Dufu Liquor Group Limited — Proxy Solicitation & Information Statement 2016

Sep 21, 2016

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 you should take, you should consult your licensed securities dealer or registered institution in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all of your shares in China Environmental Energy Investment Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee, or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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 Environmental Energy Investment Limited

(Incorporated in Bermuda with limited liability)

(Stock Code: 986)

MAJOR TRANSACTION ACQUISITION OF SECURITIES OF LUEN WONG GROUP HOLDINGS LIMITED; AND

MAJOR TRANSACTION AGGREGATE DISPOSAL OF SECURITIES OF CHINA JICHENG HOLDINGS LIMITED; AND

GRANTING OF MANDATE FOR POSSIBLE DISPOSAL OF EQUITY INTEREST IN CHINA JICHENG HOLDINGS LIMITED, WLS HOLDINGS LIMITED, LUEN WONG GROUP HOLDINGS LIMITED, AND GREATERCHINA PROFESSIONAL SERVICES LIMITED; AND NOTICE OF SPECIAL GENERAL MEETING

Capitalised terms used in this cover page shall have the same meaning as those defined in this circular.

A notice convening the SGM to be held on 11 October 2016 at 10:00 a.m. at Falcon Room I, Gloucester Luk Kwok Hong Kong, 72 Gloucester Road, Wanchai, Hong Kong is set out on pages 31 to 35 of this circular. A form of proxy for use at the SGM is enclosed with this circular. Such form of proxy is also published on the websites of the Stock Exchange (www. hkexnews.hk) and the Company (www.986.com.hk).

Whether or not you are able to attend the SGM, please complete and sign the accompanying form of proxy in accordance with the instructions printed thereon and return it to the branch share registrar of the Company in Hong Kong, Tricor Tengis Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, 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 adjournment thereof. Completion and return of the form of proxy will not preclude shareholders from attending and voting in person at the meeting if they so wish and, in such event, the form of proxy shall be deemed to be revoked.

22 September 2016

• For identification purposes only

CONTENT

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Appendix I – Financial Information of the Group. . . . . . . . . . . . . . . . . . . . . . . . . . . .	17
Appendix II – Unaudited Pro Forma Financial Information of
the Group upon Completion of the Luen Wong Acquisition. . . . . . .	19
Appendix III – General information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	26
Notice of Special General Meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	31

– i –

DEFINITIONS

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

“Announcement” the announcement dated 18 August 2016 issued by the Company relating to the Luen Wong Acquisition, CJH Disposal, the Possible CJH Disposal, the Possible WLS Disposal, the Possible Luen Wong Disposal and the Possible GPSL Disposal

“associate(s)”

has the same meaning ascribed to it under the Listing Rules

“Board”

the board of Directors

• “Business Day(s)”

a day (other than a Saturday, Sunday or public holiday in Hong Kong) on which commercial banks are generally open for business in Hong Kong

“CJH” China Jicheng Holdings Limited, a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Main Board of the Stock Exchange (stock code: 1027)

“CJH Disposal”

the disposal by the Company of a total of 817,030,000 CJH Shares on the market on 20 July 2016 and 21 July 2016 for a total consideration of HK$176,269,580

• “CJH Share(s)”

• ordinary share(s) with a nominal value of HK$0.00008 each in the share capital of CJH

• “Company”

China Environmental Energy Investment Limited（中國 環保能源投資有限公司* ）, a company incorporated in Bermuda whose shares are listed on the Stock Exchange

• “connected person(s)”

has the meaning ascribed to it under the Listing Rules

• “Director(s)”

director(s) of the Company

• “Disposable CJH Share(s)”

up to 578,470,000 CJH Shares owned by the Group

• “Disposable GPSL Share(s)”

up to 52,945,000 GPSL Shares owned by the Group

• “Disposable Luen Wong Share(s)”

up to 17,840,000 Luen Wong Shares owned by the Group

• “Disposable WLS Share(s)”

up to 524,010,000 WLS Shares owned by the Group

• “GPSL”

GreaterChina Professional Services Limited, a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Growth Enterprise Market of the Stock Exchange (stock code: 8193)

• For identification purposes only

– 1 –

DEFINITIONS

• “GPSL Share(s)”

• ordinary share(s) with a nominal value of HK$0.01 each in the share capital of GPSL

• “Group”

the Company and its subsidiaries

• “HK$”

Hong Kong dollar, the lawful currency of Hong Kong

• “Hong Kong”

• the Hong Kong Special Administrative Region of the People’s Republic of China

• “Independent Shareholders”

• Shareholders other than those who have material interest in the SPA and the transactions contemplated thereunder and are required to abstain from voting at the SGM

• “Independent Third Party(ies)”

• a party(ies) who is independent of and not connected with the Company and its connected persons

• “Latest Practicable Date”

• 14 September 2016, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained in this circular;

• “Listing Rules”

• the Rules Governing the Listing of Securities on the Stock Exchange

• “Luen Wong” Luen Wong Group Holdings Limited, a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Growth Enterprise Market of the Stock Exchange (stock code: 8217)

• “Luen Wong Acquisition”

the acquisition by the Company of a total of 17,840,000 Luen Wong Shares on the market on 20 July 2016 for a total consideration of HK$124,465,800

• “Luen Wong Share(s)”

• ordinary share(s) with a nominal value of HK$0.01 each in the share capital of Luen Wong

• “Possible CJH Disposal”

• the possible disposal of the Disposable CJH Shares for the period from the date on which the disposal is approved by the Shareholders to 21 July 2017, being the date falling on 12 months from 21 July 2016, the date of last disposal of CJH Shares by the Company

• “Possible Disposals”

• the Possible CJH Disposal, the Possible WLS Disposal, the Possible Luen Wong Disposal and the Possible GPSL Disposal

• “Possible GPSL Disposal”

the possible disposal of the Disposable GPSL Shares for a period of 12-month from the date on which the disposal is approved by the Shareholders if the disposal of the GPSL Shares would constitute a major transaction under the Listing Rules

– 2 –

DEFINITIONS

“Possible Luen Wong Disposal”	the possible disposal of the Disposable Luen Wong Shares
	for a period of 12-month from the date on which the
	disposal is approved by the Shareholders if the disposal of
	Luen Wong Shares would constitute a major transaction
	under the Listing Rules
“Possible WLS Disposal”	the possible disposal of the Disposable WLS Shares for a
	period of 12-month from the date on which the disposal is
	approved by the Shareholders if the disposal of the WLS
	Shares, standing alone and/or aggregate with previous
	disposals of WLS Shares, would constitute a major
	transaction under the Listing Rules
“SFO”	the Securities and Futures Ordinance (Chapter 571 of the
	Laws of Hong Kong)
“SGM”	the special general meeting to be convened and held by the
	Company to consider and (i) ratify the CJH Disposal, (ii)
	ratify the Luen Wong Acquisition, (iii) approve the Possible
	CJH Disposal, (iv) approve the Possible WLS Disposal, (v)
	approve the Possible Luen Wong Disposal and (vi) approve
	the Possible GPSL Disposal
“Share(s)”	ordinary share(s) of HK$0.01 each in the share capital of
	the Company
“Shareholder(s)”	holder(s) of Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Trading Day(s)”	a day on which the Stock Exchange is open for general
	trading of securities (and whether or not the CJH Shares,
	the WLS Shares, the GPSL Shares or the Luen Wong Shares
	(as the case may be) are suspended from trading for all or
	part of such day)
“WLS”	WLS Holdings Limited, a company incorporated in the
	Cayman Islands and continued in Bermuda with limited
	liability whose shares are listed on the Growth Enterprise
	Market of the Stock Exchange (stock code: 8021)
“WLS Share(s)”	ordinary share(s) with a nominal value of HK$0.01 each in
	the share capital of WLS
“%”	per cent.

– 3 –

LETTER FROM THE BOARD

China Environmental Energy Investment Limited

(Incorporated in Bermuda with limited liability)

(Stock Code: 986)

Executive Directors: Ms. Chen Tong (Chairman) Mr. Xiang Liang

Independent non-executive Directors: Ms. Zhang Ruisi Mr. Tse Kwong Chan Ms. Zhou Jue

Registered office Clarendon House 2 Church Street Hamilton HM11 Bermuda

Head office and principal place of business: Room 910, 9/F Harbour Centre 25 Harbour Road, Wanchai Hong Kong

22 September 2016

To the Shareholders

Dear Sir or Madam,

MAJOR TRANSACTION ACQUISITION OF SECURITIES OF LUEN WONG GROUP HOLDINGS LIMITED; AND

MAJOR TRANSACTION AGGREGATE DISPOSAL OF SECURITIES OF CHINA JICHENG HOLDINGS LIMITED; AND

GRANTING OF MANDATE FOR POSSIBLE DISPOSAL OF EQUITY INTEREST IN CHINA JICHENG HOLDINGS LIMITED, WLS HOLDINGS LIMITED, LUEN WONG GROUP HOLDINGS LIMITED,

AND

GREATERCHINA PROFESSIONAL SERVICES LIMITED

INTRODUCTION

Reference is made to the announcement of the Company dated 18 August 2016 in relation to a number of matters including the Luen Wong Acquisition, the CJH Disposal, the Possible CJH Disposal, the Possible WLS Disposal, the Possible Luen Wong Disposal and the Possible GPSL Disposal.

• For identification purposes only

– 4 –

LETTER FROM THE BOARD

The Company announced in the Announcement that the Board proposed to seek Shareholders’ ratification for the Luen Wong Acquisition and the CJH Disposal, as well as Shareholders’ approval for the Possible CJH Disposal, the Possible WLS Disposal, the Possible Luen Wong Disposal and the Possible GPSL Disposal.

THE LUEN WONG ACQUISITION

The Company acquired on-market of a total of 17,840,000 Luen Wong Shares in a series of transactions conducted on 20 July 2016, at the price between HK$6.75 and HK$7.00 per Luen Wong Share for an aggregate purchase price of HK$124,465,800 (exclusive of transaction costs).

As the Luen Wong Acquisition was made through the market, the Company was not aware of the identities of the sellers of the Luen Wong Shares and accordingly, to the best knowledge, information and belief of the Directors and having made all reasonable enquiries, the sellers of the Luen Wong Shares are third parties independent of the Company and its connected persons.

Assets acquired

The Group acquired a total of 17,840,000 Luen Wong Shares, representing approximately 1.43% of the issued share capital of Luen Wong (based on 1,248,000,000 issued Luen Wong Shares as at 31 August 2016 according to the monthly return of Luen Wong dated 1 September 2016).

Prior to the Luen Wong Acquisition, the Company did not hold any shares in Luen Wong. After the Luen Wong Acquisition, the Company now holds approximately 1.43% of the issued share capital of Luen Wong.

Consideration

The aggregate purchase price of the Luen Wong Shares is HK$124,465,800 (excluding transaction costs), which is payable in cash on settlement. The consideration for the Luen Wong Acquisition represented the market price of the Luen Wong Shares at the time of the Luen Wong Acquisition.

INFORMATION OF LUEN WONG

Luen Wong is a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Growth Enterprise Market of the Stock Exchange (stock code: 8217). Luen Wong is principally engaged in the provision of civil engineering works.

The following information is extracted from the 2016 annual report of Luen Wong:

	Year ended 31 March	Year ended 31 March
	2016	2015
	HK$’000	HK$’000
Revenue	315,004	271,949
Profit before tax	12,061	21,703
Profit after tax	8,391	18,079
Net assets	27,095	8,304

– 5 –

LETTER FROM THE BOARD

REASONS FOR AND BENEFITS OF THE LUEN WONG ACQUISITION

The Group is principally engaged in the businesses of online products sales, provision of marketing, web design and maintenance services, trading of gold and diamond, money lending services and financial services.

The Directors are of the view that the Luen Wong Acquisition provides the Group with a good investment opportunity to expand investment portfolio with quality assets. Having considered the recent performance of Luen Wong, the Directors also believe that the Luen Wong Acquisition is an attractive investment which will provide satisfactory return. The Directors are of the view that the Luen Wong Acquisition will not cause any adverse effects on the gearing ratio of the Company.

As the Luen Wong Acquisition was made at market price, the Directors are of the view that the Luen Wong Acquisition is fair and reasonable, on normal commercial terms and in the interests of the Company and the Shareholders as a whole.

THE CJH DISPOSAL

The Group disposed on-market of a total of 817,030,000 CJH Shares in a series of transactions conducted on 20 July 2016 and 21 July 2016, at the price between HK$0.201 and HK$0.243 per CJH Share for an aggregate gross sale proceeds of HK$176,269,580 (excluding transaction costs).

As the CJH Disposal was made on the market, the Company is not aware of the identities of the purchasers of the CJH Shares. To the best of the knowledge, information and belief of the Directors, having made all reasonable enquiries, each of the purchasers of the CJH Shares and their ultimate beneficial owners are third parties independent of the Company and its connected persons.

Assets disposed of

The Group disposed of a total of 817,030,000 CJH Shares, representing approximately 1.09% of the issued share capital of CJH (based on 75,000,000,000 issued CJH Shares as at 31 August 2016 according to the monthly return of CJH dated 1 September 2016).

Prior to the CJH Disposal, the Company held 1,395,500,000 CJH Shares, representing approximately 1.86% of the issued share capital of CJH. After the CJH Disposal, the Company now holds 578,470,000 CJH Shares, representing 0.77% of the issued share capital of CJH.

Consideration

The aggregate gross sale proceeds of the Disposal is HK$176,269,580 (excluding transaction costs), which is receivable in cash on settlement. The consideration for the CJH Disposal represented the market price of the CJH Shares at the time of the CJH Disposal.

– 6 –

LETTER FROM THE BOARD

INFORMATION OF CJH

CJH is a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Main Board of the Stock Exchange (stock code: 1027). CJH is principally engaged in the manufacturing and sale of POE umbrellas, nylon umbrellas and umbrella parts such as plastic cloth and shaft.

The following information is extracted from the 2015 annual report of CJH:

	For the	For the
	year ended	year ended
	31 December	31 December
	2015	2014
	RMB’000	RMB’000
Revenue	657,667	602,516
Profit before taxation	50,033	102,498
Profit after taxation	25,229	74,159
Net assets	425,160	240,240

REASONS FOR AND BENEFITS OF THE CJH DISPOSAL

The Group is principally engaged in the businesses of online products sales, provision of marketing, web design and maintenance services, trading of gold and diamond, money lending services and financial services.

The purpose of the CJH Disposal is to realize investment gain and obtain additional cash flow. As a result of the CJH Disposal, the Group is expected to recognize a gain of approximately HK$169 million which is calculated on the basis of the difference between the acquisition price and the disposal price (exclusive of transaction costs). The Company has used the proceeds of the CJH Disposal as to (i) approximately HK$124.47 million (exclusive of transaction costs) in acquisition of 17,840,000 Luen Wong Shares; (ii) approximately HK$51.18 million (exclusive of transaction costs) in acquisition of 165,010,000 WLS Shares; and (iii) approximately HK$0.62 million being transaction costs incurred on acquisition of Luen Wong and WLS Shares together with the disposal of CJH Shares.

The CJH Disposal was made at market price and the Board is of the view that the CJH Disposal will enhance the investment portfolio of the Company and was fair and reasonable and is on normal commercial terms and is in the interests of the Company and the Shareholders as a whole.

THE POSSIBLE CJH DISPOSAL

The Company also intends to seek the Shareholders’ approval for the Possible CJH Disposal of up to 578,470,000 CJH Shares for the period from the date on which the Possible CJH Disposal is approved by the Shareholders to 21 July 2017, being the date falling on 12 months from 21 July 2016, the date of last disposal of CJH Shares by the Company. The Possible CJH Disposal will be conducted on open market transactions on the Stock Exchange.

– 7 –

LETTER FROM THE BOARD

In deciding to effect the Possible CJH Disposal, the Board will take into account the then market sentiment and the then market prices of the CJH Shares when the Possible CJH Disposal is in effect. The Possible CJH Disposal will be effected on the following conditions:

• (a) the Possible CJH Disposal will be conducted on normal commercial terms and will be fair and reasonable and in the interests of the Company and the Shareholders as a whole;

• (b) the price of the Possible CJH Disposal will be received in cash; and

• (c) the selling price of each Disposable CJH Share will be not less than the higher of (i) 90% of the average closing price of CJH Shares for the 10 consecutive Trading Days (where the trading of the CJH Shares is suspended on any Trading Day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the CJH Shares on such Trading Day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$0.009, being the approximate average acquisition cost for each of the Disposable CJH Shares; PROVIDED THAT the Board shall have discretion to sell each Disposable CJH Share at a price not lower than HK$0.007, being 80% of the approximate average acquisition cost for each of the Disposable CJH Shares in case of market downturn which refers to a persistent market-wide decline in stock prices coupled with a pessimistic sentiment about the market.

Since the Possible CJH Disposal is to be effected on open market, the identity of the counterparty to the disposal cannot be ascertained.

The Disposable CJH Shares

The Disposable CJH Shares represent (i) all of the 578,470,000 CJH Shares held by the Group, and were acquired at an average price of approximately HK$0.009, and (ii) approximately 0.77% of the issued share capital of CJH (based on the 75,000,000,000 CJH Shares as at 31 August 2016 according to the monthly return of CJH dated 1 September 2016).

Condition precedent

The Possible CJH Disposal shall be conditional upon the approval by the Shareholders at the SGM.

In the event that the Possible CJH Disposal is not approved by the Shareholders at the SGM, the Company will not be able to further dispose of any CJH Shares for the period stipulated.

– 8 –

LETTER FROM THE BOARD

Financial effects of the Possible CJH Disposal

For illustration purposes only, assuming all of the Disposable CJH Shares had been disposed of at the closing price of HK$0.255 per CJH Share as quoted on the Stock Exchange on the day immediately prior to the Latest Practicable Date, the Group would record a profit on the Possible CJH Disposal (before expenses) of approximately HK$142.42 million, being the difference between approximately HK$147.51 million, the aggregate market price of the Disposable CJH Shares and approximately HK$5.09 million, the aggregate cost of the Disposable CJH Shares.

THE POSSIBLE WLS DISPOSAL

The Company also intends to seek the Shareholders’ approval for the Possible WLS Disposal of up to 524,010,000 WLS Shares for a period of 12-month from the date on which the Possible WLS Disposal is approved by the Shareholders, if the disposal of the WLS Shares, standing alone and/or aggregate with previous disposals of WLS Shares, would constitute a major transaction under the Listing Rules. The Possible WLS Disposal will be conducted on open market transactions on the Stock Exchange.

In deciding to effect the Possible WLS Disposal, the Board will take into account the then market sentiment and the then market prices of the WLS Shares when the Possible WLS Disposal is in effect. The Possible WLS Disposal will be effected on the following conditions:

• (a) the Possible WLS Disposal will be conducted on normal commercial terms and will be fair and reasonable and in the interests of the Company and the Shareholders as a whole;

• (b) the price of the Possible WLS Disposal will be received in cash; and

• (c) the selling price of each Disposable WLS Share will be not less than the higher of (i) 90% of the average closing price of WLS Shares for the 10 consecutive Trading Days (where the trading of the WLS Shares is suspended on any Trading Day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the WLS Shares on such Trading Day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$0.124, being the approximate average acquisition cost for each of the Disposable WLS Shares; PROVIDED THAT the Board shall have discretion to sell each Disposable WLS Share at a price not lower than HK$0.099, being 80% of the approximate average acquisition cost for each of the Disposable WLS Shares in case of market downturn which refers to a persistent market-wide decline in stock prices coupled with a pessimistic sentiment about the market.

Since the Possible WLS Disposal is to be effected on open market, the identity of the counterparty to the Possible WLS Disposal cannot be ascertained.

The Disposable WLS Shares

The Disposable WLS Shares represent (i) all of the 524,010,000 WLS Shares held by the Group, and were acquired at an average price of approximately HK$0.124, and (ii) approximately 4.10% of the issued share capital of WLS (based on the 12,767,101,072 WLS Shares as at 31 August 2016 according to the monthly return of WLS dated 1 September 2016).

– 9 –

LETTER FROM THE BOARD

INFORMATION OF WLS

WLS is a company incorporated in the Cayman Islands and continued in Bermuda with limited liability whose shares are listed on the Growth Enterprise Market of the Stock Exchange (stock code: 8021). WLS is principally engaged in the provision of scaffolding and fitting out services, management contracting services, and other services for construction and buildings work and money lending business.

The following information is extracted from the 2016 annual report of WLS:

	Year ended 30 April	Year ended 30 April
	2016	2015
	HK$’000	HK$’000
Revenue	155,451	136,641
Loss before tax	16,812	7,528
Loss after tax	22,501	7,734
Net assets	796,187	298,226

Condition precedent

The Possible WLS Disposal shall be conditional upon the approval by the Shareholders at the SGM.

In the event that the Possible WLS Disposal is not approved by the Shareholders at the SGM, the Company will only be able to dispose of such number of WLS Shares which, standing alone and aggregate with previous disposals of WLS Shares owned by the Group, constitutes a discloseable transaction of the Company under the Listing Rules.

Financial effects of the Possible WLS Disposal

For illustration purposes only, assuming all of the Disposable WLS Shares had been disposed of at the closing price of HK$0.234 per WLS Share as quoted on the Stock Exchange on the Trading Day immediately prior to the Latest Practicable Date, the Group would record a profit on the Possible WLS Disposal (before expenses) of approximately HK$57.97 million, being the difference between approximately HK$122.62 million, the aggregate gross sale proceeds of the Disposable WLS Shares and approximately HK$64.65 million, the aggregate cost of the Disposable WLS Shares.

THE POSSIBLE LUEN WONG DISPOSAL

The Company also intends to seek the Shareholders’ approval for the Possible Luen Wong Disposal of up to 17,840,000 Luen Wong Shares for a period of 12-month from the date on which the Possible Luen Wong Disposal is approved by the Shareholders if the disposal of Luen Wong Shares would constitute a major transaction under the Listing Rules. The Possible Luen Wong Disposal will be conducted on open market transactions on the Stock Exchange.

In deciding to effect the Possible Luen Wong Disposal, the Board will take into account the then market sentiment and the then market prices of the Luen Wong Shares when the Possible Luen Wong Disposal is in effect. The Possible Luen Wong Disposal will be effected on the following conditions:

– 10 –

LETTER FROM THE BOARD

• (a) the Possible Luen Wong Disposal will be conducted on normal commercial terms and will be fair and reasonable and in the interests of the Company and the Shareholders as a whole;

• (b) the price of the Possible Luen Wong Disposal will be received in cash; and

• (c) the selling price of each Disposable Luen Wong Share will be not less than the higher of (i) 90% of the average closing price of Luen Wong Shares for the 10 consecutive Trading Days (where the trading of the Luen Wong Shares is suspended on any Trading Day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the Luen Wong Shares on such Trading Day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$6.977, being the approximate average acquisition cost for each of the Disposable Luen Wong Shares; PROVIDED THAT the Board shall have discretion to sell each Disposable Luen Wong Share at a price not lower than HK$5.582, being 80% of the approximate average acquisition cost for each of the Disposable Luen Wong Shares in case of market downturn which refers to a persistent market-wide decline in stock prices coupled with a pessimistic sentiment about the market.

Since the Possible Luen Wong Disposal is to be effected on open market, the identity of the counterparty to the disposal cannot be ascertained.

The Disposable Luen Wong Shares

The Disposable Luen Wong Shares represent (i) all of the 17,840,000 Shares held by the Group, and were acquired at an average price of HK$6.977, and (ii) 1.43% of the issued share capital of Luen Wong (based on the 1,248,000,000 issued Luen Wong Shares as at 31 August 2016 according to the monthly return of Luen Wong dated 1 September 2016).

Condition precedent

The Possible Luen Wong Disposal shall be conditional upon the approval by the Shareholders at the SGM.

In the event that the Possible Luen Wong Disposal is not approved by the Shareholders at the SGM, the Company will only be able to dispose of such number of Luen Wong Shares which constitutes a discloseable transaction of the Company under the Listing Rules.

– 11 –

LETTER FROM THE BOARD

Financial effects of the Possible Luen Wong Disposal

For illustration purposes only, assuming all of the Disposable Luen Wong Shares had been disposed of at the closing price of HK$16.80 per Luen Wong Share as quoted on the Stock Exchange on the day immediately prior to the Latest Practicable Date, the Group would record a profit on the Possible Luen Wong Disposal (before expenses) of approximately HK$175.25 million, being the difference between approximately HK$299.72 million, the aggregate market price of the Disposable Luen Wong Shares and approximately HK$124.47 million, the aggregate cost of the Disposable Luen Wong Shares.

THE POSSIBLE GPSL DISPOSAL

The Company also intends to seek the Shareholders’ approval for the Possible GPSL Disposal of up to 52,945,000 GPSL Shares for a period of 12-month from the date on which the Possible GPSL Disposal is approved by the Shareholders in case the disposal of the GPSL Shares would constitute a major transaction under the Listing Rules. The Possible GPSL Disposal will be conducted on open market transactions on the Stock Exchange.

In deciding to effect the Possible GPSL Disposal, the Board will take into account the then market sentiment and the then market prices of the GPSL Shares when the Possible GPSL Disposal is in effect. The Possible GPSL Disposal will be effected on the following conditions:

• (a) the Possible GPSL Disposal will be conducted on normal commercial terms and will be fair and reasonable and in the interests of the Company and the Shareholders as a whole;

• (b) the price of the Possible GPSL Disposal will be received in cash; and

• (c) the selling price of each Disposable GPSL Share will be not less than the higher of (i) 90% of the average closing price of GPSL Shares for the 10 consecutive Trading Days (where the trading of the GPSL Shares is suspended on any Trading Day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the GPSL Shares on such Trading Day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$0.629, being the approximate average acquisition cost for each of the Disposable GPSL Shares; PROVIDED THAT the Board shall have discretion to sell each Disposable GPSL Share at a price not lower than HK$0.503, being 80% of the approximate average acquisition cost for each of the Disposable GPSL Shares in case of market downturn which refers to a persistent market-wide decline in stock prices coupled with a pessimistic sentiment about the market.

Since the Possible GPSL Disposal is to be effected on open market, the identity of the counterparty to the Possible GPSL Disposal cannot be ascertained.

The Disposable GPSL Shares

The Disposable GPSL Shares represent (i) all of the 52,945,000 GPSL Shares held by the Group, and were acquired at an average price of approximately HK$0.629, and (ii) approximately 1.09% of the issued share capital of GPSL (based on the 4,857,968,600 GPSL Shares as at 31 August 2016 according to the monthly return of GPSL dated 1 September 2016).

– 12 –

LETTER FROM THE BOARD

INFORMATION OF GPSL

GPSL is a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Growth Enterprise Market of the Stock Exchange (stock code: 8193). GPSL is principally engaged in the provision of (i) asset appraisal and asset advisory services; (ii) corporate services and consultancy services; (iii) media advertising services; and (iv) financial services.

The following information is extracted from the 2016 annual report of GPSL:

	Year ended 31 March	Year ended 31 March
	2016	2015
	HK$’000	HK$’000
Revenue	55,079	45,983
Profit/(Loss) before tax	11,538	(125,626)
Loss after tax	(1,704)	(127,227)
Net assets	562,701	140,089

Condition precedent

The Possible GPSL Disposal shall be conditional upon the approval by the Shareholders at the SGM.

In the event that the Possible GPSL Disposal is not approved by the Shareholders at the SGM, the Company will only be able to dispose of such number of GPSL Shares which constitutes a discloseable transaction of the Company under the Listing Rules.

Financial effects of the Possible GPSL Disposal

For illustration purposes only, assuming all of the Disposable GPSL Shares had been disposed of at the closing price of HK$0.67 per GPSL Share as quoted on the Stock Exchange immediately prior to the Latest Practicable Date, the Group would record a profit on the Possible GPSL Disposal (before expenses) of approximately HK$2.17 million, being the difference between approximately HK$35.47 million, the aggregate gross sale proceeds of the Disposable GPSL Shares and approximately HK$33.30 million, the aggregate cost of the Disposable GPSL Shares.

COUNTERPARTY TO THE POSSIBLE DISPOSALS

Since the Possible Disposals are to be effected on open market, the counterparty to the Possible Disposals cannot be ascertained. The Company will make sure that having made all reasonable enquiry, to the best of the directors’ knowledge, information and belief, the counterparty and the ultimate beneficial owner of the counterparty are third parties independent of the Company and connected persons of the Company.

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LETTER FROM THE BOARD

REASONS AND BENEFITS FOR THE POSSIBLE DISPOSALS

The Group is principally engaged in the businesses of online products sales, provision of marketing, web design and maintenance services, trading of gold and diamond, money lending services and financial services.

The purpose of the Possible Disposals is to realize investment gain and obtain additional cash flow.

The expected total gross proceeds from the Possible Disposals amount to approximately HK$605.32 million, the breakdown of which is as follows:

		Expected
		approximate
		gross
		proceeds from
Disposal		the disposal
		(HK$)
Possible	CJH Disposal	147.51 million
Possible	WLS Disposal	122.62 million
Possible	Luen Wong Disposal	299.72 million
Possible	GPSL Disposal	35.47 million

The Possible Disposals are to be made at market price and the Board is of the view that the Possible Disposals will enhance the liquidity of the Company and are fair and reasonable and are on normal commercial terms and are in the interests of the Company and the Shareholders as a whole.

FINANCIAL EFFECT OF THE DISPOSAL AND USE OF PROCEEDS

The investments in listed shares of CJH, WLS, Luen Wong and GPSL are currently classified in the financial statements of the Company as “Available-for-sale investments”. As a result of the Possible Disposals on the day prior to the Latest Practicable Date, the Company would recognize a net gain of approximately HK$376.15 million, which is calculated by reference to: (i) the gross proceeds of approximately HK$605.32 million; (ii) less the carrying value of such disposable shares of approximately HK$463.88 million; (iii) plus the release of investment revaluation reserves of approximately HK$236.37 million and (iv) less the estimated transaction costs of approximately HK$1.66 million.

The purpose of the Possible Disposals is to realize the investment and enhance the liquidity of the Company. It increases the amount of net cash of the Group for approximately HK$603.66 million from sales proceeds less estimated transaction costs. The Group intends to use the net sale proceeds of the Possible Disposals (i) as general working capital; (ii) for developing the Group’s money lending business; (iii) for the development of the Group’s financial services business; and (iv) for future investment opportunities.

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LETTER FROM THE BOARD

THE LISTING RULES IMPLICATIONS

The Luen Wong Acquisition constitutes a major transaction of the Company as one or more of the applicable percentage ratios is 25% or more, but less than 100%, and is therefore subject to reporting, announcement and shareholders’ approval requirement pursuant to Chapter 14 of the Listing Rules.

The CJH Disposal standing alone and aggregate with previous disposals of CJH Shares (details of which were set out in the Company’s announcements dated 19 January 2016 and 22 January 2016) constitutes a major transaction of the Company as one or more of the applicable percentage ratios is 25% or more, but less than 75%, and is therefore subject to reporting, announcement and shareholders’ approval requirement pursuant to Chapter 14 of the Listing Rules.

The Luen Wong Acquisition and the CJH Disposal, being major transactions under Chapter 14 of the Listing Rules, require shareholders’ approval. Such shareholders’ approvals were however, in non-compliance with the Listing Rules, not obtained before the Company effected the Luen Wong Acquisition and CJH Disposal. Shareholders’ approvals for the Luen Wong Acquisition and CJH Disposal are required in order for the Company to comply with the Listing Rules and rectify the Luen Wong Acquisition and the CJH Disposal.

The Possible CJH Disposal standing alone and aggregate with previous disposals of CJH Shares constitutes a major transaction of the Company as one or more of the applicable percentage ratios is 25% or more, but less than 75%, and is therefore subject to reporting, announcement and shareholders’ approval requirement pursuant to Chapter 14 of the Listing Rules.

The Possible WLS Disposal, standing alone and aggregate with previous disposals of WLS Shares, constitutes a major transaction of the Company as one or more of the applicable percentage ratios is 25% but less than 75%, and is therefore subject to the relevant reporting, announcement requirement and Shareholders’ approval requirement under Chapter 14 of the Listing Rules.

The Possible Luen Wong Disposal constitutes a major transaction of the Company as one or more of the applicable percentage ratios is 25% or more, but less than 75%, and is therefore subject to the relevant reporting, announcement and shareholders’ approval requirement pursuant to Chapter 14 of the Listing Rules.

The Possible GPSL Disposal constitutes a discloseable transaction of the Company as one or more of the applicable percentage ratios exceeds 5% but is less than 25%, and is therefore subject to the relevant reporting and announcement requirements, and not subject to Shareholders’ approval under Chapter 14 of the Listing Rules. The Company nevertheless intends to seek Shareholders’ approval in view of the performance of and possible increase in share price of GPSL Shares in the future.

GENERAL

A notice convening the SGM to be held on 11 October 2016 at 10:00 a.m. at Falcon Room I, Gloucester Luk Kwok Hong Kong, 72 Gloucester Road, Wanchai, Hong Kong is set out on pages 31 to 35 of this circular. A form of proxy for use at the SGM is enclosed with this circular. Such form of proxy is also published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.986.com.hk).

– 15 –

LETTER FROM THE BOARD

Whether or not you are able to attend the SGM, please complete and sign the accompanying form of proxy in accordance with the instructions printed thereon and return it to the branch share registrar of the Company in Hong Kong, Tricor Tengis Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, 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 adjournment thereof. Completion and return of the form of proxy will not preclude shareholders from attending and voting in person at the meeting if they so wish and, in such event, the form of proxy shall be deemed to be revoked.

The SGM will be convened and held for the Shareholders to consider and, if thought fit, (i) ratify the Luen Wong Acquisition, (ii) ratify the CJH Disposal, (iii) approve the Possible CJH Disposal, (iv) approve the Possible WLS Disposal, (v) approve the Possible Luen Wong Disposal and (vi) approve the Possible GPSL Disposal. To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, no Shareholder or any of its close associates has any material interest in the Luen Wong Acquisition, the CJH Disposal, the Possible CJH Disposal, the Possible WLS Disposal, the Possible Luen Wong Disposal and the Possible GPSL Disposal, and no Shareholder is required to abstain from voting on the resolution(s) in respect of the above matters at the SGM.

Shareholders and investors should note that there is no assurance that the Company will proceed with the Possible Disposals after obtaining the Shareholders’ approval to proceed with the Possible Disposals. The timing and whether the Company will proceed with the Possible Disposals depends on a number of factors including the then prevailing market prices and market conditions. As such, Shareholders and investors are urged to exercise caution when dealing in the Shares.

RECOMMENDATION

The Board considers that the terms of the Luen Wong Acquisition, the CJH Disposal, the Possible CJH Disposal, the Possible WLS Disposal, the Possible Luen Wong Disposal and the Possible GPSL Disposal are on normal commercial terms and are fair and reasonable and are in the interests of the Company and its Shareholders as a whole. Accordingly, the Board recommends the Shareholders to vote in favour of the ordinary resolution to be proposed at the SGM to ratify the Luen Wong Acquisition and the CJH Disposal, and to approve the Possible CJH Disposal, the Possible WLS Disposal, the Possible Luen Wong Disposal and the Possible GPSL Disposal.

ADDITIONAL INFORMATION

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

Yours faithfully By order of the Board

China Environmental Energy Investment Limited Chen Tong Chairman

– 16 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. THREE YEARS’ SUMMARY OF FINANCIAL RESULTS

Financial information of the Group for each of the three years ended 31 March 2014, 2015 and 2016 are disclosed in the following documents which have been published on the websites of the Stock Exchange (http://www.hkexnews.hk) and the Company (www.986.com.hk) respectively:

• annual report of the Company for the year ended 31 March 2014 published on 28 July 2014 (pages 39 to 150);

• annual report of the Company for the year ended 31 March 2015 published on 30 July 2015 (pages 38 to 154);

• annual report of the Company for the year ended 31 March 2016 published on 28 July 2016 (pages 31 to 126);

2. STATEMENT OF INDEBTEDNESS AND CONTINGENT LIABILITIES AS AT 31 AUGUST 2016

As at the close of business on 31 August 2016, the Group had outstanding borrowings of approximately HK$150 million, comprising (1) unsecured promissory notes of HK$130 million; (2) unsecured unconvertible bonds of HK$20 million.

Save as aforesaid and apart from intra-group liabilities and normal trade payables, the Group did not have: (a) any other debt securities issued and outstanding, and authorised or otherwise created but unissued; (b) any other term loans (whether guaranteed, unguaranteed, secured or unsecured); (c) any other borrowings or indebtedness in the nature of borrowing including bank overdrafts and liabilities under acceptances (other than normal trade bills) or acceptance credits or hire purchase commitments; (d) any other mortgages or charges; or (e) any other material guarantees or contingent liabilities as at 31 August 2016. The Directors have confirmed that there have been no material changes in the indebtedness and contingent liabilities of the Group since 31 August 2016, up to and including the Latest Practicable Date.

3. WORKING CAPITAL

The Directors, after due and careful enquiry, are of the opinion that the working capital available to the Group is sufficient for the Group’s requirements for at least the next 12 months from the date of publication of this circular in the absence of unforeseen circumstances after taking into account (i) the internal resources of the Group; (ii) the available credit facilities of the Group; and (iii) the Possible Disposals.

– 17 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

4. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

The Group is principally engaged in the businesses of online products sales, provision of marketing, web design and maintenance services, trading of gold and diamond, money lending services and financial services.

The Directors will continue to enhance the Group’s businesses through review of its existing business portfolio from time to time and also seek suitable investment opportunities in the long run so as to broaden the source of income of the Group and diversify the Group’s business portfolio. For its existing businesses, the Group will allocate more resources to develop those businesses with high growth potential and will consider to divest those businesses with losses or facing intensive competition. In any potential acquisition, the Group will evaluate the management of the target to be acquired as well as the intrinsic value of the acquisition, with an overall goal and strategy to acquire businesses with high intrinsic value at attractive prices. The Company believes that the acquisition of STI Securities & Wealth Management Limited is the prime opportunity to enter the financial services industry. After the completion of such acquisition on 9 August 2016, the Company would strengthen the development of the financial services business, including the provision of securities trading, advising on securities, asset management and margin financing businesses which will help diversifying the businesses, building a stronger business foundation and enlarging the source of income of the Group, thereby creating value for the Shareholders.

5. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 March 2016, being the date to which the latest published audited consolidated financial statements of the Company were made up.

– 18 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP UPON COMPLETION OF THE LUEN WONG ACQUISITION

APPENDIX II

==> picture [227 x 35] intentionally omitted <==

10/F., Allied Kajima Building, 138 Gloucester Road, Wanchai, Hong Kong

INDEPENDENT REPORTING ACCOUNTANT’S ASSURANCE REPORT ON THE COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION

TO THE DIRECTORS OF CHINA ENVIRONMENTAL ENERGY INVESTMENT LIMITED

We have completed our assurance engagement to report on the compilation of unaudited pro forma financial information of China Environmental Energy Investment Limited (the “ Company ”) and its subsidiaries (hereinafter collectively referred to as the “ Group ”) by the directors of the Company (the “ Directors ”) for illustrative purposes only. The unaudited pro forma financial information consists of the unaudited pro forma statement of financial position as at 31 March 2016 and related notes as set out on pages 22 to 25 of the circular dated 22 September 2016 (the “ Circular ”) issued by the Company (the “ Unaudited Pro Forma Financial Information ”), in connection with an aggregate purchase (the “ Transaction ”) of 1.43% of the total issued share capital of Luen Wong Group Holdings Limited. The applicable criteria on the basis of which the Directors have compiled the pro forma financial information are described on pages 22 of the Circular.

The Unaudited Pro Forma Financial Information has been compiled by the Directors to illustrate the impact of the Transaction on the Group’s consolidated financial position as at 31 March 2016 as if the Transaction had taken place at 31 March 2016. As part of this process, information about the Group’s consolidated financial position has been extracted by the Directors from the Group’s consolidated financial statements for the year ended 31 March 2016, on which an annual report has been published.

DIRECTORS’ RESPONSIBILITIES FOR THE UNAUDITED PRO FORMA FINANCIAL INFORMATION

The Directors are responsible for compiling the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “ Listing Rules ”) and with reference to Accounting Guideline 7 Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars (“ AG 7 ”) issued by the Hong Kong Institute of Certified Public Accountants (the “ HKICPA ”).

OUR INDEPENDENCE AND QUALITY CONTROL

We have complied with the independence and other ethical requirements of the “Code of Ethics for Professional Accountants” issued by the HKICPA, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behaviour.

Our firm applies Hong Kong Standard on Quality Control 1 “Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements” issued by the HKICPA and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

– 19 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP UPON COMPLETION OF THE LUEN WONG ACQUISITION

APPENDIX II

REPORTING ACCOUNTANT’S RESPONSIBILITIES

Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the Unaudited Pro Forma Financial Information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the Unaudited Pro Forma Financial Information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements 3420 “Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus” issued by the HKICPA. This standard requires that the reporting accountant plans and performs procedures to obtain reasonable assurance about whether the Directors have compiled the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.

For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the Unaudited Pro Forma Financial Information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the Unaudited Pro Forma Financial Information.

The purpose of Unaudited Pro Forma Financial Information included in the Circular is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the Group as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the event or transaction at 31 March 2016 would have been as presented.

A reasonable assurance engagement to report on whether the Unaudited Pro Forma Financial Information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the Directors in the compilation of the Unaudited Pro Forma Financial Information provide a reasonable basis for presenting the significant effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:

• The related pro forma adjustments give appropriate effect to those criteria; and

• The Unaudited Pro Forma Financial Information reflects the proper application of those adjustments to the unadjusted financial information.

The procedures selected depend on the reporting accountant’s judgment, having regard to the reporting accountant’s understanding of the nature of the Group, the event or transaction in respect of which the Unaudited Pro Forma Financial Information has been compiled, and other relevant engagement circumstances.

The engagement also involves evaluating the overall presentation of the unaudited pro forma financial information.

– 20 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP UPON COMPLETION OF THE LUEN WONG ACQUISITION

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

OPINION

In our opinion:

• (a) the Unaudited Pro Forma Financial Information has been properly compiled on the basis stated;

• (b) such basis is consistent with the accounting policies of the Group; and

• (c) the adjustments are appropriate for the purposes of the Unaudited Pro Forma Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

Cheng & Cheng Limited

Certified Public Accountants Hong Kong

• 22 September 2016

– 21 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP UPON COMPLETION OF THE LUEN WONG ACQUISITION

APPENDIX II

INTRODUCTION

Basis of Preparation of the Unaudited Pro Forma Financial Information of the Group upon Completion of the Transaction

The following is the unaudited pro forma consolidated statement of financial position of the Group prepared on the basis of the notes set out below for the purpose of illustrating the effect of an aggregate purchase (the “ Transaction ”) of the 1.43% of the issued share capital (based on 1,248,000,000 of issued share capital of Luen Wong Group Holdings Limited (“ Luen Wong ”) as at 31 August 2016 according to the monthly return of Luen Wong dated 1 September 2016) of Luen Wong, as if the Transaction had taken place on 31 March 2016.

This Unaudited Pro Forma Financial Information of the Group has been prepared for illustrative purposes only and because of its hypothetical nature, it may not give a true picture of the financial position of the Group upon completion of the Transaction which had been completed as at 31 March 2016 or at any future date.

Unaudited Pro Forma Consolidated Statement of Financial Position of the Group Upon Completion of the Luen Wong Acquisition as at 31 March 2016

Non-current assets Property, plant and equipment Goodwill Interest in an associate Available-for-sale investments Total non-current assets	The Group as at 31 March 2016 (Audited) Pro forma adjustments HK$’000 HK$’000 HK$’000 Note (a) Note (c) Note (d) 11,172 91,493 204,358 835,517 124,662 (124,662) 1,142,540	Unaudited pro forma consolidated statement of financial position of the Group upon completion as at 31 March 2016 HK$’000 11,172 91,493 204,358 835,517
		1,142,540

– 22 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP UPON COMPLETION OF THE LUEN WONG ACQUISITION

Current assets Trade and bills receivables Loan and interest receivables Other receivables, prepayments and deposits paid Cash deposits held by securities brokers Bank balances and cash Assets classified as held for sale Total current assets Current liabilities Trade and bills payables Other payables and accruals Promissory notes payable Income tax payable Liabilities directly associated with assets classified as held for sale Total current liabilities Net current assets Total assets less current liabilities	The Group as at 31 March 2016 (Audited) Pro forma adjustments HK$’000 HK$’000 HK$’000 Note (a) Note (c) Note (d) 3,263 44,427 24,342 7 22,766 (280) 94,805 178,081 272,886 335 54,960 101,381 425 157,101 108,710 265,811 7,075 1,149,615	Unaudited pro forma consolidated statement of financial position of the Group upon completion as at 31 March 2016 HK$’000 3,263 44,427 24,342 7 22,486
		94,525 178,081
		272,606
		335 54,960 101,381 425
		157,101 108,710
		265,811
		6,795
		1,149,335

– 23 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP UPON COMPLETION OF THE LUEN WONG ACQUISITION

Capital and reserves Share capital Share premium and reserves Equity attributable to owners of the Company Non-controlling interests Total equity Non-current liabilities Promissory notes payable Unconvertible bonds Total non-current liabilities	The Group as at 31 March 2016 (Audited) Pro forma adjustments HK$’000 HK$’000 HK$’000 Note (a) Note (c) Note (d) 37,423 1,062,941 (280) 1,100,364 (2,472) 1,097,892 31,289 20,434 51,723 1,149,615	Unaudited pro forma consolidated statement of financial position of the Group upon completion as at 31 March 2016 HK$’000 37,423 1,062,661
		1,100,084 (2,472)
		1,097,612
		31,289 20,434
		51,723
		1,149,335

– 24 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP UPON COMPLETION OF THE LUEN WONG ACQUISITION

Notes to the unaudited pro forma consolidated statement of financial position of the Group upon completion of the Transaction

• (a) The figures are extracted from the consolidated statement of financial position of the Group as at 31 March 2016, as set out in the Group’s published annual report for the year ended 31 March 2016.

• (b) The adjustments represent the accounting treatment of the Transaction in accordance with the Group’s accounting policies. Upon the completion of the Transaction, the investment is classified as available-for-sale investment in non-current asset. The subsequent changes in value are recorded as unrealized gain or loss in other comprehensive income.

• (c) The adjustment represents the consideration of approximately HK$124.66 million payable by the Company upon completion of the Transaction. For the purpose of this Unaudited Pro Forma Financial Information, the consideration payable for the Transaction is expected to be satisfied by the Company in cash generated from the disposal of approximately 577,000,000 shares of China Jicheng Holdings Limited (“ CJH ”) (approximately 0.77% of the issued share capital based on 75,000,000,000 issued CJH Shares as at 31 July 2016 according to the monthly return of CJH dated 1 August 2016).

• (d) The adjustment represents the estimated transaction expenses of approximately HK$280,000, which are mainly professional fee payable by the Group incurred directly attributable to the Transaction.

• (e) No adjustments have been made to remeasure an aggregate purchase of issued share capital of Luen Wong to their fair value as at 31 March 2016 as for the purpose of this Unaudited Pro Forma Financial Information, it is assumed that an aggregate purchase of issued share capital of Luen Wong were acquired at their fair value on 31 March 2016.

• (f) No adjustments have been made to this Unaudited Pro Forma Financial Information to reflect any trading results or other transactions of the Group entered into the subsequent to 31 March 2016.

– 25 –

GENERAL INFORMATION

APPENDIX III

1. RESPONSIBILITY STATEMENT

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. DIRECTORS’ INTERESTS AND SHORT POSITIONS IN THE SHARES, UNDERLYING SHARES AND DEBENTURES OF THE COMPANY

As at the Latest Practicable Date, none of the directors or chief executive of the Company had any interest or short position in the shares, underlying shares or debentures of the Company or any of its associated corporation (within the meaning of Part XV of the SFO which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he/she was deemed or taken to have under such provisions of the SFO) or which were required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein, or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers, to be notified to the Company and the Stock Exchange.

As at the Latest Practicable Date, none of the Directors was a director or employee of a company which had an interest or short position in the Shares and underlying Shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

3. DIRECTORS’ SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service agreement with any member of the Group which will not expire or is not determinable within one year without payment of compensation other than statutory compensation.

4. DIRECTORS’ INTERESTS IN THE GROUP’S ASSETS OR CONTRACTS OR ARRANGEMENTS SIGNIFICANT TO THE GROUP

As at the Latest Practicable Date, none of the Directors had any interest in any assets which have been, since 31 March 2016 (being the date to which the latest published audited accounts of the Company were made up), 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.

None of the Directors was materially interested in any contract or arrangement, subsisting at the Latest Practicable Date, which is significant to the business of the Group.

– 26 –

GENERAL INFORMATION

APPENDIX III

5. DIRECTORS’ INTERESTS IN COMPETING BUSINESS

As at the Latest Practicable Date, none of the Directors or their respective close associates (as defined under the Listing Rules) had any interest in the businesses, other than being a Director, which compete or are likely to compete, either directly or indirectly, with the businesses of the Group pursuant to Rule 8.10 of the Listing Rules.

6. QUALIFICATION AND CONSENT OF EXPERT

The following is the qualification of the expert who has provided its advice for inclusion in this circular:

Name Qualification Cheng & Cheng Limited Certified Public Accountants

Cheng & Cheng Limited has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letters and references to its name in the form and context in which they appear herein.

As at the Latest Practicable Date, Cheng & Cheng Limited did not have any shareholding 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 and it did not have any direct or indirect interest in any assets which have been since 31 March 2016 (being the date to which the latest published audited accounts of the Company were made up) acquired or disposed of by or leased to by any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

7. MATERIAL CONTRACTS

As at the Latest Practicable Date, the following contracts (not being contracts in the ordinary course of business of the Company) have been entered into by members of the Group within two years immediately preceding the Latest Practicable Date which are or may be material:

• (i) a sale and purchase agreement dated 19 May 2016 entered into between the Company as vendor, and Dejuxin Technology Co., Limited, a company incorporated in Hong Kong with limited liability as purchaser in relation to the disposal of 93.33% of the entire issued share capital of Ideal Market Holdings Limited at the consideration of HK$150,000,000;

• (ii) a placing agreement entered into between the Company as issuer and an Independent Third Party as placing agent dated 17 December 2015 in relation to the placing of unconvertible bonds in the maximum principal amount of HK$100,000,000 at a coupon rate of 8% per annum;

– 27 –

GENERAL INFORMATION

APPENDIX III

• (iii) a sale and purchase agreement entered into between the Company as vendor, and Ms. Chow Yan Ping as purchaser dated 27 November 2015 in relation to the disposal of the entire issued share capital of Asian Champion Limited at the consideration of HK$58,000,000;

• (iv) a sale and purchase agreement entered into between the Company as purchaser, and Soar Power Limited, Loyal Charm Limited and Hover Max Limited as vendors dated 20 November 2015 in relation to the acquisition of 39.41% of the entire issued share capital of Pure Power Holdings Limited at the consideration of HK$163,000,000;

• (v) a deed of termination entered into between the Company, Mighty Smart Limited, Soar Power Limited, Loyal Charm Limited, Hover Max Limited and Fortune Glow Limited on 20 November 2015 in relation to the sale and purchase agreement dated 13 November 2015;

• (vi) a sale and purchase agreement entered into between Gold Castle Group Limited, as purchaser, the Company as guarantor and STI Financial Group Limited as vendor dated 16 November 2015 in relation to the acquisition of the entire issued share capital of STI Securities & Wealth Management Limited at the consideration of HK$16,914,035;

• (vii) a sale and purchase agreement entered into between the Company as purchaser and Mighty Smart Limited, Soar Power Limited, Loyal Charm Limited, Hover Max Limited and Fortune Glow Limited as vendors dated 13 November 2015 in relation to the acquisition of 48.38% of the entire issued share capital of Pure Power Holdings Limited at the consideration of HK$200,000,000;

• (viii) a sale and purchase agreement entered into between Pacific Wise Investments Limited as purchaser and Mr. Wan Tak Choi as vendor dated 16 October 2015 in relation to the acquisition of the entire issued share capital of Great Luck Finance Limited at the consideration of HK$1,000,000;

• (ix) a sale and purchase agreement entered into between the Company as purchaser and Mr. Wong Him Shun Philip as vendor dated 4 September 2015 in relation to the acquisition of the entire issued share capital of Elite Honest Inc. at the consideration of HK$30,000,000;

• (x) a placing agreement entered into between the Company as issuer and Southwest Securities (HK) Brokerage Limited as placing agent dated 19 August 2015 in relation to the placing of up to 620,000,000 new shares of the Company at the placing price of HK$0.134 per placing share;

• (xi) a placing agreement entered into between the Company as issuer and Southwest Securities (HK) Brokerage Limited as placing agent dated 20 April 2015 in relation to the placing of up to 520,000,000 new shares of the Company at the placing price of HK$0.245 per placing share;

– 28 –

GENERAL INFORMATION

APPENDIX III

• (xii) a placing letter entered into between Orient Time Investment Limited as subscriber and Tanrich Securities Company Limited as placing agent dated 18 March 2015 in relation to the subscription for shares in WLS Holdings Limited for an aggregate consideration of HK$18,900,000 at the subscription price of HK$0.3 per subscribed share;

• (xiii) a sale and purchase agreement entered into between the Company as purchaser and Mr. Lu Qinglu as vendor dated 21 January 2015 in relation to the acquisition of the entire issued share capital of Platinum Plus International Limited at the consideration of RMB51,000,000;

• (xiv) a supplemental placing agreement entered into between the Company as issuer and Wing Fung Securities Limited as placing agent dated 27 November 2014, pursuant to which the placing price specified in the placing agreement entered into between the parties dated 12 November 2014 and amended by supplemental agreement dated 19 November 2014 was changed from HK$0.97 per placing share to HK$0.66 per placing share;

• (xv) a supplemental placing agreement entered into between the Company as issuer and Wing Fung Securities Limited as placing agent dated 19 November 2014, pursuant to which, among others, the placing price specified in the placing agreement entered into between the parties dated 12 November 2014 was changed from HK$0.96 per placing share to HK$0.97 per placing share;

• (xvi) a share placing agreement entered into between the Company as issuer and Wing Fung Securities Limited as placing agent dated 12 November 2014 in relation to the placing new shares of the Company at the placing price of HK$0.96 per placing share;

• (xvii) an underwriting agreement entered into between the Company as issuer and Wing Fung Securities Limited as underwriter dated 12 November 2014 in relation to rights issue on the basis of eight ordinary shares of HK$0.01 in the capital of the Company to be issued and allotted for every one existing ordinary share in issue and held on 29 December 2014 at HK$0.195 per rights share; and

• (xviii) a sale and purchase agreement entered into between the Company as purchaser and Ms. Chow Yan Ping as vendor dated 18 September 2014 in relation to the acquisition of the entire share capital of Asian Champion Limited at the consideration of HK$58 million.

8. LITIGATIONS

So far as the Directors are aware, neither the Company nor any of its subsidiaries was engaged in any litigation or arbitration of material importance and no litigation or arbitration of material importance was pending or threatened against the Company or any of its subsidiaries as at the Latest Practicable Date.

9. GENERAL

The registered office of the Company is situated at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda.

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GENERAL INFORMATION

APPENDIX III

The head office and principal place of business of the Company in Hong Kong is situated at Room 910, 9/F, Harbour Centre, 25 Harbour Road, Wanchai, Hong Kong.

The Company’s branch share registrar in Hong Kong is Tricor Tengis Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong.

The secretary of the Company is Ms. Cheng Suk Kuen, a member of the Hong Kong Institute of Certified Public Accountants and the CPA Australia.

The English text of this circular shall prevail over the Chinese text, in the event of inconsistency.

10. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection during normal business hours at the head office and principal place of business of the Company in Hong Kong at Room 910, 9/F, Harbour Centre, 25 Harbour Road, Wanchai, 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 material contracts referred to in the paragraph headed “Material Contracts” in this appendix;

• c. the written consent referred to in the paragraph headed “Qualification and Consent of Expert” in this appendix;

• d. the annual reports of the Company for the years ended 31 March 2015 and 2016 respectively; and

• e. this circular.

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NOTICE OF SPECIAL GENERAL MEETING

China Environmental Energy Investment Limited

(Incorporated in Bermuda with limited liability)

(Stock Code: 986)

NOTICE OF SPECIAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that a special general meeting (the “ SGM ”) of China Environmental Energy Investment Limited (the “ Company ”) will be held on 11 October 2016 at 10:00 a.m. at Falcon Room I, Gloucester Luk Kwok Hong Kong, 72 Gloucester Road, Wanchai, Hong Kong for the purpose of considering and, if thought fit, passing the following resolution:

ORDINARY RESOLUTION

“ THAT

1. (a) The Company’s acquisition of 17,840,000 shares in Luen Wong Group Holdings Limited in a series of transactions conducted on 20 July 2016, at the price between HK$6.75 and HK$7.00 per share for an aggregate purchase price of HK$124,465,800 (the “ Luen Wong Acquisition ”) be and is hereby ratified and confirmed.

2. (b) Any one director of the Company be and is hereby authorized for and on behalf of the Company to execute all such documents, instruments and agreements and do all such acts, matters and things as he/she may in his/her absolute discretion consider necessary, desirable or expedient for the purposes of or in connection with implementing, completing and giving effect to the Luen Wong Acquisition and the transactions contemplated thereunder and to agree to such variations of the terms of the Luen Wong Acquisition as he/she may in his/her absolute discretion consider necessary or desirable.

3. (a) The Company’s disposal of 817,030,000 shares in China Jicheng Holdings Limited in a series of transactions conducted on 20 July 2016 and 21 July 2016, at the price between HK$0.201 and HK$0.243 per share for an aggregate gross sale proceeds of HK$176,269,580 (the “ CJH Disposal ”) be and is hereby ratified and confirmed.

4. (b) Any one director of the Company be and is hereby authorized for and on behalf of the Company to execute all such documents, instruments and agreements and do all such acts, matters and things as he/she may in his/her absolute discretion consider necessary, desirable or expedient for the purposes of or in connection with implementing, completing and giving effect to the CJH Disposal and the transactions contemplated thereunder and to agree to such variations of the terms of the CJH Disposal as he/she may in his/her absolute discretion consider necessary or desirable.

• For identification purposes only

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NOTICE OF SPECIAL GENERAL MEETING

1. (a) Subject to paragraph (b) below, the disposal by the Company and/or its subsidiaries of up to 578,470,000 shares (the “ Disposable CJH Shares ”) of HK$0.00008 each (each a “ CJH Share ”) in China Jicheng Holdings Limited from time to time from the date on which this resolution is approved to 21 July 2017, being the date falling on 12 months from 21 July 2016, the date of last disposal of CJH Shares by the Company be and is hereby approved and authorized.

2. (b) No disposal of CJH Shares pursuant to the authority granted under the ordinary resolution shall be made unless:

   • (i) the disposal of CJH Shares is conducted on market;

   • (ii) the price of the CJH Shares will be received in cash; and

   • (iii) the selling price of each Disposable CJH Share will be not less than the higher of (i) 90% of the average closing price of CJH Shares for the 10 consecutive trading days (where the trading of the CJH Shares is suspended on any trading day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the CJH Shares on such trading day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$0.009, being the approximate average acquisition cost for each of the Disposable CJH Shares; PROVIDED THAT in case of market downturn the board of directors of the Company shall have discretion to sell each Disposable CJH Share at a price not lower than HK$0.007, being 80% of the approximate average acquisition cost for each of the Disposable CJH Shares.

3. (a) Subject to paragraph (b) below, the disposal by the Company and/or its subsidiaries of up to 524,010,000 shares (the “ Disposable WLS Shares ”) of HK$0.01 each (each a “ WLS Share ”) in WLS Holdings Limited from time to time for a period of 12-month from the date on which this resolution is approved, if the disposal of the WLS Shares, standing alone and/or aggregate with previous disposals of WLS Shares, would constitute a major transaction under the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited (the “ Listing Rules ”) be and is hereby approved and authorized.

4. (b) No disposal of WLS Shares pursuant to the authority granted under the ordinary resolution shall be made unless:

   • (i) the disposal of WLS Shares is conducted on market;

   • (ii) the price of the WLS Shares will be received in cash; and

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NOTICE OF SPECIAL GENERAL MEETING

  - (iii) the selling price of each Disposable WLS Share will be not less than the higher of (i) 90% of the average closing price of WLS Shares for the 10 consecutive trading days (where the trading of the WLS Shares is suspended on any trading day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the WLS Shares on such trading day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$0.124, being the approximate average acquisition cost for each of the Disposable WLS Shares; PROVIDED THAT in case of market downturn the board of directors of the Company shall have discretion to sell each Disposable WLS Share at a price not lower than HK$0.099, being 80% of the approximate average acquisition cost for each of the Disposable WLS Shares.

1. (a) Subject to paragraph (b) below, the disposal by the Company and/or its subsidiaries of up to 17,840,000 shares (the “ Disposable Luen Wong Shares ”) of HK$0.01 each (each a “ Luen Wong Share ”) in Luen Wong Group Holdings Limited from time to time for a period of 12-month from the date on which this resolution is approved, if the disposal of the Luen Wong Shares, standing alone and/or aggregate with previous disposals of Luen Wong Shares, would constitute a major transaction under the Listing Rules be and is hereby approved and authorized.

2. (b) No disposal of Luen Wong Shares pursuant to the authority granted under the ordinary resolution shall be made unless:

   • (i) the disposal of Luen Wong Shares is conducted on market;

   • (ii) the price of the Luen Wong Shares will be received in cash; and

   • (iii) the selling price of each Disposable Luen Wong Share will be not less than the higher of (i) 90% of the average closing price of Luen Wong Shares for the 10 consecutive trading days (where the trading of the Luen Wong Shares is suspended on any trading day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the Luen Wong Shares on such trading day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$6.977, being the approximate average acquisition cost for each of the Disposable Luen Wong Shares; PROVIDED THAT in case of market downturn the board of directors of the Company shall have discretion to sell each Disposable Luen Wong Share at a price not lower than HK$5.582, being 80% of the approximate average acquisition cost for each of the Disposable Luen Wong Shares.

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NOTICE OF SPECIAL GENERAL MEETING

1. (a) Subject to paragraph (b) below, the disposal by the Company and/or its subsidiaries of up to 52,945,000 shares (the “ Disposable GPSL Shares ”) of HK$0.01 each (each a “ GPSL Share ”) in GreaterChina Professional Services Limited from time to time for a period of 12-month from the date on which this resolution is approved, if the disposal of the GPSL Shares, standing alone and/ or aggregate with previous disposals of GPSL Shares, would constitute a major transaction under the Listing Rules be and is hereby approved and authorized.

2. (b) No disposal of GPSL Shares pursuant to the authority granted under the ordinary resolution shall be made unless:

   • (i) the disposal of GPSL Shares is conducted on market;

   • (ii) the price of the GPSL Shares will be received in cash; and

   • (iii) the selling price of each Disposable GPSL Share will be not less than the higher of (i) 90% of the average closing price of GPSL Shares for the 10 consecutive trading days (where the trading of the GPSL Shares is suspended on any trading day for the whole day, the closing price on the day immediately prior to such suspension shall be deemed as the closing price of the GPSL Shares on such trading day) immediately prior to the day on which the relevant disposal is effected; and (ii) HK$0.629, being the approximate average acquisition cost for each of the Disposable GPSL Shares; PROVIDED THAT in case of market downturn the board of directors of the Company shall have discretion to sell each Disposable GPSL Share at a price not lower than HK$0.503, being 80% of the approximate average acquisition cost for each of the Disposable GPSL Shares.”

Yours faithfully By order of the Board

China Environmental Energy Investment Limited Chen Tong Chairman

Hong Kong, 22 September 2016

As at the date of this notice, the board of Directors of the Company comprises two executive Directors, namely Ms. Chen Tong (Chairman) and Mr. Xiang Liang; and three independent nonexecutive Directors, namely Ms. Zhang Ruisi, Mr. Tse Kwong Chan and Ms. Zhou Jue.

In the case of inconsistency, the English text of this notice shall prevail over the Chinese text.

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NOTICE OF SPECIAL GENERAL MEETING

Notes:

1. A form of proxy for use at the SGM is enclosed herewith.

2. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under its seal or under the hand of any officer or attorney duly authorised.

3. Any shareholder of the Company entitled to attend and vote at the SGM convened by the above notice shall be entitled to appoint another person as his proxy to attend and vote on behalf of him. A proxy needs not be a shareholder of the Company. A shareholder of the Company who is the holder of two or more shares of the Company may appoint more than one proxy to represent him/her/it to attend and vote on his/her/its behalf. If more than one proxy are so appointed, the appointment shall specify the number and class of shares in respect of which each such proxy is so appointed.

4. In order to be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed, or a certified copy of such power of attorney or authority, must be deposited at the Hong Kong branch share registrar of the Company, Tricor Tengis Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time appointed for holding of the above SGM or any adjournment thereof at which the person named in the form of proxy proposes to vote or, in the case of a poll taken subsequently to the date of the SGM or any adjournment thereof, not less than 24 hours before the time appointed for the taking of the poll and in default the form of proxy shall not be treated as valid.

5. Completion and return of the form of proxy will not preclude a shareholder of the Company from attending and voting in person at the SGM convened or at any adjourned meeting (as the case may be) and in such event, the form of proxy will be deemed to be revoked.

6. Where there are joint holders of any share of the Company, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he/she/it were solely entitled thereto, but if more than one of such joint holders are present at the SGM, whether in person or by proxy, priority shall be determined by the order in which the names stand on the register of members of the Company in respect of the joint holding.

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