Grand Baoxin Auto Group Limited — M&A Activity 2016

Jun 2, 2016

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

This announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for the securities of CGA, the Offeror or the Company.

CHINA GRAND AUTOMOTIVE SERVICES CO. LIMITED 廣 匯 汽 車 服 務 股 份 公 司

(a joint stock limited company incorporated in the People ’ s Republic of China) (SSE Stock Code: 600297)

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BAOXIN AUTO GROUP LIMITED

寶 信 汽 車 集 團 有 限 公 司

(incorporated in the Cayman Islands with limited liability)

(Stock code: 1293)

CHINA GRAND AUTOMOTIVE SERVICES (HONG KONG) LIMITED 廣 匯 汽 車 服 務 （ 香 港 ） 有 限 公 司

(incorporated in Hong Kong with limited liability)

JOINT ANNOUNCEMENT

THE VOLUNTARY CASH PARTIAL OFFER AND OPTION OFFER BY CMB INTERNATIONAL ON BEHALF OF THE OFFEROR TO ACQUIRE A MAXIMUM OF 75 PER CENT. OF THE ISSUED SHARE CAPITAL OF BAOXIN AUTO GROUP LIMITED FROM QUALIFYING SHAREHOLDERS AND TO CANCEL A MAXIMUM OF 75 PER CENT. OF THE OUTSTANDING SHARE OPTIONS HAVE BECOME UNCONDITIONAL IN ALL RESPECTS

Financial Adviser to the Offeror

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INTRODUCTION

Reference is made to (i) the joint announcement dated 11 December 2015 issued by CGA, the Offeror and the Company in relation to, among other things, the pre-conditional voluntary cash Partial Offer and Option Offer by CMB International on behalf of the Offeror to acquire a maximum of 75% of the issued share capital of Baoxin Auto Group Limited from Qualifying Shareholders and to cancel a maximum of 75% of the outstanding Share Options (the ‘‘Rule 3.5 Announcement’’); (ii) the voluntary announcement dated 11 December 2015 issued by the Company in relation to, among other things, the unaudited consolidated results of the Group for the nine months ended 30 September 2015; (iii) the joint announcement dated 11 December 2015 issued by CGA, the Offeror and the Company enclosing the draft SSE Report; (iv) the joint announcement dated 22 December 2015 issued by CGA, the Offeror and the Company enclosing the final SSE Report; (v) the joint announcement dated 28 December 2015 issued by CGA, the Offeror and the Company in relation to the satisfaction of Pre-Condition (c) as set out in the Rule 3.5 Announcement; (vi) the joint announcement dated 25 February 2016 in relation to an update on the satisfaction of the Pre-Conditions as set out in the Rule 3.5 Announcement; (vii) the joint announcement dated 2 March 2016 in relation to the commitment by certain Shareholders to accept the Partial Offer under the Additional Irrevocable Undertakings; (viii) the joint announcement dated 18 March 2016 in relation to the commitment by certain Shareholders to accept the Partial Offer under the Second Round Additional Irrevocable Undertakings; (ix) the joint announcement dated 24 March 2016 in relation to an update on the satisfaction of the Pre-Conditions as set out in the Rule 3.5 Announcement; (x) the joint announcement dated 26 May 2016 issued by CGA, the Offeror and the Company in relation to the Supplemental Agreement to the Irrevocable Undertaking and satisfaction of the PreConditions; (xi) the composite document dated 31 May 2016 jointly issued by CGA, the Offeror and the Company (the ‘‘Composite Document’’); and (xii) the joint announcement dated 31 May 2016 jointly issued by CGA, the Offeror and the Company regarding the despatch of the Composite Document. Unless otherwise stated, capitalised terms used in this announcement shall have the same meanings as those used in the Composite Document.

LEVEL OF ACCEPTANCES

Pursuant to the Irrevocable Undertaking, the relevant Additional Irrevocable Undertakings and the Second Round Additional Irrevocable Undertakings, acceptances were received from Baoxin Investment and Auspicious Splendid in respect of certain IU Shares, from certain Accepting Shareholders and certain Second Round Accepting Shareholders in respect of their respective Shares on 2 June 2016. As at 4:00 p.m. on the date of this announcement, taking into account the acceptances under the Irrevocable Undertaking, the relevant Additional Irrevocable Undertakings and the Second Round Additional Irrevocable Undertakings, the Offeror has received valid acceptances from Qualifying Shareholders in respect of 1,552,780,000 Shares, representing approximately 60.72% of the issued share capital of Company and has no valid acceptances of the Option Offer.

Before the Offer Period commenced on 15 September 2015, none of the Shares or any rights over Shares were held, controlled or directed by the Offeror or parties acting in concert with it.

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Save for the IU Shares, the Shares held by the Accepting Shareholders (other than SIMHKL and SIMSL) and the Shares held by the Second Round Accepting Shareholders, the Offeror and parties acting in concert with it have not acquired or agreed to acquire any Shares and rights over Shares during the Offer Period from 15 September 2015 and up to and including the date of this announcement. Neither the Offeror nor any parties acting in concert with it has borrowed or lent any relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code) of the Company from 15 September 2015 up to and including the date of this announcement.

THE OFFERS HAVE BECOME UNCONDITIONAL IN ALL RESPECTS

The Offeror hereby announces that the Condition set out in paragraph 1 of the letter from CMB International contained in the Composite Document has been satisfied. Accordingly, the Partial Offer has become and is hereby declared unconditional in all respects. Pursuant to Rule 13.4 of the Code, the Option Offer has become and is hereby declared unconditional in all respects.

FINAL CLOSING DATE

Pursuant to Rule 15.1 and Rule 15.3 of the Code, the Offers will remain open for acceptance for not less than 14 days after the Partial Offer becomes unconditional in all respects, provided that such date is no earlier than 21 days after the date of posting of the Composite Document. Accordingly, the latest time and date for acceptance of the Partial Offer will be 4:00 p.m. on 21 June 2016 which will be the Final Closing Date of the Offers. Acceptances of the Offers received after 4:00 p.m. on the Final Closing Date will be rejected. All other terms of the Offers, as set out in the Composite Document and in the Forms of Acceptance, remain unchanged.

ACCEPTANCES

Qualifying Shareholders and Optionholders are advised to read the Composite Document and the Forms of Acceptance carefully, including the advice from the Independent Board Committee and the advice of Somerley, the Independent Financial Adviser, before deciding whether or not to accept the Offers.

Qualifying Shareholders are advised to refer to the Composite Document and the Forms of Acceptance for a description of the acceptance procedures if they wish to accept the Offers. The announcement of the results of the Offers will be jointly issued by CGA, the Offeror and the Company and posted on the Stock Exchange’s website by 7:00 p.m. on the Final Closing Date. Such announcement will comply with the disclosure requirements under Rule 19.1 and Note 7 to Rule 19 of the Code and will include, among other things, the results of the Partial Offer and the Option Offer and details of the way in which each accepting Shareholder’s and each accepting Optionholder’s pro rata entitlement was determined.

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TIMETABLE

Latest time and date for acceptance of the

Partial Offer and the Option Offer (Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:00 p.m. on Tuesday, 21 June 2016

Announcement of the results of the Offers as at

the Final Closing Date to be posted on the website of

the Stock Exchange (Note 2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . no later than 7:00 p.m. on Tuesday, 21 June 2016

Latest date for posting of remittances for amounts due

• under the Partial Offer and the Option Offer (Note 3). . . . . . . . . . . . . . Thursday, 30 June 2016

Notes:

1. In order to accept the Offers, Qualifying Shareholders and Optionholders are required to submit the duly completed Form(s) of Acceptance to the Registrar and to the Company respectively on or before 4:00 p.m. on Tuesday, 21 June 2016, being the Final Closing Date.

2. Beneficial owners of Shares who hold their Shares in CCASS directly as an investor participant or indirectly via a broker or custodian participant should note the timing requirements (set out in Appendix I to the Composite Document) for causing instructions to be made to CCASS in accordance with the General Rules of CCASS and CCASS Operational Procedures.

3. The announcement of the results of the Offers will be jointly issued by CGA, the Offeror and the Company and posted on the Stock Exchange’s website by 7:00 p.m. on the Final Closing Date. Such announcement will comply with the disclosure requirements under Rule 19.1 and Note 7 to Rule 19 of the Code and will include, among other things, the results of the Partial Offer and the Option Offer and details of the way in which each accepting Shareholder’s and each accepting Optionholder’s pro rata entitlement was determined.

4. Remittances in respect of the Shares tendered for acceptance and taken up by the Offeror under the Partial Offer (after deducting the seller’s ad valorem stamp duty arising therefrom and, if applicable, the fees payable to the Registrar in respect of lost or unavailable Share certificates) will be posted to the relevant Qualifying Shareholders by ordinary post at their own risk as soon as possible, but in any event within seven business days (as defined in the Code) following the Final Closing Date. Remittances in respect of the Share Options tendered for acceptance and taken up by the Offeror under the Option Offer will be posted to the relevant Optionholders by ordinary post at their own risk as soon as possible, but in any event within seven business days (as defined in the Code) following the Final Closing Date.

All references to times and dates contained in this announcement are to Hong Kong times and dates.

By order of the board of	By order of the board of	By order of the Board of
China Grand Automotive	China Grand Automotive	Baoxin Auto Group
Services Co., Ltd	Services (Hong Kong)	Limited
	Limited
LI Jianping	WANG Ben	YANG Aihua
Chairman	Director	Chairman

The PRC, 2 June 2016

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As at the date of this announcement, the director of the Offeror is Mr. WANG Ben.

As at the date of this announcement, the directors of CGA are Mr. LI Jianping, Mr. TANG Yongqi, Mr. KONG Lingjiang, Mr. XUE Weidong and Mr. SHANG Yong, and the independent directors of CGA are Mr. SHEN Jinjun, Mr. CHENG Xiaoming and Mr. LIANG Yongming.

As at the date of this announcement, the executive Directors are Mr. YANG Aihua, Mr. YANG Hansong, Mr. YANG Zehua, Ms. HUA Xiuzhen and Mr. ZHAO Hongliang, the nonexecutive Director is Mr. LU Linkui, and the independent non-executive Directors are Mr. DIAO Jianshen, Mr. WANG Keyi and Mr. CHAN Wan Tsun Adrian Alan.

The directors of the Offeror and CGA jointly and severally accept full responsibility for the accuracy of the information contained in this announcement (other than information relating to the Group or any of its associates or any parties acting in concert with it) and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions expressed in this announcement (other than opinions expressed by the Directors) have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement (other than information relating to the CGA Group, the Offeror or any of their associates or any parties acting in concert with any of them) and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions expressed in this announcement (other than opinions expressed by the directors of CGA and the Offeror) have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

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