respectively. Fujian Ai Jian is owned by the Independent Third Parties.

Fuzhou Gaojia has obtained 房地產開發二級資質 (Real Estate Development Qualification (Class 2)) from 福建省住房和城鄉建設廳 (Department of Housing and Urban Development of Fujian Province), which allows the certificate holder to undertake projects with a gross floor area less than 250,000 sq.m..

Fuzhou Gaojia has completed 楓丹白鷺 (Fontainebleau) and 凱旋楓丹 (Triumph Fontaine) real estate projects in Fuzhou, the PRC. In addition, in early 2013, Fuzhou Gaojia has legally obtained the state-owned land use right for a piece of land in 西安曲江 (Qujiang District of Xi’an*) and the aforesaid site will be developed by its wholly-owned subsidiary in Xi’an.

Reconstruction Office

To the best information, knowledge and belief of the Directors after making necessary enquiries, the Reconstruction Office is a legitimate institution established under 曲江新區管理委員會 (Xi’an Qujiang New District Management Committee), which is commissioned by the municipal government of Xi’an to take up the overall responsibility to manage 大明宮遺址區保護改造項目 (Daming Palace Heritage Area Protection And Reconstruction Project) and perform various duties on behalf of the municipal government of Xi’an in 西安市曲江新區 (Xi’an Qujiang New District*). As advised by the PRC Legal Adviser, the duties of the

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LETTER FROM THE BOARD

Reconstruction Office include land management and development and invitation of investments in connection with the Daming Palace Heritage Area. Hence, it is allowed to sign the agreements regarding land development and relevant investment projects related to the Daming Palace Heritage Area.

REASONS FOR AND BENEFITS OF ENTERING INTO THE FUJIAN JIAKE JV AGREEMENT

In 2012, the Group completed the acquisition of property investment business and has positioned property investment as its core business. The property investment business of the Group is mainly operated by Fujian Sinco, which is principally engaged in development, operation and management of a home improvement plaza in Taijiang, Fuzhou, the PRC. For the year ended 31 March 2013, the Group recorded rental income and property management and related fee income of approximately HK$118.6 million, representing approximately 99.99% of the total revenue of the Group. In view that the Group’s property investment business continuously bring a positive and stable return to the Group, the Board has been looking for suitable investment opportunities in the PRC property sector and targets to (i) diversify its scope of business to other property related business and (ii) extend its geographical reach to other provinces in the PRC so as to broaden its asset and earning base.

In addition, according to the statistics published by Xi’an Bureau of Statistics, during the first half of 2013, the total output value of Xi’an and its real estate industry have increased by approximately 10.9% and 24.2% respectively over the same period in 2012. According to the Master Plan of Xi’an proposed by the municipal government of Xi’an in 2005 for period from 2004 to 2020, it targeted to modernize the city gradually and make Xi’an become the best city, an important commercial center and an attractive tourist spot in western part of China, reaching an urbanization level of 80% by 2020. It expected that the population in the city center of Xi’an would increase from 4.5 million in 2003 to over 6 million in 2020 and the population of Xi’an from 7.8 million in 2003 to 10.0 million in 2020. The municipal government of Xi’an also planned to make significant investment to improve the external and internal public transportation systems of Xi’an. In consideration of the aforesaid, the Directors consider the Xi’an property market is growing with great potential.

With regard to cooperation with Fuzhou Gaojia and the Potential JV Partner, taking into account of the profile, experience and qualification of Fuzhou Gaojia in property development business, especially in Xi’an as set out in the above, the Directors believe that the Group would be able to capitalize on Fuzhou Gaojia’s experience, expertise and network in the property development and investment industry. In addition, by entering into the joint venture agreement with the Potential JV Partner, the Directors consider that the Potential JV Partner will provide funding for the development of the Project and the JV Company is able to leverage on the network and experience of the JV Partner to obtain further funding from the financial institution, if required.

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LETTER FROM THE BOARD

Accordingly, the Directors (including the independent non-executive Directors) consider that the entering into the transactions contemplated under the Fujian Jiake JV Agreement have been made on normal commercial terms and that such terms are fair and reasonable so far as the Company and the Shareholders are concerned and are in the interest of the Company and the Shareholders as a whole.

POSSIBLE FINANCIAL EFFECTS OF THE ENTERING INTO OF THE FUJIAN JIAKE JV AGREEMENT ON THE GROUP

Upon establishment of Fujian Jiake and the JV Company, the financial results of them will be consolidated into the consolidated financial statements of the Group and each of them will be accounted for as a 51% indirectly owned subsidiary of the Company. Fujian Sinco’s investment in Fujian Jiake will be funded by internal resources of the Group and/or bank borrowings. The Directors consider that the formation of the JV Companies pursuant to the Fujian Jiake JV Agreement will have no immediate material impact on the consolidated earnings or consolidated assets or liabilities of the Group.

IMPLICATIONS UNDER THE LISTING RULES

As one or more of the applicable percentage ratios in respect of the transactions contemplated under the Fujian Jiake JV Agreement including the formation of the JV Companies and the payment of the Earnest Monies are greater than 25% but are less than 100%, the entering into the Fujian Jiake JV Agreement constitute major transactions under the Listing Rules on the part of the Company and are subject to the Shareholders’ approval at the SGM.

In addition, as Fuzhou Gaojia is controlled by Mr. Guo, who is the single largest Shareholder of the Company (by virtue of his beneficial interest in approximately 29.11% of the existing issued share capital of the Company as at the Latest Practicable Date) and his associates, Fuzhou Gaojia is the connected person of the Company. Accordingly, the entering into the Fujian Jiake JV Agreement and the transactions contemplated thereunder also constitute connected transactions on the part of the Company, subject to the reporting, announcement and the independent shareholders’ approval requirements under Chapters 14 and 14A of the Listing Rules. Mr. Guo and his associates will abstain from voting in respect of the resolution(s) approving the Fujian Jiake JV Agreement and the transactions contemplated thereunder at the SGM. None of the Directors has a material interest in the transactions contemplated under the Fujian Jiake JV Agreement.

INDEPENDENT BOARD COMMITTEE AND INDEPENDENT FINANCIAL ADVISER

The Independent Board Committee comprising all the independent non-executive Directors, namely Dr. Wong Yun Kuen, Mr. Chan Chi Yuen, Mr. Yu Pak Yan, Peter, Mr. Zheng Jinyun and Mr. Zheng Yurui, has been established to advise the Independent Shareholders regarding the terms of the Fujian Jiake JV Agreement and the transactions contemplated thereunder. None of the members of the Independent Board Committee has a material interest in the Fujian Jiake JV Agreement and the transactions contemplated thereunder.

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LETTER FROM THE BOARD

Nuada has been appointed by the Company to advise the Independent Board Committee and the Independent Shareholders as to whether the terms of the Fujian Jiake JV Agreement and the transactions contemplated thereunder are fair and reasonable so far as the Independent Shareholders are concerned and are in the interests of the Company and the Shareholders as a whole.

SGM

The SGM will be held at 11:00 a.m. on Monday, 23 September 2013 at 3/F., Nexxus Building, 77 Des Voeux Road Central, Hong Kong, for the purpose of considering, and if thought fit, approving the Fujian Jiake JV Agreement and the transactions contemplated thereunder. The notice convening the SGM is set out on pages S-1 to S-2 of this circular and a form of proxy for use at the SGM is also enclosed with this circular.

To be valid, the enclosed form of proxy, together with any power of attorney or other authority under which it is signed must be completed in accordance with the instructions printed thereon and delivered to the Hong Kong share registrar and transfer office of the Company, Tricor Tengis Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the SGM or any adjourned meeting.

The completion and return of the form of proxy will not preclude you from attending and voting at the SGM or any adjourned meeting in person if you so wish and in such case, the form of proxy previously submitted by such member(s) shall be deemed to be revoked.

RECOMMENDATIONS

The Board believes that the Fujian Jiake JV Agreement and the transactions contemplated thereunder are all in the best interest of the Company and the Shareholders as a whole. Accordingly, the Board recommends that the Shareholders vote in favour of the resolution to be proposed at the SGM.

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this circular.

Yours faithfully, By order of the Board Chi Chi Hung Kenneth Executive Director and Company Secretary

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司

(formerly known as China Grand Forestry Green Resources Group Limited 前稱中國林大綠色資源集團有限公司) (incorporated in Bermuda with limited liability) (Stock code: 00910)

4 September 2013

To the Independent Shareholders,

Dear Sir or Madam,

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

We refer to the circular to the Shareholders dated 4 September 2013 (the ‘‘Circular’’) of which this letter forms part. Terms defined in the Circular shall have the same meanings when used herein unless the context otherwise requires.

We have been authorised by the Board to form the Independent Board Committee to advise the Independent Shareholders on whether the terms of the Fujian Jiake JV Agreement and transactions contemplated thereunder are on normal commercial terms, fair and reasonable and are in the interest of the Company and the Shareholders as a whole.

We wish to draw your attention to the letter from the Board set out in pages 5 to 17 of the Circular and the letter from Nuada, the independent financial adviser appointed to advise the Independent Board Committee and the Independent Shareholders in relation to the Fujian Jiake JV Agreement and the transactions contemplated thereunder, set out on pages 20 to 27 of the Circular.

Having considered the factors and reasons considered by and the opinion of Nuada stated in its letter of advice set out in the Circular, we are of the view that the terms of the Fujian Jiake JV Agreement and the transactions contemplated thereunder are on normal commercial terms, fair and reasonable and are in the interests of the Company and the Shareholders as a whole.

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Accordingly, we recommend the Independent Shareholders to vote in favour of the resolution to be proposed at the SGM to approve the Fujian Jiake JV Agreement and the transactions contemplated thereunder.

Yours faithfully, For and on behalf of Independent Board Committee

Dr. Wong Yun Kuen Mr. Chan Chi Yuen Mr. Yu Pak Yan, Peter Independent non-executive Independent non-executive Independent non-executive Director Director Director Mr. Zheng Jinyun Mr. Zheng Yurui Independent non-executive Independent non-executive Director Director

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LETTER FROM NUADA

The following is the full text of the letter of advice to the Independent Board Committee and Independent Shareholders from Nuada Limited dated 4 September 2013 prepared for incorporation in this circular.

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19th Floor, BLINK, 111 Bonham Strand Sheung Wan, Hong Kong 香港上環文咸東街111號 BLINK 19字樓

4 September 2013

To the Independent Board Committee and the Independent Shareholders of China Sandi Holdings Limited

Dear Sirs,

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

INTRODUCTION

We refer to our appointment as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in connection with entering of the Fujian Jiake JV Agreement, details of which are set out in the letter from the Board (the ‘‘Letter from the Board’’) contained in the circular of the Company to the Shareholders dated 4 September 2013 (the ‘‘Circular’’), of which this letter forms part. Capitalised terms used in this letter shall have the same meanings as defined in the Circular unless the context otherwise requires.

On 7 August 2013, Fujian Sinco, an indirectly wholly-owned subsidiary of the Company and Fuzhou Gaojia entered into the Fujian Jiake JV Agreement, pursuant to which, both parties have agreed (i) to establish Fujian Jiake and the JV Company to engage in investment, development, sale, lease, management of properties and other ancillary services in the PRC and (ii) to bid for and acquire the Land.

As (i) one or more of the applicable percentage ratios in respect of the transactions contemplated under the Fujian Jiake JV Agreement, including the formation of the JV Companies and the payment of the Earnest Monies, are greater than 25% but are less than 100%; and (ii) Fuzhou Gaojia is controlled by Mr. Guo, who is the single largest Shareholder of the Company and his associates, Fuzhou Gaojia is the connected person of the Company, accordingly, the entering into the Fujian Jiake JV Agreement constitute major and connected transactions for the Company and subject to the reporting, announcement and Independent

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LETTER FROM NUADA

Shareholders’ approval requirements under Chapter 14 and 14A of the Listing Rules. Mr. Guo and his associate will abstain from voting in respect of the resolutions approving the transactions contemplated under the Fujian Jiake JV Agreement at the SGM.

Voting at the SGM will be conducted by poll. An Independent Board Committee, comprising Dr. Wong Yun Kuen, Mr. Chan Chi Yuen, Mr. Yu Pak Yan, Peter, Mr. Zheng Jinyun and Mr. Zheng Yurui, has been established to advise the Independent Shareholders as to whether the terms of Fujian Jiake JV Agreement and the transactions contemplated thereunder are on normal commercial terms, fair and reasonable and are in the interests of the Company and the Shareholders as a whole. We, Nuada Limited, have been appointed by the Company to advise the Independent Board Committee and the Independent Shareholders in this respect.

BASIS OF OUR OPINION

In formulating our opinion and recommendations, we have relied on the accuracy of the information, opinions and representations contained or referred to in the Circular and provided to us by the Company, the management of the Company and the Directors. We have assumed that all information, opinions and representations contained or referred to in the Circular and all information, opinions and representations which have been provided by the Company, the management of the Company and the Directors, for which they are solely and wholly responsible, were true, accurate and complete at the time when they were made and continue to be so as at the date of the SGM.

Accordingly, we have no reason to suspect that any material facts or information have been withheld or to doubt the truth, accuracy and completeness of the information, opinions and representations contained in the Circular, or the reasonableness of the opinions expressed by the management of the Company and the Directors provided to us. The Directors collectively and individually accept full responsibility for the accuracy of the information in the Circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, opinions expressed in the Circular have been arrived at after due and careful consideration and there are no other facts the omission of which would make any statements in the Circular misleading. Furthermore, we relied on the Company that it has provided us sufficient information to reach an informed view and to provide a reasonable basis for our opinions. We have relied on such information and opinions but have not, however, conducted any independent in-depth investigation into the business, financial conditions and affairs or the future prospects of the Group nor have we considered the taxation implication on the Company or the Shareholders as a result of the entering into the Fujian Jiake JV Agreement.

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LETTER FROM NUADA

Principal Factors and Reasons Considered

In arriving at our advice with regard to fairness and reasonableness on the terms of the Fujian Jiake JV Agreement, we have taken into consideration the following factors and reasons:

1. Fujian Jiake JV Agreement

On 7 August 2013, Fujian Sinco, an indirectly wholly-owned subsidiary of the Company and Fuzhou Gaojia entered into the Fujian Jiake JV Agreement (as supplemented by the Supplemental Agreement dated 30 August 2013), pursuant to which, both parties have agreed (i) to establish Fujian Jiake and the JV Company to engage in investment, development, sale, lease, management of properties and other ancillary services in the PRC and (ii) to bid for and acquire the Land.

Formation of Fujian Jiake

Under the Fujian Jiake JV Agreement, Fujian Jiake will be established in the PRC for a term of 40 years. The business scope of Fujian Jiake will include, among other things, investment, development, sale, lease, management of properties and other ancillary services in the PRC.

According to the Letter from the Board, Fujian Sinco intended to pay the full amount of its share of the total capital contribution of Fujian Jiake immediately after the signing of the Articles of Fujian Jiake by both parties, on the other hand, Fuzhou Gaojia will contribute 20% of its respective portion of total capital contribution to Fujian Jiake within 15 days upon signing of the Articles of Fujian Jiake by both parties and the remaining portion by the Agreed Date. We concur with the Directors that such arrangement is fair and reasonable taking into account (i) Fuzhou Gaojia has incurred initial business development expenses for sourcing and initiating the Project, which according to the Directors, amounted to approximately HK$200,000, which could not be recharged by it; (ii) the contribution from Fuzhou Gaojia to procure the Project; (iii) Fujian Sinco is able to capitalize on Fuzhou Gaojia’s experience and expertise to participate in the property development business in Xi’an, background information of Fuzhou Gaojia has been provided in the subsection headed ‘‘Fuzhou Gaojia’’ under the section headed ‘‘Information of the Group, Fuzhou Gaojia and the Reconstruction Office’’ of the Letter from the Board;

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LETTER FROM NUADA

and (iv) Fujian Sinco is able to control the JV Companies by only contributing RMB110 million (equivalent to approximately HK$137.5 million) to Fujian Jiake under the existing arrangement, while Mr. Guo and the company(ies) controlled by him could not control the JV Companies despite they may be required to contribute an additional contribution of up to RMB208.25 million (equivalent to approximately HK$260.31 million) to the JV Company for acquiring the 49% interest in the JV Company, if Fujian Jiake cannot identify suitable investor by 31 July 2014.

We have reviewed all the other terms of the Fujian Jiake JV Agreement in respect of the formation of Fujian Jiake and are not aware of any terms which are unfair and unreasonable to the Company. Taken into account (i) Fujian Jiake will be managed by its board of directors, which will comprise five members, three of whom (including the chairman of the board of directors of Fujian Jiake) will be appointed by Fujian Sinco; (ii) Fujian Sinco will have a pre-emptive right to purchase the entitlement of the registered capital of Fujian Jiake on the same terms and conditions if Fuzhou Gaojia wishes to transfer such entitlement to a third party; and (iii) Fujian Sinco and Fuzhou Gaojia will not, without the consent from another shareholder of the Fujian Jiake, create or permit to subsist any mortgage, pledge, lien or charge over all or any of its shareholding interests in Fujian Jiake, we are of the view that these terms of the Fujian Jiake JV Agreement could secure the Company’s control over Fujian Jiake and are favour to the Company. Accordingly, we are of the view and concur with the view of the Directors that the terms of Fujian Jiake JV Agreement in respect of the formation of Fujian Jiake are in the interests of the Company and so far as the Independent Shareholders are concerned. Please refer to the section headed ‘‘The Fujian Jiake JV Agreement’’ in the Letter from the Board for the details of such agreement.

The Cooperation Agreement

Upon establishment of Fujian Jiake, Fujian Jiake will enter into the Cooperation Agreement with the Reconstruction Office. Pursuant to the terms of the Cooperation Agreement, Fujian Jiake will, among other things, (i) establish a project company in 西安曲江新區 (Qujiang New District of Xi’an) with relevant 房地產開發資質 (Real Estate Development Qualification) to bid for the state-owned construction land use right of the Land; (ii) pay Earnest Monies to the Reconstruction Office; (iii) procure the aforesaid project company to pay the Bid Bond in accordance with the requirements of the Transfer Notice and (iv) procure the aforesaid project company to settle the land consideration after winning in the Land Bidding.

(i) Incorporation of the project company

According to the Cooperation Agreement, Fujian Jiake is required to establish a project company in 西安曲江新區 (Qujiang New District of Xi’an) with relevant 房地產開發資質 (Real Estate Development Qualification), which is expected to be the JV Company, to bid for the state-owned construction land use right of the Land. According to our study of the PRC legal opinion, we understand that it is a normal business process to set up a project company to comply with all the requirements of

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relevant authorised parties of the PRC government, details of which are set in the sub-section headed ‘‘Incorporation of the project company’’ under the section headed ‘‘The Cooperation Agreement involving the incorporation of a project company, the payment of the Earnest Monies and the Land Bidding’’ in the Letter from the Board.

(ii) Payment of the Earnest Monies

Immediately after signing the Cooperation Agreement, Fujian Jiake is required to pay earnest monies in the aggregate amount of RMB200 million (equivalent to approximately HK$250 million) to the Reconstruction Office, of which (i) RMB120 million (equivalent to approximately HK$150 million) will be paid within 7 days upon signing the Cooperation Agreement and (ii) RMB80 million (equivalent to approximately HK$100 million) will be paid to the Reconstruction Office three months prior to the date of the Transfer Notice. As advised by the PRC Legal Adviser of the Company and according to the Cooperation Agreement, the purpose for paying the Earnest Monies is demonstrating the capability and willingness of the applicant to participate in the Land Bidding toward the Reconstruction Office. The same amount of the Earnest Monies will be refunded to Fujian Jiake within 10 business days without interest upon the participation of the project company in the Land Bidding.

Shareholders should note that as the Earnest Monies will finally refund to Fujian Jiake without any interest, therefore we consider it incurs opportunity costs to the Company. With reference to the website of People Bank of China, the statutory saving rate as at Latest Practicable Date was 3% per annum, the Earnest Monies could properly generate approximately HK$30.75 million interest income per annum to the Company, which we consider it as an implicit cost to be risen from the Earnest Monies. And such interest cost depends on the maturity of the Earnest Monies which would not be latter than 31 October 2014, being the last date of publication of the Transfer Notice according to the Company. According to the management of the Company and the PRC Legal Adviser and our review on the PRC legal opinion, as it is a normal practice for the Reconstruction Office to require the potential companies which are willing to participate in the Land Bidding, to pay the Earnest Monies. In order to assess whether the payment of Earnest Monies is a normal practice in the PRC, we asked the Company and Mr. Guo to provide some other executed cooperation agreements signed with government authorities in the PRC. We obtained and reviewed 4 other executed cooperation agreements which are signed in between 2011 and 2012 and noted that the payment of earnest monies is specifically required in the aforesaid executed cooperation agreements. Based on the above, we are of the view that the payment of the Earnest Monies are normal practice and reasonable term to the Company. Please refer to the sub-section headed ‘‘Payment of the Earnest Monies’’ under the section headed ‘‘The Cooperation Agreement involving the incorporation of a project company, the payment of the Earnest Monies and the Land Bidding’’ in the Letter from the Board for the details.

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(iii) Land Bidding

As advised by the Company, Fijian Jiake will apply the refunded Earnest Monies to fund its share of the capital contribution to the JV Company for the Bid Bond to the Land Bureau according to the requirements set out in the Transfer Notice. As the Transfer Notice has not yet been published, the amount of the Bid Bond remains unknown as at the Latest Practicable Date. According to the Letter from the Board, the Company will comply with the requirements of the Listing Rules including seeking Shareholders’ approval and making announcement(s) regarding the detailed terms of the acquisition of the Land, such as the bid price of the Land, the payment of the Bid Bond and other terms of the acquisition prior to the Land Bidding as and when appropriate, if required by the Listing Rules. The Company will also announce the results of the Land Bidding including the final consideration of the Land after announcing the results of the Land Bidding by the Land Bureau. Please refer to the Letter from the Board for more information about the Land Bidding.

Formation of the JV Company

We have reviewed all the other terms of the Fujian Jiake JV Agreement in respect of the formation of the JV Company and are not aware of any terms which are unfair and unreasonable to the Company.

Further information about the JV Company are set out in the section headed ‘‘Formation of the JV Company’’ in the Letter from the Board.

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LETTER FROM NUADA

As shown in our analysis on (i) formation of Fujian Jiake; (ii) the cooperation agreement; and (iii) formation of the JV Company, we concur with the Directors’ view that the terms of the Fujian Jiake JV Agreement are fair and reasonable and in the interests of the Company and the Shareholder as a whole.

2. Reasons and benefits for the entering into the Fujian Jiake JV Agreement

The Group is principally engaged in tree plantation and management, manufacture and distribution of forestry products and holding of property for investment and rental purpose.

We have reviewed the financial statement of the Company for the year ended 31 March 2013 and noted that the Group recorded the rental income of approximately HK$43.7 million and property management and related fee income of approximately HK$75 million. Such turnover in aggregate represents about 99.99% of the total revenue of the Group for the year ended 31 March 2013 and is mainly contributed by Fujian Sinco, which is principally engaged in development, operation and management of a home improvement plaza in Taijian, Fuzhou, the PRC. As such, we consider the Group has relevant property investment experience in the PRC.

According to the information obtained from the website of Xi’an Bureau of Statistics, the regional gross domestic product (the “RGDP”) increased from approximately RMB219 billion in 2008 to approximately RMB437 billion in 2012, representing an increase of approximately 100% during the aforesaid period.

Furthermore, the amount of investments in property development sector in Xian, increased from approximately RMB54 billion in 2008 to approximately RMB128 billion in 2012, representing an increase of approximately 137% during the aforesaid period. Based on the above, we concur with the view of the Directors that property market in Xi’an is growing with great potential.

Given that the RGDP, which represents the purchasing power of households in Xi’an, has been increased significantly in the past few years, we believe that the demand for the property in Xi’an could be sustainable.

In light of (i) the purpose of the entering into the Fujian Jiake JV Agreement is Land Bidding which is the ordinary business of the Group; (ii) both Fujian Sinco and Fuzhou Gaojia have qualified experiences in the property investment business in the PRC, particularly, Fuzhou Gaojia has completed 楓丹白鷺 (Fontainebleau) and 凱旋楓丹 (Triumph Fontaine) real estate projects in Fuzhou, the PRC; (iii) the Group could extend its geographical reach to other provinces in the PRC; and (iv) the prospect of property market in Xi’an remains positive, which are discussed in the section headed ‘‘Reasons for and benefits of entering into the Fujian Jiake JV Agreement’’ in the Letter from the Board and the recent development of property market in Xi’an as stated above, accordingly, we concur with the view of the Directors that the entering into the Fujian Jiake JV Agreement is in the interest of the Company and the Shareholders as a whole.

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LETTER FROM NUADA

Possible financial effects of the entering into the Fujian Jiake JV Agreement on the Group

Upon establishment of Fujian Jiake and the JV Company, the financial results of them will be consolidated into the consolidated financial statements of the Group and they will be accounted for as a 51% indirectly owned subsidiary of the Company. Fujian Sinco’s investment in Fujian Jiake will be funded by internal resources of the Group and/ or bank borrowings. The Directors consider that the formation of the JV Companies pursuant to the Fujian Jiake JV Agreement will have no immediate material impact on the consolidated earnings or consolidated assets or liabilities of the Group.

RECOMMENDATION

Having taken into account the above principal factors and reasons, we consider that the terms of the Fujian Jiake Agreement are on normal commercial terms and fair and reasonable and the entering into the Fujian Jiake Agreement is in the interests of the Group and the Shareholders as a whole. Accordingly, we recommend (i) the Independent Board Committee to advise the Independent Shareholders; and (ii) the Independent Shareholders, to vote in favor of the relevant resolution(s) at the SGM to approve the Fujian Jiake Agreement and the transactions contemplated thereunder.

Yours faithfully, For and on behalf of Nuada Limited

Kevin Chan Director

Kevin Wong Vice President

– 27 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. FINANCIAL INFORMATION OF THE GROUP

The financial information of the Group (i) for the year ended 31 March 2013 has been disclosed on pages 34 to 120 of the annual report of the Company for the year ended 31 March 2013; (ii) for the year ended 31 March 2012 has been disclosed on pages 32 to 112 of the annual report of the Company for the year ended 31 March 2012; and (iii) for the year ended 31 March 2011 has been disclosed on pages 30 to 92 of the annual report of the Company for the year ended 31 March 2011. All the above reports of the Company have been published on the website of the Stock Exchange (http://www.hkexnews.hk) and the website of the Company (http://www.chinasandi.com.hk/).

2. INDEBTEDNESS

As at the close of business on 31 July 2013, being the latest practicable date for ascertaining the indebtedness of the Group prior to the printing of this circular, the Group had outstanding bank borrowings of approximately HK$783,750,000, which were secured by a subsidiary’s investment property with carrying value of approximately HK$3,786,122,000. Moreover, among these bank borrowings, there was a bank loan of approximately HK$183,750,000 which has been personally guaranteed by Mr. Guo. Besides, the Group had outstanding borrowing from a third party of approximately HK$60,600,000 which was guaranteed by Mr. Guo and a company controlled by him. In addition, the Group had zero coupon convertible notes in the principal amount of HK$461,676,000, which can be converted into Shares at an initial conversion price of HK$3 per conversion share (subject to adjustments) at any time during the period commencing from the date of issuance of the convertible notes.

Save as aforesaid and apart from intra-group liabilities, as at the close of business on 31 July 2013, the Group did not have other outstanding mortgages, charges, debentures or other loan capital, bank overdrafts or loans, other similar indebtedness, finance lease or hire purchase commitments, liabilities under acceptance or acceptance credits, guarantees or other material contingent liabilities.

3. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 March 2013, the date on which the latest published audited consolidated financial statements of the Company were made up.

4. WORKING CAPITAL

The Directors, after due and careful enquiry, are of the opinion that taking into account of the financial resources available to the Group including internally generated funds and the available banking facilities and in the absence of unforeseen circumstances, the Group will have sufficient working capital for its present requirements, that is for at least the next twelve months from the date of this circular.

– I-1 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

5. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

For the year ended 31 March 2013, the Group recorded revenue of approximately HK$118.7 million (2012: HK$23.9 million), representing an increase of approximately 397% in compared with that of the previous year. The increase in revenue of the Group was mainly attributable to the post-acquisition revenue generated from the newly acquired property business. The Group recorded profit for the year of approximately HK$155.6 million, representing basic earnings per Share of HK14 cents. The profit was mainly attributable to the increase in revenue, the gain arising from changes in fair value less costs to sell of biological assets of approximately HK$166.2 million, the net gain on financial assets at fair value through profit or loss of approximately HK$76.3 million and fair value gain on investment property of approximately HK$52.0 million.

The Directors consider that its property investment business provides valuable opportunity for the Group to diversify its business and broaden its asset and earning base. Looking forward, in view of the performance of its property investment sector, the Directors position such business as the core business of the Group and expect that it will continue to contribute profit and bring benefits to the Group. By way of setting up the JV Companies, the Directors expect that the Group will be able to (i) diversify its scope of business to other property related business and (ii) extend its geographical reach to other provinces in the PRC so as to broaden its asset and earning base.

On the other side regarding the Group’s traditional ecological forestry business, the running costs of traditional resources business kept rising. The granting of harvesting permit was very limited, and therefore the revenue generated from the Group’s ecological forestry business has been declining. The Directors are considering to dispose it by various means including public tendering.

On 18 June 2013 and 25 June 2013, the Company has entered into a non-legally binding letter of intent and a supplemental letter of intent respectively with a potential purchaser for the possible disposal of the entire forestry business operations. Currently, the potential purchaser is carrying out due diligence review on the disposed companies of the Group and as at the Latest Practicable Date, no formal sale and purchase agreement was entered by the Group.

– I-2 –

GENERAL INFORMATION

APPENDIX II

1. RESPONSIBILITY OF THE DIRECTORS

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DISCLOSURE OF INTERESTS

Directors and chief executives interests or short position in the Shares or short position in Shares and underlying Shares

As at the Latest Practicable Date, none of the Directors and chief executives of the Company or their associates had any interest or short position in the shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO as recorded in the register required to be maintained under section 352 of the SFO or as otherwise notified to the Company or the Stock Exchange pursuant to the Model Code for Securities transaction by Directors of Listed Companies.

3. INTERESTS AND SHORT POSITIONS OF SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, according to the register kept by the Company pursuant to section 336 of SFO and so far as is known to the Directors or chief executive of the Company, the following persons (other than the Directors and the chief executive of the Company) had or were deemed or taken to have interests or short positions in the Shares or underlying shares (including any interests in options in respect of such capital), which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO:

				Approximate
		Number of shares		% of existing
		or underlying shares		issued share
	Capacity/	Long	Short	capital in the
Name of Shareholder	Nature of Interest	position	position	Company
Mr. Guo (Note 1)	Interest of Controlled	200,000,000	—	29.11%
	Corporation
United Century International	Beneficial Owner	200,000,000	—	29.11%
Limited (Note 2)
Mrs. Chu Yuet Wah (Note 3)	Interest of Controlled	42,500,000	—	6.19%
	Corporation
Best China Limited (Note 4)	Beneficial Owner	42,500,000	—	6.19%

– II-1 –

GENERAL INFORMATION

APPENDIX II

Notes:

The beneficial interests of Mr. Guo in 200,000,000 Shares comprise corporate interest in 200,000,000 Shares, held through United Century International Limited.
The entire issued share capital of United Century International Limited is beneficially owned by Mr. Guo.
The beneficial interests of Mrs. Chu Yuet Wah in 42,500,000 Shares comprise corporate interest in 42,500,000 Shares, held through Best China Limited.
The entire issued share capital of Best China Limited is beneficially owned by Mrs. Chu Yuet Wah.

Save as disclosed above, as at the Latest Practicable Date, the Directors and the chief executive of the Company were not aware of any other person (other than the Directors and the chief executive of the Company) who had, or was deemed to have, interests or short positions in the Shares or underlying Shares which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO.

4. DIRECTORS’ INTEREST IN ASSETS AND/OR ARRANGEMENT

As at the Latest Practicable Date, there was no contract or arrangement subsisting in which any Director was materially interested and which was significant in relation to the business of the Group. As at the Latest Practicable Date, none of the Directors had any direct or indirect interest in any assets which have been, since 31 March 2013 (being the date to which the latest published audited financial statements of the Group were made up), (i) acquired or disposed of by; or (ii) leased to; or (iii) proposed to be acquired or disposed of by; or (iv) proposed to be leased to, any member of the Group.

As at the Latest Practicable Date, none of the Directors or proposed Directors, directly or indirectly, had any interest in any assets which had since 31 March 2013 (being the date to which the latest published audited financial statements of the Group were made up) been acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

5. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had a service contract with the Company which was not determinable by the Company within one year without payment of compensation, other than statutory compensation.

6. COMPETING INTERESTS

As at the Latest Practicable Date, so far as the Directors are aware of, none of the Directors, proposed directors or any of their respective associates had any interest in business which competes with or may compete with the business of the Group or had any other conflict of interests which any person has or may have with the Group.

– II-2 –

GENERAL INFORMATION

APPENDIX II

7. LITIGATION

As at the Latest Practicable Date, neither the Company nor any of its subsidiaries is engaged in any litigation or arbitration of material importance and no litigation or claim of material importance is known to the Directors to be pending or threatened by or against the Company or any of its subsidiaries.

8. MATERIAL CONTRACTS

The following contracts (not being contracts entered into in the ordinary course of business) have been entered into by any member of the Group within the two years immediately preceding the date of this circular that are or may be material:

(a) on 30 September 2011, a supplemental agreement was entered into among Top Trendy Holdings Limited, Grand Supreme Limited, Mr. Guo as the guarantor and the Company to supplement or amend certain terms and conditions of the share transfer agreement dated 26 July 2011;
(b) on 30 September 2011, a share transfer agreement was entered into by the Company, Grand Supreme Limited, a wholly owned subsidiary of the Company, as the purchaser and Good Fellow Resources Holdings Limited as the seller for the purpose of acquisition of the entire share capital and loan of Great Peace Global Group Limited;
(c) the letter of intent entered into by the Company and an independent third party on 18 June 2013 for the purpose of negotiation with the Company and conduct due diligence review in relation to the possible disposal of Success Standard Investment Limited;
(d) the letter of intent referred in (c) above was supplemented by the supplemental letter of intent entered into by the Company and the independent third party on 25 June 2013 to extend the due diligence review to six months; and
(e) the Fujian Jiake JV Agreement and the Supplemental Agreement entered into between Fujian Sinco and Fuzhou Gaojia.

– II-3 –

GENERAL INFORMATION

APPENDIX II

9. EXPERTS AND CONSENTS

The following are the names and qualifications of the experts who have given their opinions and advice which are included in this circular:

Name Qualification

Dominic K.F. Chan & Co.

Certified Public Accountants to provide the comfort letter to confirm the sufficiency of working capital of the Group and to review the indebtedness statement contained in Appendix I of this circular

Nuada Limited

a corporation licensed under the SFO to carry out type 6 (advising on corporate finance) regulated activity

As at the Latest Practicable Date, none of the above experts had any shareholding, directly or indirectly, in any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

As at the Latest Practicable Date, none of the above experts had any interest, direct or indirect, in the promotion of, or in any assets which since 31 March 2013, the date to which the latest published audited financial statements of the Group were made up, have been acquired or disposed of by or leased to, any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group.

Each of the above experts has given and has not withdrawn its written consent to the issue of this circular, with the inclusion of the references to its name and/or its opinion or report in the form and context in which they are included.

10. MISCELLANEOUS

(a) The registered office of the Company is at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda and the head of office and principal place of business of the Company is at Unit 3309, 33/F., West Tower, Shun Tak Centre,168–200 Connaught Road Central, Sheung Wan, Hong Kong.
(b) The branch share registrar and transfer office in Hong Kong is Tricor Tengis Limited, at 26th Floor, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong.
(c) The company secretary is Mr. Chi Chi Hung Kenneth. Mr. Chi is a fellow member of the Association of Chartered Certified Accountants in the United Kingdom, an associate member of the Hong Kong Institute of Certified Public Accountants, an associated member of the Hong Kong Institute of Chartered Secretaries and an associate member of the Institute of Chartered Secretaries and Administrators in the United Kingdom.

– II-4 –

GENERAL INFORMATION

APPENDIX II

(d) In the event of consistency, the English texts of this circular shall prevail their respective Chinese texts.

11. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection during normal business hours on any weekday (except Saturdays and public holidays) at the head office and principal place of business of the Company in Hong Kong at Unit 3309, 33/F., West Tower, Shun Tak Centre,168–200 Connaught Road Central, Sheung Wan, Hong Kong, from the date of this circular, up to and including the date of the SGM:

(a) the memorandum of association and bye-laws of the Company;
(b) the letter from the Independent Board Committee, the text of which is set out on pages 18 to 19 of this circular;
(c) the letter of advice from Nuada, the text of which is set out on pages 20 to 27 of this circular;
(d) the written consents referred to in paragraph headed ‘‘Experts and Consents’’ of this appendix;
(e) the annual report of the Company for the two year ended 31 March 2012 and 31 March 2013 respectively;
(f) the material contracts referred to in the paragraph headed ‘‘Material contracts’’ to this appendix; and
(g) this circular.

– II-5 –

NOTICE OF SGM

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司

(formerly known as China Grand Forestry Green Resources Group Limited 前稱中國林大綠色資源集團有限公司) (incorporated in Bermuda with limited liability) (Stock code: 00910)

NOTICE IS HEREBY GIVEN that the special general meeting of China Sandi Holdings Limited (the ‘‘Company’’) will be held at 3/F., Nexxus Building, 77 Des Voeux Road Central, Hong Kong at 11:00 a.m. on Monday, 23 September 2013 for the purpose of considering and, if thought fit, passing, with or without modification, the following resolutions:

ORDINARY RESOLUTION

‘‘THAT:

the Fujian Jiake JV Agreement and Supplemental Agreement, defined and described in the circular of the Company dated 4 September 2013 (the ‘‘Circular’’), a copy of the Fujian Jiake JV Agreement marked ‘‘A’’, a copy of the Supplemental Agreement marked ‘‘B’’ together with a copy of the Circular marked ‘‘C’’ being tabled before the meeting and initialed by the chairman of the meeting for identification purpose, and all transactions contemplated thereunder and in connection therewith, be and are hereby approved, ratified and confirmed; and any one director of the Company be and is hereby authorized for and on behalf of the Company to execute all such other documents and agreements and to do all such acts or things deemed by him to be incidental to, ancillary to or in connection with the matters contemplated under the Fujian Jiake JV Agreement.’’

By Order of the board of China Sandi Holdings Limited Chi Chi Hung Kenneth

Executive Director and Company Secretary

Hong Kong, 4 September 2013

Registered Office: Principal Place of Business in Hong Kong: Clarendon House Room 3309 2 Church Street 33rd Floor, West Tower Hamilton HM11 Shun Tak Centre Bermuda 168–200 Connaught Road Central Hong Kong

– S-1 –

NOTICE OF SGM

Notes:

A member entitled to attend and vote at the meeting convened by the above notice is entitled to appoint one or more proxy to attend and, on a poll, subject to the provisions of the bye-laws of the Company, vote in his stead. A proxy need not be a member of the Company.
In order to be valid, the form of proxy must be deposited together with a power of attorney or other authority, if any, under which it is signed or a notarially certified copy of that power or authority, at the office of the Company’s Hong Kong branch registrar, Tricor Tengis Limited, at 26th Floor, Tesbury Centre, No. 28 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time for holding the meeting or any adjourned meeting thereof.

– S-2 –

AI assistant

C&D Property Management Group Co., Ltd — Proxy Solicitation & Information Statement 2013

50406_rns_2013-09-03_8ef14780-53a4-4ac8-a89e-7a4fbfff59d9.pdf

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

CHINA SANDI HOLDINGS LIMITED 中 國 三 迪 控 股 有 限 公 司

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

CONTENTS

DEFINITIONS

DEFINITIONS

DEFINITIONS

CHINA SANDI HOLDINGS LIMITED 中 國 三 迪 控 股 有 限 公 司

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

INTRODUCTION

LETTER FROM THE BOARD

THE FUJIAN JIAKE JV AGREEMENT

Formation of Fujian Jiake

. Business scope of Fujian Jiake

LETTER FROM THE BOARD

. Profit sharing of Fujian Jiake

The Cooperation Agreement involving the incorporation of a project company, the payment of the Earnest Monies and the Land Bidding

. Payment of the Earnest Monies

. Land Bidding

Formation of the JV Company

. Business scope of the JV Company

. Profit sharing of the JV Company

Conditions of the Fujian Jiake JV Agreement

INFORMATION ABOUT THE LAND AND THE PROJECT

LETTER FROM THE BOARD

INFORMATION OF THE GROUP, FUZHOU GAOJIA AND THE RECONSTRUCTION OFFICE

The Group

Fuzhou Gaojia

Reconstruction Office

REASONS FOR AND BENEFITS OF ENTERING INTO THE FUJIAN JIAKE JV AGREEMENT

POSSIBLE FINANCIAL EFFECTS OF THE ENTERING INTO OF THE FUJIAN JIAKE JV AGREEMENT ON THE GROUP

IMPLICATIONS UNDER THE LISTING RULES

INDEPENDENT BOARD COMMITTEE AND INDEPENDENT FINANCIAL ADVISER

LETTER FROM THE BOARD

SGM

RECOMMENDATIONS

ADDITIONAL INFORMATION

CHINA SANDI HOLDINGS LIMITED 中 國 三 迪 控 股 有 限 公 司

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

Yours faithfully, For and on behalf of Independent Board Committee

LETTER FROM NUADA

MAJOR AND CONNECTED TRANSACTIONS: FORMATION OF JOINT VENTURE COMPANIES AND PAYMENT OF THE EARNEST MONIES FOR BIDDING OF THE LAND

INTRODUCTION

LETTER FROM NUADA

BASIS OF OUR OPINION

Principal Factors and Reasons Considered

1. Fujian Jiake JV Agreement

Formation of Fujian Jiake

LETTER FROM NUADA

The Cooperation Agreement

(i) Incorporation of the project company

(ii) Payment of the Earnest Monies

(iii) Land Bidding

Formation of the JV Company

2. Reasons and benefits for the entering into the Fujian Jiake JV Agreement

RECOMMENDATION

1. FINANCIAL INFORMATION OF THE GROUP

2. INDEBTEDNESS

3. MATERIAL ADVERSE CHANGE

4. WORKING CAPITAL

5. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

1. RESPONSIBILITY OF THE DIRECTORS

2. DISCLOSURE OF INTERESTS

Directors and chief executives interests or short position in the Shares or short position in Shares and underlying Shares

3. INTERESTS AND SHORT POSITIONS OF SUBSTANTIAL SHAREHOLDERS

4. DIRECTORS’ INTEREST IN ASSETS AND/OR ARRANGEMENT

5. SERVICE CONTRACTS

6. COMPETING INTERESTS

7. LITIGATION

8. MATERIAL CONTRACTS

9. EXPERTS AND CONSENTS

Name Qualification

10. MISCELLANEOUS

11. DOCUMENTS AVAILABLE FOR INSPECTION

CHINA SANDI HOLDINGS LIMITED 中 國 三 迪 控 股 有 限 公 司

ORDINARY RESOLUTION

‘‘THAT:

C&D Property Management Group Co., Ltd Proxy Solicitation & Information Statement 2013

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司

CHINA SANDI HOLDINGS LIMITED 中國三迪控股有限公司