CMON Limited — Capital/Financing Update 2011

May 23, 2011

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

瀋陽公用發展股份有限公司 Shenyang Public Utility Holdings Company Limited

(a joint stock limited company incorporated in the People’s Republic of China)

(Stock code: 747)

MAJOR DISPOSAL

Financial Adviser to the Company

Karl Thomson Financial Advisory Limited

The Board is pleased to announce that on 23 May 2011, after the trading hours, the Company entered into the Disposal Agreement with the Purchaser, whereby the Purchaser has conditionally agreed to purchase and the Company has conditionally agreed to sell the Disposal Company at the consideration of RMB81 million.

As the Disposal constitutes a major disposal of the Company pursuant to the Listing Rules, the Disposal is subject to the Shareholders’ approval at the EGM.

A circular containing, amongst other things, further details of the Disposal, the financial information of the Group, other general information of the Company and the notice of the EGM will be dispatched to the Shareholders on or before 14 June 2011.

THE DISPOSAL AGREEMENT

Date: 23 May 2011

Parties:

Vendor: The Company Purchaser: Beijing Sihai Huaao Trading Company Limited* (北京四海華澳貿易 有限公司)

The Purchaser is a limited company incorporated in the PRC and principally engaged in trading of consumer products, building materials and machineries.

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To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, the Purchaser and its ultimate beneficial owner(s) are Independent Third Parties as defined under the Listing Rules.

Consideration

Pursuant to the Disposal Agreement, the Consideration for the Disposal is RMB81 million. The Consideration was arrived at after arm’s length negotiations among the parties to the Disposal Agreement with reference to the audited net asset value of the Disposal Group and the value of the Property.

The Consideration shall be satisfied in the following manners:-

• (a) a refundable deposit of RMB30 million shall be paid by the Purchaser in seven days upon entering into the Disposal Agreement; and

• (b) the balance of RMB51 million shall be paid in cash by the Purchaser to the Company in six months upon signing the Disposal Agreement.

Asset to be disposed of

Pursuant to the Disposal Agreement, the Company has conditionally agreed to sell and the Purchaser has conditionally agreed to acquire the entire issued share capital of the Disposal Company and a shareholder’s loan due from the Disposal Company to the Company. The Disposal Company, through its wholly-owned subsidiary namely Shenzhen Optoelectronic, holds a property located in Keyuan Road East, Jingsi Road West, South Avenue of High-tech Industrial Park, Nanshan District, Shenzhen, the PRC, with a gross floor area of approximately 12,508 square meters. The Property currently generates monthly rental income to the Company through leases under various tenancies.

Conditions precedent

Completion of the Disposal Agreement is conditional upon satisfaction of all of the following conditions:

1. The Disposal being approved by the Board;

2. The Disposal being approved by the Shareholders at the EGM;

3. The Disposal Company completes the procedures of change of registered shareholder and the business registration certificate records the Sale Shares being held by the Purchaser; and

4. The Consideration being fully paid by the Purchaser.

Completion

Completion shall take place within six months upon the fulfillment of the conditions precedent to the Disposal Agreement or such other date as the Company and Purchaser may agree in writing.

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INFORMATION OF THE GROUP AND THE DISPOSAL COMPANY

As at the date of this announcement, the Group is principally engaged in property development and educational investment in the PRC.

Set out below summaries the consolidated financial information of the Disposal Group for the two years ended 31 December 2009 and 2010:

		**For the year **	ended
		31 December
		2010	2009
		(audited)	(audited)
		RMB	RMB
Revenue		9,175,142	10,108,600
Profit/(loss)	before taxation and extraordinary items	(4,042,993)	3,466,018
Profit/(loss)	after taxation and extraordinary items	(3,915,808)	2,800,946

As of 31 December 2010, the net asset value of the Disposal Group is RMB80,690,670.

GAIN ON THE DISPOSAL

Based on the audited net asset value of the Disposal Group amounted to RMB80,690,670 as at 31 December 2010, there is a gain of RMB309,330 from the Disposal based on the amount of the Consideration.

The Group tends to utilize all the net proceeds from the Disposal for future business development of the remaining Group.

REASONS FOR THE DISPOSAL

As announced in the Acquisition Announcement in details, the Company has already identified an investment opportunities with potential higher return to enhance the value of the Company and its shareholders. In light of such opportunity, the management proposed to cash in the investment in the Disposal Company such that more liquid capitals will be in hand for the development of the project as mentioned in the Acquisition Announcement and for future investment opportunities.

The Directors (including the independent non-executive Directors) are of the view that the Disposal is in the interest of the Company and the terms and conditions of the Disposal Agreement are on normal commercial terms, which are fair and reasonable and are in the interests of the Company and the Shareholders as a whole.

LISTING RULES IMPLICATION OF THE DISPOSAL

As certain applicable percentage ratios under Rule 14.07 of the Listing Rules in respect of the Disposal exceed 25% but less than 75%, the Disposal constitutes a major disposal of the Company under the Listing Rules. Accordingly, the Disposal is subject to the Shareholders’ approval by way of poll at the EGM.

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A circular containing, amongst other things, further details of the Disposal, the financial information of the Group, other general information of the Company and the notice of the EGM will be dispatched to the Shareholders on or before 14 June 2011.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following expressions shall have the following respective meanings.

“Acquisition Announcement”	a major acquisition proposed and announced by the
	Company on 11 May 2011
“Company”	Shenyang Public Utility Holdings Company Limited
“Completion”	the completion of the Disposal
“connected person”	has the meaning ascribed to it in the Listing Rules
“Consideration”	consideration of the Disposal amounted to RMB81 million
“Disposal”	the disposal of the Disposal Company by the Company to
	the Purchaser pursuant to the Disposal Agreement
“Disposal Agreement”	the sale and purchase agreement dated 23 May 2011 entered
	into between the Company and the Purchaser in relation to
	the Disposal
“Disposal Company”	Shenzhen Jade Bird Shenfa Guangdian Company Limited*
	(深圳青鳥瀋發光電有限公司)
“Disposal Group”	the Disposal Company and its subsidiaries
“Director(s)”	means the directors of the Company
“EGM”	an extraordinary general meeting of the Company to be
	convened and held to approve the Disposal, the Disposal
	Agreement and the transactions contemplated thereunder
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the
	People’s Republic of China
“Independent Third	the independent third party(ies) who is/are, to the best of the
Party(ies)”	Directors’ knowledge, information and belief having made
	all reasonable enquiry, independent of the Company and its
	connected persons (as defined under the Listing Rules)

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“H-Share(s)”	ordinary share(s) of RMB1 each in the share capital of the
	Company
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange
“PRC”	the People’s Republic of China
“Property”	Beida Jade Bird Building in Shenzhen, the PRC, being the
	asset of Shenzhen Optoelectronic
“Purchaser”	Beijing Sihai Huaao Trading Company Limited* (北京四海
	華澳貿易有限公司)
“Sale Shares”	the shares of the Disposal Company pursuant to the Disposal
	Agreement, being the entire issued share capital of the
	Disposal Company
“Shareholder(s)”	holder(s) of the H-Shares
“Shenzhen Optoelectronic”	Shenzhen Jade Bird Optoelectronic Co., Ltd.* (深圳青鳥光
	電有限公司), a wholly-owned subsidiary of the Disposal
	Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“RMB”	Renminbi, the lawful currency of the PRC
“%”	per cent.

By Order of the Board Shenyang Public Utility Holdings Company Limited An Mu Zong Chairman

Shenyang, PRC, 23 May 2011

As at the date of this announcement, the executive directors of the Company are Mr. An Mu Zong, Mr. Wang Zai Xing, Mr. Alex Chow Ka Wo and Mr. Wang Hui, the non executive directors are Mr. Lin Dong Hui and Mr. Bao Yi Qiang and the independent non-executive directors are Mr. Cai Lian Jun, Mr. Wong Kai Tat and Mr. Chan Ming Sun Jonathan.

* For identification purpose only

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