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DT Capital Limited Proxy Solicitation & Information Statement 2003
49154_rns_2003-11-21_4f3b1df8-66a4-481c-b57e-ed68e344d56e.pdf
Proxy Solicitation & Information Statement
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THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION
If you are in any doubt about this circular or as to the action to be taken, you should consult a stockbroker, bank manager, solicitor, professional accountant or other professional adviser.
If you have sold or transferred all your shares in Interchina Holdings Company Limited, you should at once hand this circular with the enclosed form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser or transferee.
The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.
國中控股有限公司
INTERCHINA HOLDINGS COMPANY LIMITED
(Incorporated in Hong Kong with limited liability)
DISCLOSEABLE TRANSACTION
18 November 2003
CONTENTS
Page
Responsibility Statement ... ii
Definitions ... 1
Letter from the Board
Introduction ... 3
The Agreement ... 4
Information on the Company ... 6
Further Information ... 6
Appendix - General Information ... 7
- i -
RESPONSIBILITY STATEMENT
This document includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this document and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief there are no other facts the omission of which would make any statement herein misleading.
- ii -
DEFINITIONS
In this circular, unless the context otherwise requires, the following expressions shall have the following meanings:
"Agreement"
an agreement made between the Company and Xianyang Government on 27 October 2003 pursuant to which Xianyang Government agreed to grant to the WOFE an exclusive right to invest, finance, design, construct and operate the Water Treatment Plant Project
"Board"
the board of Directors
"Company"
Interchina Holdings Company Limited, a company incorporated in Hong Kong with limited liability, the shares of which are listed on the Stock Exchange
"Directors"
the executive directors of the Company
"Group"
the Company and its subsidiaries
"HK$"
Hong Kong dollars
"Hong Kong"
the Hong Kong Special Administrative Region of the PRC
"Listing Rules"
The Rules Governing the Listing of Securities on the Stock Exchange
"PRC"
the People's Republic of China, excluding Hong Kong for the purpose of this circular
"RMB"
Renminbi, the lawful currency of the PRC
"Shareholders"
holders of Shares
"Shares"
ordinary shares of HK$0.1 each in the capital of the Company
"Stock Exchange"
The Stock Exchange of Hong Kong Limited
- 1 -
DEFINITIONS
"Water Treatment Plant Project"
a water treatment plant project in Shaanxi Province, Xianyang City, involving, among others, the investment, financing, design, construction and operation of a water treatment plant to be participated by the Company through the establishment of the WFOE as the project company pursuant to the Agreement
"WFOE"
a wholly foreign owned enterprise to be established by the Company in the PRC as the project company to participate in the Water Treatment Plant Project pursuant to the Agreement
"Xianyang Government"
陕西省咸陽市人民政府 (the People's Government of Shaanxi Province Xianyang City)
"%"
per cent.
(Conversion of RMB to HK$ is based on the exchange rate of RMB1.06 = HK$1)
- 2 -
LETTER FROM THE BOARD
國中控股有限公司
INTERCHINA HOLDINGS COMPANY LIMITED
(Incorporated in Hong Kong with limited liability)
Executive Directors:
Mr. Zhang Yang (Chairman)
Mr. Chan Wing Yuen, Hubert
Mr. Zhang Jiyei Jack
Mr. Lam Cheung Shing, Richard
Registered Office:
45th Floor
Far East Finance Centre
16 Harcourt Road
Admiralty
Hong Kong
Non-executive Directors:
Mr. Hui Ho Ming, Herbert
Independent Non-executive Directors:
Mr. Lee Peng Fei, Allen
Mr. Wu Wai Chung, Michael
Mr. Wong Hon Sum
Ms. Ha Ping
18 November 2003
To the Shareholders
Dear Sir or Madam,
DISCLOSABLE TRANSACTION
INTRODUCTION
It was announced on 29 October 2003 that the Company has entered into the Agreement with Xianyang Government on 27 October 2003, under which Xianyang Government agreed to grant to the Company an exclusive right to invest, finance, design, construct and operate the Water Treatment Plant Project through the WFOE.
Pursuant to the terms of the Agreement, the Company will establish the WOFE to take up the rights and obligations of the Company under the Agreement. It was proposed that the WOFE will be established with a registered capital of not more than RMB60,000,000 (equivalent to approximately HK$56,603,770) and the total investment of not more than RMB200,000,000 (equivalent to approximately HK$188,679,240).
LETTER FROM THE BOARD
The Agreement constitutes a discloseable transaction of the Company under the Listing Rules. The purpose of this circular is to provide the Shareholders with further information of the Agreement.
THE AGREEMENT
Date
27 October 2003
Parties
Party A : Xianyang Government, which is not a connected person (as defined in the Listing Rules) to the Company
Party B : the Company
Subject of investment
Under the Agreement, Xianyang Government agreed to grant to the Company an exclusive right to invest, finance, design, construct and operate the Water Treatment Plant Project through the WOFE for a period of 30 years (which may be extended for a further term of 20 years if no material breach have been committed during the initial term).
Pursuant to the Agreement, the Company will purchase natural water from supplier(s) designated by Xianyang Government and sell the processed water to purchaser(s) designated by Xianyang Government. Xianyang Government will procure that the Company will be allocated the land necessary for the construction of the water treatment plant. Xianyang Government will also procure purchases from the water treatment plant for the three years immediately after commencement of its operation of no less than 60%, 70% and 80% respectively of its maximum projected capacity, (i.e. 300,000 tons per day) and the purchases for the year of 2010 of no less than 100% of its maximum projected capacity. It is agreed by the parties to the Agreement that the maximum projected capacity of the water treatment plant in full operation shall be 300,000 tons per day.
The water treatment plant shall be completed within 2 years after all the relevant permits and approvals for commencement of construction have been obtained, such permits and approvals will be applied for after the establishment of the WOFE and the completion of the design drawings for the water treatment plant. As at the Latest Practicable Date, the Company considers it is premature to estimate when such permits and approvals can be obtained.
LETTER FROM THE BOARD
The total investment of the Company under the Agreement shall not exceed RMB200,000,000 (equivalent to approximately HK$188,679,240) and will be made by the Company by way of capital injection/investment into the WFOE. The total amount of investment has been agreed upon after arm's length discussion between the parties to the Agreement, taking into account the projected capacity of the water treatment plant.
The Agreement does not expressly provide for any condition precedent for the coming into effect of the Agreement. Under a term sheet between the Company and Xianyang Government dated 15 August 2003 in relation to the Water Treatment Plant Project, it is contemplated by the Company and Xianyang Government that the obligations of the Company under the Agreement is subject to the execution of the following agreements:
i. network building and transfer agreement, pursuant to which the WOFE will design, construct and transfer to Xianyang Government a necessary water passage system and network for the Water Treatment Plant Project at a price to be agreed between the parties;
ii. water supply agreement in relation to the pricing scheme, quality and quantity of the water processed by the water treatment plant;
iii. natural water supply agreement in relation to the pricing scheme, quality and quantity of the natural water supplied to the water treatment plant for processing; and
iv. service agreement between the Company or the WFOE and an authorized governmental institution, pursuant to which the authorized governmental institution shall be responsible for and guarantee the due and punctual payment by the purchaser(s) of the processed water supplied by the water treatment plant.
A further announcement will be made as and when appropriate upon the execution of the above agreements in accordance with the Listing Rules. However, no long-stop date for the execution of the above agreements has been agreed between the Company and Xianyang Government.
Establishment of the WFOE
Pursuant to the terms of the Agreement, the Company will establish the WFOE as the project company to take up the rights and obligations of the Company under the Agreement and participate in the Water Treatment Plant Project. It is proposed that the WFOE will be established for an initial term of 30 years commencing from the date of issue of its business licence with a registered capital of not more than RMB60,000,000 (equivalent to approximately HK$56,603,770) and the total investment of not more than RMB200,000,000 (equivalent to approximately HK$188,679,240). The WFOE will be wholly owned by the Company.
LETTER FROM THE BOARD
The contribution to be made by the Company to the registered capital of the WFOE will be funded from the internal resources of the Company.
It is contemplated by the Company and Xianyang Government that the business scope of the WFOE, subject to the approval of the PRC government, shall be to invest, finance, design, construct and operate a water treatment plant and engage in water supply and other related business activities in the PRC.
As at the Latest Practicable Date, the WOFE has not yet been established. The Directors are in the process of preparing the requisite establishment documents for submission to the relevant approval authorities in the PRC.
INFORMATION ON THE COMPANY
The Group is principally engaged in the investment in environmental and water treatment operation and city development and investment operation as well as property investment and development in Hong Kong and the mainland, the PRC. The investment in the Water Treatment Plant Project allow the Company to further extend its investment in water supply and water treatment projects and to take leverage on tremendous opportunities in the PRC's cities development and urbanization in order to achieve the Group's short term and medium term profit growth.
The Directors further believe that the PRC economy boom will continue for the next ten years and major urbanization works will be the ultimate driving force for the economy. The Group's business plans and goals are based on this belief and are aligned with PRC's economic development direction. The Directors considers the terms of the investment to the Water Treatment Project to be fair and reasonable to the Shareholders and are in the best interest of the Group.
FURTHER INFORMATION
Your attention is drawn to the additional information set out in the Appendix.
Yours faithfully,
On behalf of the Board
Interchina Holdings Company Limited
Yip Kar Hang, Raymond
Company Secretary
- 6 -
APPENDIX
GENERAL INFORMATION
1. RESPONSIBILITY STATEMENT
This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquires, that to the best of their knowledge and belief, there are no other facts the omission of which would make any statement herein misleading.
2. DIRECTORS' INTERESTS IN SECURITIES
As at the Latest Practicable Date, the interests or short positions of the Directors or chief executives of the Company in the shares, underlying shares and debentures of the Company or any associated corporation (within the meaning of Part XV of the Securities and Futures Ordinance) which require notification to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the Securities and Futures Ordinance (including interests or short positions which any such Director or chief executive is taken or deemed to have under such provision of the Securities and Futures Ordinance) or which are required pursuant to Sections 352 of Securities and Futures Ordinance to be entered into the register maintained by the Company under Section 352 of Securities and Futures Ordinance or which are required, pursuant to the Model Code for Securities Transactions by Directors of Listed Companies, to be notified to the Company and the Stock Exchange were as follows:
| Name of Directors | Nature of interests | Number of Shares |
|---|---|---|
| Zhang Yang | Corporate | 1,612,025,000 (Note) |
| Zhang Jiyei Jack | Personal | 5,000 |
Note : The ordinary shares were held through Wealth Land Development Corp., a company beneficially and wholly owned by Mr. Zhang Yang.
As at the Latest Practicable Date, the following Directors had interests in respect of options granted under the share option scheme adopted by the Company on 25 July 2000:
| Name of Directors | Date of grant | Exercise Price (HK$) | Exercisable Period | Number of Share Options outstanding |
|---|---|---|---|---|
| Zhang Yang | 29 March 2001 | 0.161 | From 01 April 2001 to 31 March 2005 | 109,000,000 |
APPENDIX
GENERAL INFORMATION
Save as disclosed above, none of the Directors or chief executives of the Company have, as at the Latest Practicable Date, any interests or short positions in the shares, underlying shares and debentures of the Company or any associated corporation (within the meaning of Part XV of the Securities and Futures Ordinance) which require notification to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the Securities and Futures Ordinance (including interests or short positions which any such Director or chief executive is taken or deemed to have under such provision of the Securities and Futures Ordinance) or which are required pursuant to Sections 352 of Securities and Futures Ordinance to be entered into the register maintained by the Company under Section 352 of Securities and Futures Ordinance or which are required, pursuant to the Model Code for Securities Transactions by Directors of Listed Companies, to be notified to the Company and the Stock Exchange.
3. DIRECTORS’ INTERESTS IN CONTRACTS
None of the directors is materially interested in any contract or arrangement entered into by any member of the Group subsisting at the date of this circular and which is significant in relation to the business of the Group.
4. SUBSTANTIAL SHAREHOLDERS
As at the Latest Practicable Date, so far as is known to the Directors or chief executive of the Company, the Shareholder, other than a Director or chief executive of the Company, who has an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under provisions of Division 2 and 3 of Part XV of the Securities and Futures Ordinance, or, who is, directly or indirectly, interested in ten per cent. or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group and the amount of each of such person’s interest in such securities or in any options in respect of such capital were:
| Name | Number of Shares | Percentage of holding |
|---|---|---|
| Wealth Land Development Corp. (Note) | 1,612,025,000 | 35.08% |
Note: Wealth Land Development Corp. is wholly owned by Mr. Zhang Yang, a Director.
5. DIRECTORS’ INTERESTS IN ASSETS
None of the directors has or has had any direct or indirect material interest in any assets which 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 since 31 March 2003, being the date to which the latest published audited financial statements of the Company were made up.
APPENDIX
GENERAL INFORMATION
6. SERVICE CONTRACT
There is no service contract between any proposed Directors and members of the Group which does not expire or is not determinable by the employer within one year without payment of compensation other than statutory compensation.
7. LITIGATION
No member of the Group is engaged in any litigation or arbitration of material importance and the Directors are not aware of any litigation or claims of material importance pending or threatened against any member of the Group.
8. MATERIAL CHANGES
Save as disclosed in the annual report to Shareholders for the financial year ended 31 March 2003, the Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 March 2003, being the date to which the latest published audited financial statements of the Company were made up.
9. MISCELLANEOUS
(a) The registered office of the Company is at 45th Floor, Far East Finance Centre, 16 Harcourt Road, Admiralty, Hong Kong.
(b) The Share Registrars is Tengis Limited at Ground Floor, BEA Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong.
(c) The secretary of the Company is Mr. Yip Kar Hang, Raymond, who is a member of the American Institute of Certified Public Accountants and the Hong Kong Society of Accountants.
(d) The English text of this circular shall prevail over the Chinese text.