CMON Limited — Capital/Financing Update 2015

Jul 31, 2015

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)

DISCLOSEABLE TRANSACTION INVOLVING SUBSCRIPTION OF SHARES

THE SUBSCRIPTION

On 31 July 2015 (after trading hours), the Subscriber, being a wholly-owned subsidiary of the Company and the Issuer entered into the Share Subscription Agreement, pursuant to which the Issuer has conditionally agreed to issue, and the Subscriber has conditionally agreed to subscribe 11,250,000 Subscription Shares at the consideration of RMB50 million (including RMB11.25 million as payment for the new registered capital and RMB38.75 million as payment for the share premium). The Subscription Shares represent approximately 5.00% of the issued share capital of the Issuer as at the date of the Share Subscription Agreement and approximately 4.35% of the enlarged issued share capital of the Issuer.

LISTING RULES IMPLICATIONS

As one of the percentage ratios under the Listing Rules in respect of the Share Subscription is more than 5% but less than 25%, the Share Subscription constitutes a discloseable transaction for the Company and is subject to notification and announcement requirements of Chapter 14 of the Listing Rules.

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THE SHARE SUBSCRIPTION AGREEMENT

Date

31 July 2015

Parties

Subscriber:

Shenzhen Shi Cheng He Chuang Jian Investment and Development Company Limited* 深圳市城合創建投資發展有限公司, a limited company incorporated under the laws of the PRC and a wholly-owned subsidiary of the Company

Issuer:

Wuhan Yi Da Construction Services Shares Company Limited* 武漢翼 達建設服務股份有限公司, a joint stock limited company incorporated under the laws of the PRC

To the best of the Directors’ knowledge, information and belief and having made all reasonable enquiries, the Issuer and its ultimate beneficial owner(s) is/are third party(ies) independent of the Company and its connected persons (as defined in Chapter 14A of the Listing Rules).

Subscription Shares

Pursuant to the Share Subscription Agreement, the Issuer has conditionally agreed to issue, and the Subscriber has conditionally agreed to subscribe 11,250,000 Subscription Shares at the consideration of RMB50 million (including RMB11.25 million as payment for the new registered capital and RMB38.75 million as payment for the share premium). The Subscription Shares represent approximately 5.00% of the issued share capital of the Issuer as at the date of the Share Subscription Agreement and approximately 4.35% of the enlarged issued share capital of the Issuer.

The Subscription Shares, when issued and fully paid up, shall rank pari passu in all respects with all other shares of the Issuer then in issue and in particular, will rank in full for all dividends and other distributions declared, made or paid at any time on or after the date of issue of the Subscription Shares.

Consideration

The consideration for the Subscription Shares of RMB50 million shall be paid by the Subscriber in cash within 5 Business Days upon the signing of the Share Subscription Agreement.

The consideration was determined by Issuer and the Subscriber after arm’s length negotiations and after taking into consideration of the net assets value of the Issuer’s group as at 31 December 2014 as well as the financial performance and the future prospects of the Issuer. The consideration will be satisfied by internal resources of the Group.

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Completion

Completion of the Share Subscription shall take place upon:

• i. the Consideration of the Share Subscription having been settled by the Subscriber to the Issuer within 5 Business Days upon the signing of the Share Subscription Agreement;

• ii. the capital verification procedures being duly completed;

• iii. the procedures of change in industry and commercial registration (工商登記) of the Issuer having completed.

INFORMATION ON THE ISSUER

The Issuer is a joint stock limited company established under the laws of the PRC with principal businesses including tower crane rental, concrete logistics, concrete pumping and technical engineering training and services. The registered capital of the Issuer will be increased from RMB225 million to RMB258.75 million by RMB33.75 million of which RMB11.25 million will be contributed by the Subscriber.

According to the latest audited financial statements, the audited net asset value of the Issuer’s group as of 31 December 2014 was approximately RMB573,244,000. The audited net profit before and after taxation and extraordinary items of the Issuer’s group for each of the two years ended 31 December 2013 and 2014 are set out below:

	For the year ended 31 December	For the year ended 31 December
	2014	2013
	(RMB)	(RMB)
Net profit before taxation and extraordinary items	78,103,309	90,441,976
Net profit after taxation and extraordinary items	58,385,719	68,210,158

REASONS FOR AND BENEFITS OF THE SHARE SUBSCRIPTION

As at the date of this announcement, the Group is principally engaged in infrastructure and construction business in the PRC. The Issuer is one of the leading enterprises among the construction and machinery services industry in the PRC. In order to accommodate its expansion plan, the Issuer proposed to increase its registered capital to obtain sufficiency funding for its future business development.

The Directors aim to seek investment opportunities to maximise the return to the Shareholders. As disclosed in the above section, the business of the Issuer is profit marking and according to the audited financial statements, the return on equity ratio for the year ended 31 December 2014 was approximately 10.18%. The Directors believe that the Share Subscription would enable the Group to participate in a well-established company relating to construction business and to capture future potential capital gain.

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Taking into account the benefits of the Share Subscription, the Directors are of the view that the Share Subscription is in the interest of the Group and the terms and conditions of the Share Subscription 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 IMPLICATIONS

As one of the percentage ratios under the Listing Rules in respect of the Share Subscription is more than 5% but less than 25%, the Share Subscription constitutes a discloseable transaction for the Company and is subject to notification and announcement requirements of Chapter 14 of the Listing Rules.

DEFINITIONS

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

“Board	the board of Directors
“Business Days”	a day (excluding statutory holidays) on which banks in the
	PRC are generally open for business
“Company”	Shenyang Public Utility Holdings Company Limited
“Completion”	the completion of the Share Subscription in accordance with
	the terms thereof
“Connected person(s)”	has the same meaning ascribed to it in the Listing Rules
“Consideration”	the consideration of RMB50,000,000 for the Subscription
	Shares payable by the Subscriber to the Issuer pursuant to
	the Share Subscription Agreement
“Director(s)”	means the directors of the Company
“Domestic Share(s)”	domestic share(s) with a nominal value of RMB1 each in the
	share capital of the Company which are subscribed for in
	RMB
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the
	People’s Republic of China
“H-Share(s)”	overseas listed foreign ordinary share(s) in share capital of
	the Company, with a nominal value of RMB1 each, all of
	which are listed on the main board of the Stock Exchange,
	and subscribed for and traded in Hong Kong dollars

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“Issuer” Wuhan Yi Da Construction Services Shares Company Limited 武漢翼達建設服務股份有限公司, a joint stock limited company incorporated under the laws of the PRC “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange “PRC” the People’s Republic of China “Share Subscription” the subscription of the Subscription Shares of the Issuer pursuant to the Share Subscription Agreement “Share Subscription the share subscription agreement dated 31 July 2015 made Agreement” between the Issuer and the Subscriber in relation to the Share Subscription “Share(s)” H-Share(s) and Domestic Share(s) “Shareholder(s)” holder(s) of the Shares “Stock Exchange” The Stock Exchange of Hong Kong Limited “Subscriber” Shenzhen Shi Cheng He Chuang Jian Investment and Development Company Limited 深圳市城合創建投資發展 有限公司, a limited company incorporated under the laws of the PRC and a wholly-owned subsidiary of the Company “Subscription Shares” the 11,250,000 shares of the Issuer to be allotted and issued by the Issuer to the Subscriber pursuant to the Share Subscription Agreement “RMB” Renminbi, the lawful currency of the PRC “%” per cent

By Order of the Board Shenyang Public Utility Holdings Company Limited Zhang Jing Ming Chairman

Shenyang, the PRC, 31 July 2015

As at the date of this announcement, the executive directors of the Company are Mr. Zhang Jing Ming, Mr. Deng Xiao Gang and Mr. Huang Zhen Kun, the non-executive directors are Mr. Yin Zong Chen and Ms. Li Yu Xiang and the independent non-executive directors are Mr. Chan Ming Sun Jonathan, Mr. He Qing Jia and Mr. Yu Guan Jian.

• For identification purposes only

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