Snack Empire Holdings Limited - Proxy Solicitation & Information Statement 2015

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 to be taken, you should consult your stockbroker, or other licensed securities dealer, bank manager, solicitors, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Shanghai Zendai Property Limited (the “ Company ”), you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee, or to the bank, stockbroker 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 losses howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

SHANGHAI ZENDAI PROPERTY LIMITED 上海証大房地產有限公司[*]

(Incorporated in Bermuda with limited liability) (Stock code: 755)

VERY SUBSTANTIAL ACQUISITION IN RESPECT OF THE ACQUISITIONS OF THE EQUITY INTERESTS AND THE SALE LOANS

Financial adviser to the Company

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A notice convening a special general meeting of the Company to be held at Unit A, 29/F, Admiralty Center I, 18 Harcourt Road, Hong Kong, on Tuesday, 13 October 2015 at 10:30 a.m. is set out on pages SGM-1 and SGM-2 of this circular. A form of proxy for use at the special general meeting is enclosed.

Whether or not you intend to attend and vote at the special general meeting, you are requested to complete and return the enclosed form of proxy to the Company’s branch share registrar in Hong Kong, Tricor Secretaries Limited at Level 22, Hopewell Center, 183 Queen’s Road East, Wanchai, Hong Kong in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the special general meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the special general meeting or any adjournment thereof should you so wish.

* for identification purpose only

24 September 2015

CONTENTS

			Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			1
Letter from the	Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		9
Appendix I	–	Financial information of the Group . . . . . . . . . . . . .	I-1
Appendix II	–	Accountant’s report of Target Company A. . . . . . . .	II-1
Appendix III	–	Accountant’s report of Target Company B. . . . . . . .	III-1
Appendix IV	–	Accountant’s report of Target Company C . . . . . . .	IV-1
Appendix V	–	Accountant’s report of Target Company D . . . . . . .	V-1
Appendix VI	–	Accountant’s report of Target Company E. . . . . . . .	VI-1
Appendix VII	–	Accountant’s report of Target Company F. . . . . . . .	VII-1
Appendix VIII	–	Management discussion and analysis of
		the Group. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	VIII-1
Appendix IX	–	Management discussion and analysis of
		the Target Companies . . . . . . . . . . . . . . . . . . . . . .	IX-1
Appendix X	–	Pro forma financial information of
		the Enlarged Group. . . . . . . . . . . . . . . . . . . . . . . .	X-1
Appendix XI	–	Property valuation report . . . . . . . . . . . . . . . . . . . . .	XI-1
Appendix XII	–	General information . . . . . . . . . . . . . . . . . . . . . . . . .	XII-1
Notice of SGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			SGM-1

– i –

DEFINITIONS

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

“Acquisitions”
collectively, the Acquisition A, the Acquisition B, the Acquisition C, the Acquisition D, the Acquisition E and the Acquisition F
“Acquisition A” the acquisition of the Equity Interest A and the Sale Loan A by the Bidding Subsidiary from the Seller pursuant to the Equity Transfer Agreement A
“Acquisition B” the acquisition of the Equity Interest B and the Sale Loan B by the Bidding Subsidiary from the Seller pursuant to the Equity Transfer Agreement B
“Acquisition C” the acquisition of the Equity Interest C and the Sale Loan C by the Bidding Subsidiary from the Seller pursuant to the Equity Transfer Agreement C
“Acquisition D” the acquisition of the Equity Interest D and the Sale Loan D by the Bidding Subsidiary from the Seller pursuant to the Equity Transfer Agreement D
“Acquisition E” the acquisition of the Equity Interest E and the Sale Loan E by the Bidding Subsidiary from the Seller pursuant to the Equity Transfer Agreement E
“Acquisition F”
the acquisition of the Equity Interest F and the Sale Loan F by the Bidding Subsidiary from the Seller pursuant to the Equity Transfer Agreement F
“Application Date”
26 June 2015, being the date of submission of the bid by the Bidding Subsidiary in respect of the Acquisitions
“associates”
has the meaning as ascribed to it under the Listing Rules
“Bidding Subsidiary”
南京立方置業有限公司 (Nanjing Lifang Property Company Limited*), a limited company established in the PRC which is indirectly owned as to 80% by the Company
“Board”
the board of Directors

– 1 –

DEFINITIONS

“COAMC” China Orient Asset Management Corporation, a stateowned enterprise set up by the Ministry of Finance of the PRC
“COAMI” China Orient Asset Management (International) Holding Limited, an indirect wholly-owned subsidiary of COAMC
“Company” Shanghai Zendai Property Limited, an exempted company incorporated in Bermuda, the Shares of which are listed on the Stock Exchange
“connected person(s)” has the meaning as ascribed to it under the Listing Rules “Consideration A” RMB543,377,200, being the consideration for the Equity Interest A and the Sale Loan A
“Consideration B” RMB679,498,700, being the consideration for the Equity Interest B and the Sale Loan B
“Consideration C” RMB332,720,700, being the consideration for the Equity Interest C and the Sale Loan C
“Consideration D” RMB1,162,470,300, being the consideration for the Equity Interest D and the Sale Loan D
“Consideration E” RMB797,251,800, being the consideration for the Equity Interest E and the Sale Loan E
“Consideration F” RMB998,290,600, being the consideration for the Equity Interest F and the Sale Loan F
“Directors” the directors of the Company
“Enlarged Group” the Group after completion of the Acquisitions
“Equity Interests” collectively, the Equity Interest A, the Equity Interest B, the Equity Interest C, the Equity Interest D, the Equity Interest E and the Equity Interest F
“Equity Interest A” the entire registered capital of Target Company A
“Equity Interest B” the entire registered capital of Target Company B

– 2 –

DEFINITIONS

“Equity Interest C” the entire registered capital of Target Company C
“Equity Interest D”
“Equity Interest E”

the entire registered capital of Target Company D the entire registered capital of Target Company E

“Equity Interest F”

the entire registered capital of Target Company F

“Equity Transfer Agreements”

collectively, the Equity Transfer Agreement A, the Equity Transfer Agreement B, the Equity Transfer Agreement C, the Equity Transfer Agreement D, the Equity Transfer Agreement E and the Equity Transfer Agreement F, and shall refer to the Equity Transfer Agreements, (or each of them), as amended by the Supplemental Agreement where the context requires

“Equity Transfer Agreement A”
the equity transfer agreement dated 12 August 2015 for the Equity Interest A and the Sale Loan A entered into between the Bidding Subsidiary and the Seller in respect of the Acquisition A
“Equity Transfer Agreement B”
the equity transfer agreement dated 12 August 2015 for the Equity Interest B and the Sale Loan B entered into between the Bidding Subsidiary and the Seller in respect of the Acquisition B
“Equity Transfer Agreement C”
the equity transfer agreement dated 12 August 2015 for the Equity Interest C and the Sale Loan C entered into between the Bidding Subsidiary and the Seller in respect of the Acquisition C
“Equity Transfer Agreement D”
the equity transfer agreement dated 12 August 2015 for the Equity Interest D and the Sale Loan D entered into between the Bidding Subsidiary and the Seller in respect of the Acquisition D
“Equity Transfer Agreement E”
the equity transfer agreement dated 12 August 2015 for the Equity Interest E and the Sale Loan E entered into between the Bidding Subsidiary and the Seller in respect of the Acquisition E

– 3 –

DEFINITIONS

“Equity Transfer Agreement F”
the equity transfer agreement dated 12 August 2015 for the Equity Interest F and the Sale Loan F entered into between the Bidding Subsidiary and the Seller in respect of the Acquisition F
“Group” the Company and its subsidiaries
“HK$”
Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”
the Hong Kong Special Administrative Region of the PRC
“Independent Third Party(ies)”
independent third parties of and not connected with the Company and its connected persons
“Land Parcels” collectively, the Land Parcel A, the Land Parcel B, the Land Parcel C, the Land Parcel D, the Land Parcel E and the Land Parcel F
“Land Parcel A” two pieces of land located at the intersection of Jiangbian Road and Longjiang Road, Gulou District, Nanjing, Jiangsu Province, the PRC with site areas of 9,731.39 sq.m.
“Land Parcel B” a piece of land located at the intersection of Xing’an Road and Longjiang Road, Gulou District, Nanjing, Jiangsu Province, the PRC with a site area of 18,481.60 sq.m.
“Land Parcel C” two pieces of land located at the intersection of Jiangbian Road and Tianxiangli, Gulou District, Nanjing, Jiangsu Province, the PRC with site areas of 14,404.27 sq.m.
“Land Parcel D”
two pieces of land located at the intersection of Jiangbian Road and Jianning Road, Gulou District, Nanjing, Jiangsu Province, the PRC with site areas of 15,565.86 sq.m.
“Land Parcel E” four pieces of land located at the intersection of Zhongyang Road and Jianning Road, Gulou District, Nanjing, Jiangsu Province, the PRC with site areas of 37,071.58 sq.m.

– 4 –

DEFINITIONS

“Land Parcel F”
“Latest Practicable Date”
“Listing Rules”
“Nanjing Land Bureau”
“PRC”
“PRC GAAP”
“Previous Acquisition”
“RMB”
“Sale Loans”
“Sale Loan A”
two pieces of land located at the intersection of south Rehe Road and Shiqiao Street, Gulou District,Nanjing, Jiangsu Province, the PRC with site areas of 15,234.36 sq.m.
22 September 2015, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein
the Rules Governing the Listing of Securities on the Stock Exchange
南京市國土資源局 (Nanjing Bureau of Land and Resources*)
the People’s Republic of China which, for the purpose of this circular, excludes Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan
the Generally Accepted Accounting Principles in the PRC
a prior acquisition of the entire interest of a company with major assets comprised of a piece of land in Nanjing, the PRC by the Group from the Seller which is subject to aggregation with the Acquisitions for determining the percentage ratio(s) pursuant to the Listing Rules, further details of which are set out in the circulars of the Company dated 7 July 2014 and 22 December 2014
Renminbi, the lawful currency of the PRC
collectively, the Sale Loan A, the Sale Loan B, the Sale Loan C, the Sale Loan D, the Sale Loan E and the Sale Loan F
the loan owing by Target Company A to the Seller in the amount of approximately RMB237.46 million (equivalent to approximately HK$287.33 million) as at 27 April 2015 according to the Tender Document

– 5 –

DEFINITIONS

“Sale Loan B” the loan owing by Target Company B to the Seller in the amount of approximately RMB432.80 million (equivalent to approximately HK$523.69 million) as at 27 April 2015 according to the Tender Document
“Sale Loan C” the loan owing by Target Company C to the Seller in the amount of approximately RMB133.24 million (equivalent to approximately HK$161.22 million) as at 27 April 2015 according to the Tender Document
“Sale Loan D” the loan owing by Target Company D to the Seller in the amount of approximately RMB530.01 million (equivalent to approximately HK$641.31 million) as at 27 April 2015 according to the Tender Document
“Sale Loan E” the loan owing by Target Company E to the Seller in the amount of approximately RMB348.31 million (equivalent to approximately HK$421.46 million) as at 27 April 2015 according to the Tender Document
“Sale Loan F” the loan owing by Target Company F to the Seller in the amount of approximately RMB613.97 million (equivalent to approximately HK$742.90 million) as at 27 April 2015 according to the Tender Document
“Seller” 南京臨江老城改造建設投資有限公司 (Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd*), a limited company established in the PRC which holds the Equity Interests and is the beneficial owner of the Sale Loans
“SFO” Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
“SGM”
the special general meeting of the Company to be convened to approve, among other things, the Equity Transfer Agreements and the transactions contemplated thereunder
“Shanghai Assets Exchange” 上海聯合產權交易所 (Shanghai United Assets and Equity Exchange*)
“Shareholder(s)” holder(s) of Shares

– 6 –

DEFINITIONS

“Share(s)”
“sq.m.”
“Stock Exchange”
“Supplemental Agreement”
“Target Companies”
“Target Company A”
“Target Company B”
“Target Company C”
“Target Company D”
“Target Company E”
share(s) of HK$0.02 each in the share capital of the Company
square meters
The Stock Exchange of Hong Kong Limited
the supplemental agreement dated 24 August 2015 entered into between the Bidding Subsidiary and the Seller to amend and supplement the terms of the Equity Transfer Agreements
collectively, Target Company A, Target Company B, Target Company C, Target Company D, Target Company E and Target Company F
南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited*), a company established in the PRC with limited liability, the major asset of which comprises the Land Parcel A
南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited*), a company established in the PRC with limited liability, the major asset of which comprises the Land Parcel B
南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited*), a company established in the PRC with limited liability, the major asset of which comprises the Land Parcel C

南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited*), a company established in the PRC with limited liability, the major asset of which comprises the Land Parcel D

南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited*), a company established in the PRC with limited liability, the major asset of which comprises the Land Parcel E

– 7 –

DEFINITIONS

“Target Company F”

南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited*), a company established in the PRC with limited liability, the major asset of which comprises the Land Parcel F

“Tender Document(s)”
tender document in respect of the Tender released by Shanghai Assets Exchange
“Tender(s)”
the public tender for the Equity Interest A and the Sale Loan A, for the Equity Interest B and the Sale Loan B, for the Equity Interest C and the Sale Loan C, for the Equity Interest D and the Sale Loan D, for the Equity Interest E and the Sale Loan E, and for the Equity Interest F and the Sale Loan F, as the case may be
“US$”
United States dollars, the lawful currency of United States of America
“ZAR”
South Africa rands, the lawful currency of the Republic of South Africa
“%”
per cent

For the purpose of this circular, the exchange rates of RMB1.00 = HK$1.21 have been used for currency translation, where applicable. Such exchange rates are for illustrative purposes and do not constitute representations that any amount in HK$ or RMB has been, could have been or may be converted at such a rate.

– 8 –

LETTER FROM THE BOARD

SHANGHAI ZENDAI PROPERTY LIMITED 上海証大房地產有限公司[*]

(Incorporated in Bermuda with limited liability) (Stock code: 755)

Executive Directors: Mr. Zhang Chenguang (Chairman) Mr. Zhong Guoxing Dr. Wang Hao Ms. Li Li Hua

Registered Office: Canon’s Court 22 Victoria Street Hamilton HM12 Bermuda

Non-executive Directors:

Mr. Xu Xiaoliang Mr. Gong Ping

Independent Non-executive Directors: Mr. Lai Chik Fan Mr. Li Man Wai Mr. Chow, Alexander Yue Nong Dr. Xu Changsheng

Head office and principal place of business in Hong Kong: Unit 6108 The Center 99 Queen’s Road Central Hong Kong

24 September 2015

To the Shareholders,

Dear Sir or Madam,

VERY SUBSTANTIAL ACQUISITION IN RESPECT OF THE ACQUISITIONS OF THE EQUITY INTERESTS AND THE SALE LOANS

INTRODUCTION

The Board announces that, on 12 August 2015 (after trading hours), the Bidding Subsidiary, being a non wholly-owned subsidiary of the Company, and the Seller entered into the Equity Transfer Agreements, pursuant to which the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the Equity Interests of the Target Companies and the Sale Loans, at a total consideration of approximately RMB4,513.61 million (equivalent to approximately HK$5,461.47 million). The major assets of the Target Companies comprise the Land Parcels.

– 9 –

LETTER FROM THE BOARD

On 24 August 2015, the Bidding Subsidiary and the Seller entered into the Supplemental Agreement to amend and supplement certain terms of the Equity Transfer Agreements. In this circular, references to the Equity Transfer Agreements (or each of them) are to the Equity Transfer Agreements (or each of them) as amended by the Supplemental Agreement, where the context requires.

Given one of the applicable percentage ratios (as defined under Rule 14.07 of the Listing Rules) in respect of the Acquisitions, on a stand-alone basis or when aggregated with the Previous Acquisition in accordance with the Listing Rules, exceeds 100%, the Acquisitions constitute a very substantial acquisition for the Company and are subject to the reporting, announcement and shareholders’ approval requirements under Chapter 14 of the Listing Rules.

The purpose of this circular is to provide you with, among other things, (i) details of the Acquisitions; (ii) financial information of the Group and the Target Companies; (iii) valuation reports on the Land Parcels; and (iv) the notice of the SGM.

THE ACQUISITIONS

The Equity Transfer Agreement A

Date : 12 August 2015 (after trading hours)

Parties :

Purchaser/bidder: Bidding Subsidiary Vendor: The Seller

Details of the Acquisition A

Pursuant to the Equity Transfer Agreement A, the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the Equity Interest A of Target Company A and the Sale Loan A.

The Consideration A

The Consideration A of approximately RMB543.38 million (equivalent to approximately HK$657.49 million) for the Equity Interest A and the Sale Loan A shall be satisfied by the Bidding Subsidiary by cash in the manner set out below:

(a) as to the first instalment of 30% of the Consideration A, being approximately RMB163.01 million (equivalent to approximately HK$197.24 million), within five business days upon the Equity Transfer Agreement A becoming effective, where the earnest money of RMB8.00 million (equivalent to approximately HK$9.68 million) paid by the Bidding Subsidiary on the Application Date for participating in the Tender will be applied towards settling part of such instalment; and

– 10 –

LETTER FROM THE BOARD

(b) subject to the obtaining of the delivery confirmations and land title certificates of Land Parcel A, the balance of the Consideration A, being approximately RMB380.37 million (equivalent to approximately HK$460.25 million), within one year upon the entering into of the Equity Transfer Agreement A including the interest incurred therefrom at a bank’s benchmark interest rate for RMB loans of the same term. The Bidding Subsidiary shall provide a legal guarantee for the balance of the Consideration A.

The Consideration A is equivalent to the starting price of the Tender of approximately RMB543.38 million (equivalent to approximately HK$657.49 million), which is arrived at taking into account that (i) the Consideration A is equivalent to the aggregated unaudited adjusted net assets of Target Company A (after the appraisal of the Land Parcel A) of approximately RMB305.92 million (equivalent to approximately HK$370.16 million) and the Sale Loan A of approximately RMB237.46 million (equivalent to approximately HK$287.33 million) as at 27 April 2015 according to the Tender Document; (ii) the preliminary valuation of the Land Parcel A of approximately RMB552.00 million (equivalent to approximately HK$667.92 million) as at 30 June 2015 as assessed by an independent valuer appointed by the Company; and (iii) the Group’s view on the future prospect of the property market in Nanjing, the PRC.

The Equity Transfer Agreement B

Date : 12 August 2015 (after trading hours)

Parties :

Purchaser/bidder: Bidding Subsidiary Vendor: The Seller

Details of the Acquisition B

Pursuant to the Equity Transfer Agreement B, the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the Equity Interest B of Target Company B and the Sale Loan B.

The Consideration B

The Consideration B of approximately RMB679.50 million (equivalent to approximately HK$822.20 million) for the Equity Interest B and the Sale Loan B shall be satisfied by the Bidding Subsidiary by cash in the manner set out below:

(a) as to the first instalment of 30% of the Consideration B, being approximately RMB203.85 million (equivalent to approximately HK$246.66 million), within five business days upon the Equity Transfer Agreement B becoming effective, where the earnest money of RMB8.00 million (equivalent to approximately HK$9.68 million) paid by the Bidding Subsidiary on the Application Date for participating in the Tender will be applied towards settling part of such instalment; and

– 11 –

LETTER FROM THE BOARD

(b) subject to the obtaining of the delivery confirmation and land title certificate of Land Parcel B, the balance of the Consideration B, being approximately RMB475.65 million (equivalent to approximately HK$575.54 million), within one year upon the entering into of the Equity Transfer Agreement B including the interest incurred therefrom at a bank’s benchmark interest rate for RMB loans of the same term. The Bidding Subsidiary shall provide a legal guarantee for the balance of the Consideration B.

The Consideration B is equivalent to the starting price of the Tender of approximately RMB679.50 million (equivalent to approximately HK$822.20 million), which is arrived at taking into account that (i) the Consideration B is equivalent to the aggregated unaudited adjusted net assets of Target Company B (after the appraisal of the Land Parcel B) of approximately RMB246.70 million (equivalent to approximately HK$298.51 million) and the Sale Loan B of approximately RMB432.80 million (equivalent to approximately HK$523.69 million) as at 27 April 2015 according to the Tender Document; (ii) the preliminary valuation of the Land Parcel B of approximately RMB686.00 million (equivalent to approximately HK$830.06 million) as at 30 June 2015 as assessed by an independent valuer appointed by the Company; and (iii) the Group’s view on the future prospect of the property market in Nanjing, the PRC.

The Equity Transfer Agreement C

Date : 12 August 2015 (after trading hours)

Parties :

Purchaser/bidder: Bidding Subsidiary Vendor: The Seller

Details of the Acquisition C

Pursuant to the Equity Transfer Agreement C, the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the Equity Interest C of Target Company C and the Sale Loan C.

The Consideration C

The Consideration C of approximately RMB332.72 million (equivalent to approximately HK$402.59 million) for the Equity Interest C and the Sale Loan C shall be satisfied by the Bidding Subsidiary by cash in the manner set out below:

(a) as to the first instalment of 30% of the Consideration C, being approximately RMB99.82 million (equivalent to approximately HK$120.78 million), within five business days upon the Equity Transfer Agreement C becoming effective, where the earnest money of RMB10.00 million (equivalent to approximately HK$12.10 million) paid by the Bidding Subsidiary on the Application Date for participating in the Tender will be applied towards settling part of such instalment; and

– 12 –

LETTER FROM THE BOARD

(b) subject to the obtaining of the delivery confirmations and land title certificates of Land Parcel C, the balance of the Consideration C, being approximately RMB232.90 million (equivalent to approximately HK$281.81 million), within one year upon the entering into of the Equity Transfer Agreement C including the interest incurred therefrom at a bank’s benchmark interest rate for RMB loans of the same term. The Bidding Subsidiary shall provide a legal guarantee for the balance of the Consideration C.

The Consideration C is equivalent to the starting price of the Tender of approximately RMB332.72 million (equivalent to approximately HK$402.59 million), which is arrived at taking into account that (i) the Consideration C is equivalent to the aggregated unaudited adjusted net assets of Target Company C (after the appraisal of the Land Parcel C) of approximately RMB199.48 million (equivalent to approximately HK$241.37 million) and the Sale Loan C of approximately RMB133.24 million (equivalent to approximately HK$161.22 million) as at 27 April 2015 according to the Tender Document; (ii) the preliminary valuation of the Land Parcel C of approximately RMB343.00 million (equivalent to approximately HK$415.03 million) as at 30 June 2015 as assessed by an independent valuer appointed by the Company; and (iii) the Group’s view on the future prospect of the property market in Nanjing, the PRC.

The Equity Transfer Agreement D

Date : 12 August 2015 (after trading hours)

Parties :

Purchaser/bidder: Bidding Subsidiary Vendor: The Seller

Details of the Acquisition D

Pursuant to the Equity Transfer Agreement D, the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the Equity Interest D of Target Company D and the Sale Loan D.

The Consideration D

The Consideration D of approximately RMB1,162.47 million (equivalent to approximately HK$1,406.59 million) for the Equity Interest D and the Sale Loan D shall be satisfied by the Bidding Subsidiary by cash in the manner set out below: (a) as to the first instalment of 30% of the Consideration D, being approximately RMB348.74 million (equivalent to approximately HK$421.98 million), within five business days upon the Equity Transfer Agreement D becoming effective, where the earnest money of RMB8.00 million (equivalent to approximately HK$9.68 million) paid by the Bidding Subsidiary on the Application Date for participating in the Tender will be applied towards settling part of such instalment; and

– 13 –

LETTER FROM THE BOARD

(b) subject to the obtaining of the delivery confirmations and land title certificates of Land Parcel D, the balance of the Consideration D, being approximately RMB813.73 million (equivalent to approximately HK$984.61 million), within one year upon the entering into of the Equity Transfer Agreement D including the interest incurred therefrom at a bank’s benchmark interest rate for RMB loans of the same term. The Bidding Subsidiary shall provide a legal guarantee for the balance of the Consideration D.

The Consideration D is equivalent to the starting price of the Tender of approximately RMB1,162.47 million (equivalent to approximately HK$1,406.59 million), which is arrived at taking into account that (i) the Consideration D is equivalent to the aggregated unaudited adjusted net assets of Target Company D (after the appraisal of the Land Parcel D) of approximately RMB632.46 million (equivalent to approximately HK$765.28 million) and the Sale Loan D of approximately RMB530.01 million (equivalent to approximately HK$641.31 million) as at 27 April 2015 according to the Tender Document; (ii) the preliminary valuation of the Land Parcel D of approximately RMB1,176.00 million (equivalent to approximately HK$1,422.96 million) as at 30 June 2015 as assessed by an independent valuer appointed by the Company; and (iii) the Group’s view on the future prospect of the property market in Nanjing, the PRC.

The Equity Transfer Agreement E

Date : 12 August 2015 (after trading hours)

Parties :

Purchaser/bidder: Bidding Subsidiary Vendor: The Seller

Details of the Acquisition E

Pursuant to the Equity Transfer Agreement E, the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the Equity Interest E of Target Company E and the Sale Loan E.

The Consideration E

The Consideration E of approximately RMB797.25 million (equivalent to approximately HK$964.67 million) for the Equity Interest E and the Sale Loan E shall be satisfied by the Bidding Subsidiary by cash in the manner set out below:

(a) as to the first instalment of 30% of the Consideration E, being approximately RMB239.18 million (equivalent to approximately HK$289.41 million), within five business days upon the Equity Transfer Agreement E becoming effective, where the earnest money of RMB8.00 million (equivalent to approximately HK$9.68 million) paid by the Bidding Subsidiary on the Application Date for participating in the Tender will be applied towards settling part of such instalment; and

– 14 –

LETTER FROM THE BOARD

(b) subject to the obtaining of the delivery confirmations and land title certificates of Land Parcel E, the balance of the Consideration E, being approximately RMB558.07 million (equivalent to approximately HK$675.26 million), within one year upon the entering into of the Equity Transfer Agreement E including the interest incurred therefrom at a bank’s benchmark interest rate for RMB loans of the same term. The Bidding Subsidiary shall provide a legal guarantee for the balance of the Consideration E.

The Consideration E is equivalent to the starting price of the Tender of approximately RMB797.25 million (equivalent to approximately HK$964.67 million), which is arrived at taking into account that (i) the Consideration E is equivalent to the aggregated unaudited adjusted net assets of Target Company E (after the appraisal of the Land Parcel E) of approximately RMB448.94 million (equivalent to approximately HK$543.22 million) and the Sale Loan E of approximately RMB348.31 million (equivalent to approximately HK$421.46 million) as at 27 April 2015 according to the Tender Document; (ii) the preliminary valuation of the Land Parcel E of approximately RMB815.00 million (equivalent to approximately HK$986.15 million) as at 30 June 2015 as assessed by an independent valuer appointed by the Company; and (iii) the Group’s view on the future prospect of the property market in Nanjing, the PRC.

The Equity Transfer Agreement F

Date : 12 August 2015 (after trading hours)

Parties :

Purchaser/bidder: Bidding Subsidiary Vendor: The Seller

Details of the Acquisition F

Pursuant to the Equity Transfer Agreement F, the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the Equity Interest F of Target Company F and the Sale Loan F.

The Consideration F

The Consideration F of approximately RMB998.29 million (equivalent to approximately HK$1,207.93 million) for the Equity Interest F and the Sale Loan F shall be satisfied by the Bidding Subsidiary by cash in the manner set out below:

(a) as to the first instalment of 30% of the Consideration F, being approximately RMB299.49 million (equivalent to approximately HK$362.38 million), within five business days upon the Equity Transfer Agreement F becoming effective, where the earnest money of RMB8.00 million (equivalent to approximately HK$9.68 million) paid by the Bidding Subsidiary on the Application Date for participating in the Tender will be applied towards settling part of such instalment; and

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LETTER FROM THE BOARD

(b) subject to the obtaining of the delivery confirmations and land title certificates of Land Parcel F, the balance of the Consideration F, being approximately RMB698.80 million (equivalent to approximately HK$845.55 million) within one year upon the entering into of the Equity Transfer Agreement F including the interest incurred therefrom at a bank’s benchmark interest rate for RMB loans of the same term. The Bidding Subsidiary shall provide a legal guarantee for the balance of the Consideration F.

The Consideration F is equivalent to the starting price of the Tender of approximately RMB998.29 million (equivalent to approximately HK$1,207.93 million), which is arrived at taking into account that (i) the Consideration F is equivalent to the aggregated unaudited adjusted net assets of Target Company F (after the appraisal of the Land Parcel F) of approximately RMB384.32 million (equivalent to approximately HK$465.03 million) and the Sale Loan F of approximately RMB613.97 million (equivalent to approximately HK$742.90 million) as at 27 April 2015 according to the Tender Document; (ii) the preliminary valuation of the Land Parcel F of approximately RMB1,006.00 million (equivalent to approximately HK$1,217.26 million) as at 30 June 2015 as assessed by an independent valuer appointed by the Company; and (iii) the Group’s view on the future prospect of the property market in Nanjing, the PRC.

Other principal terms of the Equity Transfer Agreements

In the event that the Bidding Subsidiary fails to make payment for the Acquisitions, the Bidding Subsidiary is liable to a penalty amounting to 0.1% of the part of the consideration not yet paid by the Bidding Subsidiary for each day of breach to the Seller. If the delay is over 180 days, the Seller has the right to terminate the Equity Transfer Agreements and the Seller may claim its loss from the Bidding Subsidiary.

In the event that the Seller fails to complete the registration of the transfer of the Equity Interests and the Sale Loans to the Bidding Subsidiary, the Seller is liable to a penalty amounting to 0.1% of the respective considerations for the Acquisitions for each day of breach to the Bidding Subsidiary. If the delay is over 180 days, the Bidding Subsidiary has the right to terminate the Equity Transfer Agreements and the Bidding Subsidiary may claim its loss from the Seller.

The principal terms of each of the Equity Transfer Agreements are identical, except for the name of the Target Companies, the consideration for the respective Equity Interests and the respective Sale Loans payable by the Bidding Subsidiary and the payment terms thereof.

It is currently expected that the Bidding Subsidiary will finance the payment for the Acquisitions by its internal resources, borrowings from bank(s) or financial institution(s) and/or loans from shareholders of the Bidding Subsidiary.

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LETTER FROM THE BOARD

The Company intends to finance the Acquisitions with the Group’s internal resources, and new borrowings from bank(s) or financial institution(s) of RMB4,513.61 million (equivalent to approximately HK$5,461.47 million). As at the Latest Practicable Date, the Group has received banking facility of RMB2,500 million (equivalent to approximately HK$3,025 million). The Group has also commenced negotiations with other financial institutions and has received offer proposal from a financial institution to provide to the Group a long term loan facility of RMB2,000 million (equivalent to approximately HK$2,420 million). The definitive terms are subject to further negotiations. COAMI, the largest shareholder of the Company, has confirmed to the Company that if the external financing resources cannot be obtained or is not sufficient for the Enlarged Group for the purpose of financing the Acquisitions, it will, at the Company’s request, use reasonable endeavours to procure relevant bank(s) or financial institution(s) to provide a loan for an amount up to RMB2,000 million (equivalent to approximately HK$2,420 million) to the Group to meet any shortfall for such purpose (the “Shareholder’s Undertaking”).

The provision of loan to the Group by such bank(s) or financial institution(s) pursuant to the Shareholder’s Undertaking, if entered into, is expected to be fully exempted under Chapter 14A of the Listing Rules. In the event that the aforesaid transaction materialises and shall constitute a notifiable transaction and/or connected transaction of the Company, the Company will comply with the applicable requirements under Chapter 14 and/or Chapter 14A of the Listing Rules and will issue further announcement(s) relating to the aforesaid transaction in accordance with the Listing Rules as and when appropriate.

As at the Latest Practicable Date, it is the intention of the Group to finance the first instalment of the aggregate consideration for the Acquisitions by the drawdown loan from the existing banking facilities of approximately RMB1,300 million (equivalent to approximately HK$1,573 million).

Conditions precedent for the Equity Transfer Agreements becoming effective

Each of the Equity Transfer Agreements will become effective upon fulfilment of the following conditions precedent:

(a) the approval of the Equity Transfer Agreements and the transaction contemplated thereunder by the Shareholders in accordance with the Listing Rules having been obtained; and
(b) if required, all approvals and consents in relation to the transactions contemplated under the Equity Transfer Agreements having been obtained from relevant governmental authorities and regulatory bodies.

If the conditions precedent to the effectiveness of the Equity Transfer Agreements set out in paragraphs (a) and (b) above could not be fulfilled within six months after 12 August 2015 (or such other later date as the parties may agree in writing), the Equity Transfer Agreements shall cease and terminate. In the event that the aforesaid conditions precedent could not be fulfilled within six months after 12 August 2015 and that the failure of the Equity Transfer Agreements becoming effective is not due to the default of the Seller, the Seller will not refund the deposit paid by the Bidding Subsidiary.

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LETTER FROM THE BOARD

In the event that the delivery confirmations and land title certificates of the Land Parcels cannot be obtained by the Target Companies within one year after 12 August 2015 (or such other date as the parties may agree in writing), the Equity Transfer Agreements shall terminate. Upon such termination, the Seller shall refund all the consideration already paid by the Bidding Subsidiary without interest (including but not limited to the first instalment of 30% of the total consideration including the deposit) to the Bidding Subsidiary within 180 days after the termination of the Equity Transfer Agreements and the Bidding Subsidiary shall as soon as possible complete the change of registration of the relevant Target Companies. The Equity Interests and the Sale Loans shall be transferred from the Bidding Subsidiary to the Seller.

Upon the Equity Transfer Agreements becoming effective

It is expected that the registration of the transfer of the Equity Interests will take place within 10 business days after receipt of the certificate in respect of the transfer of the Equity Interests, which will be issued by Shanghai Assets Exchange upon the payment of the first instalment of 30% of the total consideration by the Bidding Subsidiary. Upon completion of the registration of the transfer of the Equity Interests, the Target Companies will be treated as subsidiaries of the Company.

Within 10 business days after payment of the 30% of the total consideration and receipt of the certificate in respect of the transfer of the Equity Interests and the Sale Loans issued by the Shanghai Assets Exchange, the Seller shall cooperate with the Bidding Subsidiary in the obtaining of the relevant delivery confirmations and land title certificates of the Land Parcels. The originals of the delivery confirmations and the land title certificates of the Land Parcels will be kept by the Seller and will be available for inspection by authorised representatives of the Bidding Subsidiary. The Bidding Subsidiary shall pay the Seller the remaining 70% of the consideration for the respective Equity Interests and Sale Loans within 10 business days after the obtaining of relevant delivery confirmations and the land title certificates of the Land Parcels and the Seller shall simultaneously provide the originals of the delivery confirmations and the land title certificates of the Land Parcels to the Bidding Subsidiary.

INFORMATION ON THE SELLER, THE TARGET COMPANIES AND THE LAND PARCELS

Information on the Seller

According to the Tender Documents released by Shanghai Assets Exchange, the business scope of the Seller includes real estate development in the PRC. To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, the Seller and its ultimate beneficial owners are Independent Third Parties. According to the Tender Documents released by Shanghai Assets Exchange, the Seller holds the Equity Interests and is the beneficial owner of the Sale Loans.

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LETTER FROM THE BOARD

Information on the Target Companies

The Target Companies comprise (i) Target Company A; (ii) Target Company B; (iii) Target Company C; (iv) Target Company D; (v) Target Company E; and (vi) Target Company F. The information of each Target Company is set out as below:

Target Company A

According to the Tender Document, Target Company A is a limited company established in Nanjing, the PRC, on 22 May 2014. Target Company A is an investment holding company with business scope including property development and management, the major asset of which is the Land Parcel A. The Land Parcel A comprises two pieces of land located at Gulou District, Nanjing, the PRC, with a site area of 2,998.52 sq.m. and 6,732.87 sq.m. respectively, which are both designated for commercial, office and service apartment use. The land use rights of the Land Parcel A has been granted for a term of 40 years for commercial and 50 years (statutory maximum land use term) for office and 65 years for hotel type apartment uses respectively, from the date of delivery of the Land Parcel A by Nanjing Land Bureau to Target Company A.

According to the Tender Document, Target Company A has not yet commenced its operation nor recorded any profit or loss since its establishment. According to the audited financial report of Target Company A prepared under PRC GAAP disclosed in the Tender Document, the audited net assets of Target Company A amounted to approximately RMB20.00 million as at 27 April 2015 and the unaudited adjusted net assets of Target Company A after the appraisal of the Land Parcel A as at 27 April 2015 amounted to approximately RMB305.92 million. According to the Tender Document, Sale Loan A amounted to approximately RMB237.46 million as at 27 April 2015. Further details of the financial information of Target Company A are set out in the Appendix II to this circular.

Target Company B

According to the Tender Document, Target Company B is a limited company established in Nanjing, the PRC, on 13 February 2014. Target Company B is an investment holding company with business scope including property development and management, the major asset of which is the Land Parcel B. The Land Parcel B is located at Gulou District, Nanjing, the PRC, with a site area of 18,481.60 sq.m., which is designated for commercial and financial use. The land use rights of the Land Parcel B has been granted for a term of 40 years for commercial and financial uses, from the date of delivery of the Land Parcel B by Nanjing Land Bureau to Target Company B.

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LETTER FROM THE BOARD

The key financial information of Target Company B for the period commencing on the date of the establishment of Target Company B, i.e. 13 February 2014, up to 27 April 2015 as extracted from the relevant audited financial report of Target Company B prepared under PRC GAAP disclosed in the Tender Document are shown as below:

For the period from 13 February 2014 (date of establishment For the period from of Target Company B) 1 January 2015 to to 31 December 2014 27 April 2015 RMB RMB Net profit/(loss) before tax 20,044.30 (14.31) Net profit/(loss) after tax 15,033.22 (14.31)

The net profit before tax for the period from 13 February 2014 to 31 December 2014 is attributable by the interest income as a result of an increase in bank balance due to the shareholder’s capital contribution to be used for the payment of the registered capital of the Target Company B and the net loss for the period from 1 January 2015 to 27 April 2015 is due to the administrative expense incurred during the period. As at 27 April 2015, the audited net assets of Target Company B amounted to approximately RMB20.02 million and the unaudited adjusted net assets of Target Company B after the appraisal of the Land Parcel B as at 27 April 2015 amounted to approximately RMB246.70 million. According to the Tender Document, the Sale Loan B amounted to approximately RMB432.80 million as at 27 April 2015. Further details of the financial information of Target Company B are set out in the Appendix III to this circular.

Target Company C

According to the Tender Document, Target Company C is a limited company established in Nanjing, the PRC, on 22 May 2014. Target Company C is an investment holding company with business scope including property development and management, the major asset of which is the Land Parcel C. The Land Parcel C comprises two pieces of land located at Gulou District, Nanjing, the PRC, with a site area of 4,859.05 sq.m. and 9,545.22 sq.m. respectively, which are designated for culture and entertainment use, and commercial, office and service apartment use, respectively. The land use rights of the Land Parcel C has been granted for a term of 40 years for culture, entertainment, commercial and 50 years for office and 65 years (statutory maximum land use term) for hotel type apartment uses respectively, from the date of delivery of the Land Parcel C by Nanjing Land Bureau to Target Company C.

According to the Tender Document, Target Company C has not yet commenced its operation nor recorded any profit or loss since its establishment. According to the audited financial report of Target Company C prepared under PRC GAAP disclosed in the Tender Document, the audited net assets of Target Company C amounted to approximately RMB20.00 million as at 27 April 2015 and the unaudited adjusted net assets of Target Company C after

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LETTER FROM THE BOARD

the appraisal of the Land Parcel C as at 27 April 2015 amounted to approximately RMB199.48 million. According to the Tender Document, the Sale Loan C amounted to approximately RMB133.24 million as at 27 April 2015. Further details of the financial information of Target Company C are set out in the Appendix IV to this circular.

Target Company D

According to the Tender Document, Target Company D is a limited company established in Nanjing, the PRC, on 22 May 2014. Target Company D is an investment holding company with business scope including property development and management, the major asset of which is the Land Parcel D. The Land Parcel D comprises two pieces of land located at Gulou District, Nanjing, the PRC, with a site area of 9,059.62 sq.m. and 6,506.24 sq.m. respectively, which are both designated for commercial, office and service apartment use. The land use rights of the Land Parcel D has been granted for a term of 40 years for commercial and 50 years for office and 65 years (statutory maximum land use term) for hotel type apartment uses respectively, from the date of delivery of the Land Parcel D by Nanjing Land Bureau to Target Company D.

According to the Tender Document, Target Company D has not yet commenced its operation nor recorded any profit or loss since its establishment. According to the audited financial report of Target Company D prepared under PRC GAAP disclosed in the Tender Document, the audited net assets of Target Company D amounted to approximately RMB20.00 million as at 27 April 2015 and the unaudited adjusted net assets of Target Company D after the appraisal of the Land Parcel D as at 27 April 2015 amounted to approximately RMB632.46 million. According to the Tender Document, the Sale Loan D amounted to approximately RMB530.01 million as at 27 April 2015. Further details of the financial information of Target Company D are set out in the Appendix V to this circular.

Target Company E

According to the Tender Document, Target Company E is a limited company established in Nanjing, the PRC, on 22 May 2014. Target Company E is an investment holding company with business scope including property development and management, the major asset of which is the Land Parcel E. The Land Parcel E comprises four pieces of land located at Gulou District, Nanjing, the PRC, with a site area of 7,668.76 sq.m., 9,058.86 sq.m., 17,357.93 sq.m. and 2,986.03 sq.m. respectively, which are all designated for commercial, office and service apartment use. The land use rights of the Land Parcel E has been granted for a term of 40 years for commercial and 50 years for office and 65 years (statutory maximum land use term) for hotel type apartment uses respectively, from the date of delivery of the Land Parcel E by Nanjing Land Bureau to Target Company E.

According to the Tender Document, Target Company E has not yet commenced its operation nor recorded any profit or loss since its establishment. According to the audited financial report of Target Company E prepared under PRC GAAP disclosed in the Tender Document, the audited net assets of Target Company E amounted to approximately RMB20.00 million as at 27 April 2015 and the unaudited adjusted net assets of Target Company E after

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the appraisal of the Land Parcel E as at 27 April 2015 amounted to approximately RMB448.94 million. According to the Tender Document, the Sale Loan E amounted to approximately RMB348.31 million as at 27 April 2015. Further details of the financial information of Target Company E are set out in the Appendix VI to this circular.

Target Company F

According to the Tender Document, Target Company F is a limited company established in Nanjing, the PRC, on 13 February 2014. Target Company F is an investment holding company with business scope including property development and management, the major asset of which is the Land Parcel F. The Land Parcel F comprises two pieces of land located at Gulou District, Nanjing, the PRC, with a site area of 7,197.57 sq.m. and 8,036.79 sq.m. respectively, which are both designated for commercial and office mixed use. The land use rights of the Land Parcel F has been granted for a term of 40 years for commercial and 50 years for office uses respectively, from the date of delivery of the Land Parcel F by Nanjing Land Bureau to Target Company F.

The key financial information of Target Company F for the period commencing on the date of the establishment of Target Company F, i.e. 13 February 2014, up to 27 April 2015 as extracted from the relevant audited financial report of Target Company F prepared under PRC GAAP disclosed in the Tender Document are shown as below:

			For the period from
			13 February 2014
			(date of establishment	For the period from
			of Target Company F)	1 January 2015 to 27
			to 31 December 2014	April 2015
			RMB	RMB
Net	profit/(loss)	before tax	19,265.84	(14.99)
Net	profit/(loss)	after tax	14,449.38	(14.99)

The net profit before tax for the period from 13 February 2014 to 31 December 2014 is attributable by the interest income as a result of an increase in bank balance due to the shareholder’s capital contribution to be used for the payment of the registered capital of the Target Company F and the net loss for the period from 1 January 2015 to 27 April 2015 is due to the administrative expense incurred during the period. As at 27 April 2015, the audited net assets of Target Company F amounted to approximately RMB20.01 million and the unaudited adjusted net assets of Target Company F after the appraisal of the Land Parcel F as at 27 April 2015 amounted to approximately RMB384.32 million. According to the Tender Document, the Sale Loan F amounted to approximately RMB613.97 million as at 27 April 2015. Further details of the financial information of Target Company F are set out in the Appendix VII to this circular.

Information on the Land Parcels

The Land Parcels, comprising a total of 13 pieces of lands, are located in close proximity in the Gulou District, Nanjing, the PRC, and cover a total site area of approximately 110,489.06 sq.m. with planned above-ground space in the gross floor area of approximately

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LETTER FROM THE BOARD

429,507.00 sq.m.. It is expected that the Land Parcels will be developed into a mixed-use zone comprising hotel and apartments, commercial, office and cultural and entertainment space. The following map shows the location of the Land Parcels in the Gulou District, Nanjing, the PRC:

==> picture [422 x 439] intentionally omitted <==

Pursuant to the Tender Documents, the Nanjing Ministry of Finance has issued receipts in respect of all the land premium (土地出讓金) for the acquisition of the land use rights of the Land Parcels, and each Target Company is entitled to apply to Nanjing Land Bureau for issue of land title certificates (國有土地使用權證) accordingly.

As at the Latest Practicable Date, the Target Companies have not yet obtained the land title certificates of the respective Land Parcels. As advised by the PRC legal advisers, Dacheng Law Offices, pursuant to the land grant contracts (as supplemented by supplemental agreements) in respect of the grant of the Land Parcels by Nanjing Land Bureau, the Target Companies are the grantee of the respective Land Parcels. After payments of all the land premium, which have been made in April and May 2015 by the Target Companies respectively,

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and upon Nanjing Land Bureau having completed any demolition work on the Land Parcels, Nanjing Land Bureau should deliver each of the Land Parcels as a vacant site to the Target Companies, and within 30 days from such delivery, the Target Companies can apply to Nanjing Land Bureau for issue of land title certificates.

As further advised by the PRC legal advisers, upon the Target Companies having submitted the application for the registration of ownership and the land title certificates of the Land Parcels pursuant to the terms of the land grant contracts (as supplemented by supplemental agreements) in respect of the grant of the Land Parcels and to applicable laws and administrative laws, and that Nanjing Land Bureau or its subordinate authorities having completed the registration of ownership of the Land Parcels according to normal practice, there should be no material legal impediment or obstacle for the Target Companies to obtain such land title certificates. After obtaining the relevant land title certificates of the Land Parcels, the Target Companies shall legally own the land use rights of the Land Parcels, and shall be entitled to develop, occupy, use or otherwise dispose of the Land Parcels. It is expected that the land title certificates of the Land Parcels will be issued by the Nanjing Land Bureau within one year upon the entering into of the Equity Transfer Agreements.

REASONS FOR THE ACQUISITIONS

The Group is principally engaged in the development of commercial and residential properties for sale and ownership, investment and operation of hotel business, leasing, management and agency of commercial and residential properties in the PRC. The Group currently has development projects in 12 cities in the PRC which are in northern China and the Yangtze River Delta Economic Region as dominated by Shanghai city, as well as the overseas real estate development projects.

Due to the further implementation of the urbanisation policy and the continuous growth in seeking home upgrade in the first-tier and second-tier cities in the PRC, it is expected that the demand for the mid-to-high end property market would rise accordingly. The Group will take root in Shanghai and Nanjing cities, while harboring the key regions in order to capture the profit growth from the regional upgrade. In addition, since “Nanjing Himalayas Center” and “Nanjing Riverside Thumb Plaza”, the core development projects of the Group in Nanjing, the PRC, has commenced pre-sale and is expected to commence pre-sale in 2015 respectively, it is the intention of the Company to maintain the stable supply and delivery of the property projects of the Group in the future, with a view to modifying the development strategy and launching properties which can cater for market needs.

The Land Parcels, covering a total site area of approximately 110,489.06 sq.m., are located in the Gulou District, being one of the core districts of Nanjing, the capital of Jiangsu Province, the PRC. In recent years, the Gulou District municipal government has been constantly undergoing a wide range of economic reforms to expedite the urban development. Given the unique location and the economic prospects of the Land Parcels, the Group plans to develop the Land Parcels into a mixed-use zone comprising hotel and apartments, commercial, office and cultural and entertainment space. In view of the Group’s extensive experience in

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LETTER FROM THE BOARD

developing large-scale integrated complex in the PRC, the Board is confident that the Land Parcels will be another landmark development in the PRC and considers that the Acquisitions represent good investment opportunities for the Group to further increase its land reserve in the PRC region and enhance Shareholders’ value.

The Directors (excluding Mr. Xu Xiaoliang, Mr. Gong Ping and Mr. Chow, Alexander Yue Nong) are of the opinion that the terms of the Equity Transfer Agreements and the transactions contemplated thereunder are normal commercial terms, fair and reasonable and the Acquisitions are in the interests of the Company and the Shareholders as a whole.

EFFECTS ON EARNINGS AND ASSETS AND LIABILITIES OF THE GROUP

Upon completion of the Acquisitions, the Target Companies will become indirectly owned as to 80% by the Company and their financial results will be consolidated into the financial results of the Group.

It is expected that the Acquisitions will have the following financial effects on the Group:

Assets and liabilities

The unaudited consolidated total assets and total liabilities of the Group as at 30 June 2015 as extracted from the interim report of the Company for the six months ended 30 June 2015 were approximately HK$22,578.50 million and approximately HK$16,874.81 million respectively. Based on the unaudited pro forma financial information of the Enlarged Group as set out in the Appendix X to this circular, assuming completion of the Acquisitions had taken place on 30 June 2015, the pro forma total assets and total liabilities of the Enlarged Group would have been approximately HK$28,219.36 million and approximately HK$22,515.67 million respectively. Therefore, the Acquisitions have no impact on the net assets of the Enlarged Group.

Earnings

The unaudited net loss of the Group for the period ended 30 June 2015 as extracted from the interim report of the Company for the six months ended 30 June 2015 was approximately HK$557.67 million. Based on the unaudited pro forma financial information of the Enlarged Group as set out in the Appendix X to this circular, assuming completion of the Acquisitions had taken place on 1 January 2015, the pro forma net loss of the Enlarged Group would have been approximately HK$557.67 million. It is expected that the impact of the Acquisitions on the Group’s earning will be minimal in the short term. In view of the future prospects of the property market in Nanjing, the PRC, it is anticipated that the Acquisitions will improve the Enlarged Group’s trading prospects in the future.

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LETTER FROM THE BOARD

IMPLICATIONS UNDER THE LISTING RULES

To the best of the knowledge, information and belief of the Directors, after having made all reasonable enquiries, none of the Shareholders have a material interest in the Equity Transfer Agreements and the transactions contemplated thereunder. No Shareholder is required to abstain from voting on the resolution(s) to approve the Equity Transfer Agreements and the transactions contemplated thereunder at the SGM.

SGM

The SGM will be held at Unit A, 29/F, Admiralty Center I, 18 Harcourt Road, Hong Kong on Tuesday, 13 October 2015 at 10:30 a.m. the notice of which is set out on pages SGM-1 to SGM-2 of this circular, for the Shareholders to consider and, if thought fit to approve, the Equity Transfer Agreements and the transactions contemplated thereunder.

Whether or not you intend to attend and vote at such meeting, you are requested to complete and return the enclosed form of proxy to the Company’s branch share registrar in Hong Kong, Tricor Secretaries Limited at Level 22, Hopewell Center, 183 Queen’s Road East, Wanchai, Hong Kong in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the SGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM or any adjournment thereof should you so wish.

RECOMMENDATION

Having considered the reasons set out herein, the Directors (excluding Mr. Xu Xiaoliang, Mr. Gong Ping and Mr. Chow, Alexander Yue Nong) are of the view that the Equity Transfer Agreements and the transactions contemplated thereunder are on normal commercial terms, fair and reasonable and in the interests of the Company and the Shareholders as a whole. Therefore, the Directors (excluding Mr. Xu Xiaoliang, Mr. Gong Ping and Mr. Chow, Alexander Yue Nong) recommend the Shareholders to vote in favour of the relevant resolution(s) to be proposed at the SGM.

The Directors wish to inform the Shareholders that Smart Success Capital Ltd., a substantial Shareholder having a 48.16% interest in the Shares of the Company and indirectly controlled by COAMI, has confirmed to the Company that it will vote in favour of the Acquisitions.

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LETTER FROM THE BOARD

ADDITIONAL INFORMATION

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

By Order of the Board Shanghai Zendai Property Limited Li Li Hua Director

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. FINANCIAL INFORMATION OF THE GROUP

Details of the financial information of the Group for the financial years ended 31 December 2012, 2013 and 2014, and the six months ended 30 June 2015 are disclosed on pages 52-169 of the annual report of the Company for the financial year ended 31 December 2012 published on 21 April 2013, on pages 48-163 of the annual report of the Company for the financial year ended 31 December 2013 published on 30 April 2014, on pages 46-159 of the annual report of the Company for the financial year ended 31 December 2014 published on 30 April 2015 and on pages 2-27 of the interim report of the Company for the six months ended 30 June 2015 published on 18 September 2015. All of these financial statements have been published on the website of the Stock Exchange at www.hkexnews.hk and the Company’s website at www.zendai.com.

2. INDEBTEDNESS STATEMENT

Borrowings

As at the close of business on 31 July 2015, being the latest practicable date for the purpose of this schedule of borrowings prior to printing of this circular, the Enlarged Group had outstanding borrowings of approximately HK$12,503,902,000, details of which are set out below:

	HK$’000
Borrowings and loans
– current
– unsecured	747,757
– secured	3,841,837
– non-current, secured	4,806,954
Amount due to a joint venture, unsecured	1,730,077
Amount due to a third party, unsecured	31,780
Amounts due to minority owners of subsidiaries
– unsecured	27,617
– secured	865,487
Liabilities of disposal group classified as held for sale
– amount due to minority owners of subsidiaries, secured	452,393

Securities

As at 31 July 2015, property, plant and equipment of approximately HK$585,950,000, payment for leasehold land held for own use under operating leases of approximately HK$605,168,000, investment properties of approximately HK$2,382,443,000, properties under development and for sales of approximately HK$2,560,162,000 and bank deposits of approximately HK$1,632,786,000 were pledged to secure certain borrowings granted to the Enlarged Group.

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

Contingent liabilities

As at 31 July 2015, the Enlarged Group provided guarantees to the extent of approximately HK$307,790,000 to banks in respect of mortgage loans provided by the banks to customers for the purchase of the developed properties of the Enlarged Group, net of mortgages received and included in receipts in advance from customers. These guarantees provided by the Enlarged Group to the banks would be released upon receiving the building ownership certificates of the respective properties by the banks from the customers as a pledge for security to the mortgage loans granted.

As at 31 July 2015, the Enlarged Group provided guarantees on certain borrowings of its joint ventures amounting to HK$984,546,000.

Referring to the paragraph under the heading “Litigation” in Appendix XII, in case the Appeal is unsuccessful, the equity interests of Shanghai Zendai Wudaokou would revert to the Group and the previously received consideration which amounted to RMB2,860,000,000 (equivalent to HK$3,564,000,000) may need to be paid back to the Wudaokou Purchaser.

Save as aforesaid, and apart from intra-group liabilities and normal trade and other payables, the Enlarged Group did not have any loan capital issued or agreed to be issued, debt securities issued and outstanding, authorised or otherwise created but unissued, term loans, other borrowings or indebtedness including bank overdrafts, liabilities under acceptances, acceptance credits, debentures, mortgages, charges, finance lease or hire purchase commitments, guarantees or other material contingent liabilities outstanding at the close of business on 31 July 2015.

3. WORKING CAPITAL

Taking into account (i) the expected completion and considerations payment dates of the Acquisitions, (ii) the financial resources available to the Enlarged Group, including the internally generated funds and the available banking facilities, and (iii) the Shareholder’s Undertaking, the Directors, after due and careful enquiry, are of the opinion that the Enlarged Group will have sufficient working capital for its present requirements for at least the next 12 months from the date of this circular.

4. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, save for the increase in loss attributable to owners of the Company for the six months ended 30 June 2015 as mentioned in the profit warning announcement dated 18 August 2015, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 December 2014 (being the date to which the latest published audited consolidated financial statements of the Group were made up).

– I-2 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

5. FINANCIAL AND TRADING PROSPECTS OF THE ENLARGED GROUP

Following completion of the Acquisitions, the Enlarged Group will continue to focus on the key regional development, investment and management of commercial and residential properties, which consist of various integrated commercial complex, grade A office buildings and residential buildings in the first tier cities such as Shanghai and Nanjing as well as second tier cities which are suitable for development in the PRC.

In the first half of 2015, with the continuous and steady growth of the economy and the policy of promoting urbanisation by the central government, the People’s Bank of China cut interest rates for a number of times and eased rules on loans to form a loose market environment, together with measures of policies such as the cancellation of restrictions on property purchases which commenced in 2014, it is expected that the housing market will gradually gain a recovery momentum.

The development strategy of the Group was further affirmed upon COAMI gaining control over the Group. The Group will actively adjust its development strategy to gradually withdraw from the third and fourth tier cities while maintaining adequate land bank. The Group will also continue to expand its land bank in the first and second tier cities in the future to maintain sustained and healthy development. In addition, the Company will seek to continue to develop suitable projects through cooperation to explore capital resources, reduce capital investment at early stage and facilitate projects development. The management remains cautiously optimistic on the long-term prospects of the industry and will quicken the development and sales of its development projects through making use of its own advantages and leveraging on the national network and business resources of COAMI. The synergistic effect brought by COAMI will improve the position of the Group in the real estate industry in China.

In addition, with the help of the business network, capital strength and state-owned enterprise background of COAMI, the Company will be able to acquire quality land resources, achieve more reasonable construction cost and obtain opportunities for more projects. In addition, the Company will seek lower financing costs and diversified financing channels with the help of COAMI’s advantages as a comprehensive finance platform and good credit background as a state-owned enterprise.

“Nanjing Himalayas Center” and “Nanjing Riverside Thumb Plaza”, the core development projects of the Group in Nanjing, the PRC, has commenced pre-sale and is expected to commence pre-sale in 2015 respectively and have contributed to the contracted sales. In overseas market, Modderfontein New City Smart City Project in Johannesburg, South Africa has commenced construction in April 2014, and is currently under smooth progress.

– I-3 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

Looking ahead, the management, by focusing on its developments in the first and some second tier cities which are suitable for development in China, plans to maximise its profits by consolidating the existing real estate development projects and land bank of the Company, speeding up the disposal of non-core projects, developing its existing regions in greater effort in major strategic areas such as Shanghai and Nanjing, etc., fully exploring the local market demands and reducing construction cost and management fees. At the same time, the Group will seize the market share through making the best use of its brand awareness in local markets, so as to improve the Group’s value and earning returns.

– I-4 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

The following is the text of a report received from the Company’s reporting accountant, PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, for the purpose of incorporation in this circular.

24 September 2015

The Directors

Shanghai Zendai Property Limited

Dear Sirs,

We report on the financial information of Nanjing Himalayas Real Estate Company Limited (南京喜瑪拉雅置業有限公司, “Target Company A”), which comprises the balance sheets of Target Company A as at 31 December 2014 and 30 June 2015, and the income statements, the statements of comprehensive income, the statements of changes in equity and the cash flow statements of Target Company A for the period from 22 May 2014 (date of establishment) to 31 December 2014 and the six months ended 30 June 2015 (the “Relevant Periods”) and a summary of significant accounting policies and other explanatory information. This financial information has been prepared by the directors of Shanghai Zendai Property Limited (the “Company”) and is set out in Sections I to III below for inclusion in Appendix II to the circular of the Company dated 24 September 2015 (the “Circular”) in connection with the proposed acquisition of Target Company A by the Company (the “Transaction”).

Target Company A was incorporated in the People’s Republic of China (the “PRC”) on 22 May 2014 as a limited liability company under the Company Law of the PRC.

No audited financial statements have been prepared by the Target Company A as it has not been involved in any business transactions since its date of incorporation till 31 December 2014. The directors of Target Company A during the Relevant Periods are responsible for the preparation and fair presentation of the financial statements in accordance with the Accounting Standards for Business Enterprises of the People’s Republic of China (“CAS”) issued by the China Ministry of Finance, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

The financial information has been prepared based on the unaudited financial statements of Target Company A with no adjustment made thereon.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL INFORMATION

The directors of the Company are responsible for the preparation of the financial information that gives a true and fair view in accordance with Hong Kong Financial Reporting Standards (“HKFRSs”) issued by the Hong Kong Institute of Certified Public Accountants (the “HKICPA”) and accounting policies adopted by the Company as set out in the annual report of the Company for the year ended 31 December 2014.

– II-1 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

REPORTING ACCOUNTANT’S RESPONSIBILITY

Our responsibility is to express an opinion on the financial information and to report our opinion to you. We carried out our procedures in accordance with the Auditing Guideline 3.340 “Prospectuses and the Reporting Accountant” issued by the HKICPA.

OPINION

In our opinion, the financial information gives, for the purpose of this report, a true and fair view of the state of affairs of Target Company A as at 31 December 2014 and 30 June 2015 and of Target Company A’s results and cash flows for the Relevant Periods then ended.

REVIEW OF STUB PERIOD COMPARATIVE FINANCIAL INFORMATION

We have reviewed the stub period comparative financial information set out in Section I to II below included in Appendix II to the Circular which comprises the income statement, the statement of comprehensive income, the statement of changes in equity and the cash flow statement of Target Company A for the period from 22 May 2014 to 30 June 2014 and a summary of significant accounting policies and other explanatory information (the “Stub Period Comparative Financial Information”).

The directors of the Company are responsible for the preparation and presentation of the Stub Period Comparative Financial Information in accordance with the accounting policies set out in Note 3 of Section II below and the accounting policies adopted by the Company as set out in the annual report of the Company for the year ended 31 December 2014.

Our responsibility is to express a conclusion on the Stub Period Comparative Financial Information based on our review. We conducted our review in accordance with Hong Kong Standard on Review Engagements 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the HKICPA. A review of Stub Period Comparative Financial Information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Based on our review, nothing has come to our attention that causes us to believe that the Stub Period Comparative Financial Information, for the purpose of this report and presented on the basis set out in Note 2 of Section II below, is not prepared, in all material respects, in accordance with the accounting policies set out in Note 3 of Section II below.

– II-2 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

I. FINANCIAL STATEMENTS OF TARGET COMPANY A

The following is the financial information of Target Company A prepared by the directors of the Company as at 31 December 2014 and 30 June 2015, and for the period from 22 May 2014 (date of establishment) to 31 December 2014, the six months ended 30 June 2015 and the period from 22 May 2014 to 30 June 2014 (the “Financial Information”):

(A) BALANCE SHEETS

Note Assets Current assets Land use rights 6 Total current assets Total assets Equity Paid-in capital Total equity Liabilities Current liabilities Amounts due to a related party 7 Total current liabilities Total liabilities Total equity and liabilities Net current assets Total assets less current liabilities	As at 31 December 2014 RMB’000 – – – – – – – – – – –	As at 30 June 2015 RMB’000 257,460
		257,460
		257,460

		20,000
		20,000
		237,460
		237,460
		237,460
		257,460

		20,000

		20,000

– II-3 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

(B) INCOME STATEMENTS

Operating profit Profit before income tax Income tax expense Profit for the period Attributable to: Owner of Target Company A	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – –	Six months ended 30 June 2015 RMB’000 – – – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

			–

(C) STATEMENTS OF COMPREHENSIVE INCOME

Profit for the period Total comprehensive income for the period Attributable to: Owner of Target Company A	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–

			–

– II-4 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

(D) STATEMENT OF CHANGES IN OWNERS’ EQUITY

As at 22 May 2014 As at 31 December 2014 As at 1 January 2015 Transactions with owners Capital contribution Total transactions with owners As at 30 June 2015 (unaudited) As at 22 May 2014 As at 30 June 2014	Attributable to owner of Target Company A Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – – – – – – 20,000 – – 20,000 20,000 – – 20,000 20,000 – – 20,000 Attributable to owner of Target Company A Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – –	Total equity RMB’000 –
		–

		–
		20,000
		20,000
		20,000

		Total equity RMB’000 –
		–

– II-5 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

(E) CASH FLOW STATEMENTS

Item Note Cash flows from operating activities Cash used in operations 8 Net cash used in operating activities Cash flows from financing activities Capital contribution received from owner Net cash generated from financing activities Net increase in cash Cash at beginning of the period Cash at end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – – – –	Six months ended 30 June 2015 RMB’000 (20,000) (20,000) 20,000 20,000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–
			–
			–
			– –
			–

– II-6 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

II. NOTES TO THE FINANCIAL INFORMATION

1 GENERAL INFORMATION

Nanjing Himalayas Real Estate Company Limited (“Target Company A”) was incorporated with limited liability in the PRC on 22 May 2014. The address of its registered office is No. 550 Zhongshan North Road, Gulou District, Nanjing, Jiangsu Province, the PRC.

Target Company A is principally engaged in property development services in the PRC.

These financial statements are presented in Renminbi (“RMB”), unless otherwise stated.

These financial statements have been approved for issue by the Board of Directors on 24 September 2015.

2 BASIS OF PREPARATION

The Financial Information has been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by Hong Kong Institute of Certified Public Accountants (“HKICPA”).

The Financial Information has been prepared under the historical cost convention.

HKFRS 1, First-time adoption of Hong Kong Financial Reporting Standards, has been applied in preparing these financial statements. As disclosed in Note 10, Target Company A has consistently applied the accounting policies used in the preparation of its opening HKFRS balance sheet at 31 December 2014 throughout all periods presented. Note 10 discloses the impact of adoption of HKFRS on Target Company A’s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in Target Company A’s financial statements prepared under Accounting Standards for Business Enterprises of the PRC (“CAS”).

Standards, amendments to standards and interpretations that are effective during the Relevant Periods have been adopted and applied by Target Company A consistently throughout the Relevant Periods.

There were no assets, equity or liabilities for Target Company A as at 22 May 2014 (date of establishment).

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below.

3.1 Changes in accounting policy and disclosures

New standards and interpretations not yet adopted

A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2015, and have not been applied in preparing financial statement. None of these is expected to have a significant effect on the financial statements of Target Company A, except the following set out below:

HKFRS 9, ‘Financial instruments’, addresses the classification, measurement and recognition of financial assets and financial liabilities. The complete version of HKFRS 9 was issued in July 2014. It replaces the guidance in HKAS 39 that relates to the classification and measurement of financial instruments. HKFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortised cost, fair value through OCI and fair value through P&L. The basis of classification depends on the entity’s business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are required to be measured at fair value through profit or loss with the irrevocable option at inception to present changes in fair value in OCI not recycling. There is now a new expected credit losses model that replaces the incurred loss impairment model used in HKAS 39. For financial liabilities there were no changes to classification and measurement except for the recognition of changes in own credit risk in other comprehensive income, for liabilities designated at fair value through profit or loss. HKFRS 9 relaxes the requirements for hedge effectiveness by replacing the bright line hedge effectiveness tests. It requires an economic relationship between the hedged item and hedging instrument and for the ‘hedged ratio’ to be the same as the one management actually use for risk management purposes.

– II-7 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

Contemporaneous documentation is still required but is different to that currently prepared under HKAS 39. The standard is effective for accounting periods beginning on or after 1 January 2018. Early adoption is permitted. Target Company A is yet to assess HKFRS 9’s full impact.

HKFRS 15, ‘Revenue from contracts with customers’ deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. Revenue is recognised when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the good or service. The standard replaces HKAS 18 ‘Revenue’ and HKAS 11 ‘Construction contracts’ and related interpretations. The standard is effective for annual periods beginning on or after 1 January 2017 and earlier application is permitted. Target Company A is assessing the impact of HKFRS 15.

There are no other HKFRSs or HK (IFRIC) interpretations that are not yet effective that would be expected to have a material impact on Target Company A.

3.2 Land use rights

Land use rights which are held for development for sales are inventories and measured at the lower of cost and net realisable value. Net realisable value is determined by reference to estimated sales proceeds of the properties sold in the ordinary course of business less costs to complete development and estimated selling expenses.

Land use rights are classified as current assets unless the construction period of the relevant property development project is expected to complete beyond normal operating cycle.

All lands in China mainland are state-owned and no individual land ownership right exists. Target Company A acquired the rights to use certain land and the premiums paid for such rights are recorded as land use rights.

The lease period of land use rights is between 40 to 70 years.

3.3 Cash

In the cash flow statement, cash includes cash in hand and deposits held at call with banks.

3.4 Paid-in capital

Paid-in capital is classified as equity.

3.5 Amounts due to a related party

The financial liabilities of Target Company A are amounts due to a related party, Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd (“Linjiang Old Town”).

Amounts due to Linjiang Old Town are recorded at amortised cost.

Financial liabilities with repayment period within 1 year (including 1 year) are stated as current liabilities; other financial liabilities with repayment period over 1 year but repayment date within 1 year from balance sheet date are stated as current portion of non-current liabilities; others are stated as noncurrent liabilities.

A financial liability is derecognised or partly derecognised when the current obligation is discharged or partly discharged. The difference between the carrying amount of the financial liability or the derecognised part of the financial liability and the consideration paid is recognised in income statement.

3.6 Current income tax

The tax expense for the year comprises current income tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case the tax is also recognised in other comprehensive income or directly in equity, respectively.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the country where Target Company A operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

– II-8 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

4 FINANCIAL RISK MANAGEMENT

4.1 Financial risk factors

Target Company A’s activities expose it to liquidity risk. Target Company A’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on Target Company A’s financial performance. The board of directors reviews and approves policies for managing each of these risks and they are summarised below.

(a) Liquidity risk

Cash flow forecast is performed by Target Company A. The finance department of Target Company A monitors rolling forecasts of Target Company A’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that Target Company A does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecast takes into consideration Target Company A’s debt financing plans, covenant compliance (if applicable) and compliance with internal balance sheet ratio targets.

The table below analyses Target Company A’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amount disclosed in the table is the contractual undiscounted cash flows.

As at 31 December 2014 Amounts due to a related party (Note 7) As at 30 June 2015 Amounts due to a related party (Note 7)	On demand RMB’000 –

	237,460

4.2 Capital risk management

Target Company A’s objectives when managing capital are to safeguard Target Company A’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Management of Target Company A monitors capital for all companies owned by Linjiang Old Town (incorporated in the PRC) collectively. Target Company A utilises paid-in capital or shareholder loans to meet capital needs, if necessary, Target Company A will also provide fund to or receive fund from other project companies controlled by Linjiang Old Town.

5 FINANCIAL INSTRUMENTS BY CATEGORY

Liabilities As at 31 December 2014 Amounts due to a related party (Note 7) As at 30 June 2015 Amounts due to a related party (Note 7)	Other financial Liabilities at amortised cost RMB’000 –

	237,460

– II-9 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

6 LAND USE RIGHTS

At beginning of the period Additions At end of the period (a) Land use rights are analysed as follows: In the PRC, held on leases of: Between 40 to 70 years	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – 257,460 257,460 As at 31 December 2014 RMB’000 –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

			As at 30 June 2015 RMB’000 257,460

Land use rights are all located in the PRC.

The land use rights were initially acquired by Linjiang Old Town, which has paid for the relevant consideration. In April 2015, Target Company A, Linjiang Old Town and Nanjing Land Resources Bureau entered into an agreement (the “Agreement”). Pursuant to the Agreement, Target Company A obtained the title of the land use rights, and the respective consideration paid by Linjiang Old Town amounting to RMB257,460,000 was recorded as a payable to Linjiang Old Town.

7 AMOUNTS DUE TO A RELATED PARTY

			As at	As at
			31 December	30 June
			2014	2015
			RMB’000	RMB’000
Amount	due	to a related party
Linjiang	Old	Town (Note 9(a))	–	237,460

(a) The carrying amount of amounts due to Linjiang Old Town approximates its fair value.
(b) Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.
(c) An ageing analysis of amounts due to Linjiang Old Town is as follows:

				As at	As at
			31	December	30 June
				2014	2015
				RMB’000	RMB’000
Within	1	year		–	237,460

– II-10 –

ACCOUNTANT’S REPORT OF TARGET COMPANY A

APPENDIX II

8 CASH USED IN OPERATIONS

Profit for the period Changes in working capital: – Amounts due to a related party Cash used in operations Non-cash transaction – Acquisition of land use rights by assuming liability to Linjiang Old Town (Note 6)	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – (20,000) (20,000) (257,460)	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

			–

9 RELATED PARTIES AND RELATED PARTY TRANSACTIONS

The immediate holding company of Target Company A is Linjiang Old Town, which owns 100% of Target Company A’s equity interests. The ultimate holding company of Target Company A is China Metallurgical Corporation Limited (incorporated in the PRC).

(a) Amounts due to related parties:

Linjiang Old Town At beginning of the period Increase (Note 6) Decrease At end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – 257,460 (20,000) 237,460	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

10 FIRST TIME ADOPTION OF HKFRS

This is Target Company A’s first Financial Information prepared in accordance with HKFRS.

The accounting policies set out in Note 3 have been applied in preparing the financial statements.

Reconciliations of CAS to HKFRS

HKFRS 1 requires an entity to reconcile equity, comprehensive income and cash flows for prior periods. Target Company A’s first-time adoption did not have any impact on the total operating, investing or financing cash flows, equity or total comprehensive income for Relevant Periods.

There is no reconciliation of CAS to HKFRS for Financial Information of Target Company A for Relevant Periods.

– II-11 –

APPENDIX II ACCOUNTANT’S REPORT OF TARGET COMPANY A

11 EVENTS AFTER THE BALANCE SHEET DATE

On 12 August 2015, a subsidiary of the Company and Linjiang Old Town entered into an equity transfer agreement (“Equity Transfer Agreement”). Pursuant to the Equity Transfer Agreement and subject to the approval by the SGM of the Company, 100% equity interests of Target Company A will be acquired by the subsidiary of the Company.

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by Target Company A in respect of any period subsequent to 30 June 2015 up to the date of this report. Save as disclosed in this report, no dividend or distribution has been declared or made by Target Company A in respect of any period subsequent to 30 June 2015.

Yours faithfully,

PricewaterhouseCoopers Certified Public Accountants Hong Kong

– II-12 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

24 September 2015

The Directors

Shanghai Zendai Property Limited

Dear Sirs,

We report on the financial information of Nanjing Zendai Kuanyu Real Estate Company Limited (南京証大寬域置業有限公司, “Target Company B”), which comprises the balance sheets of Target Company B as at 31 December 2014 and 30 June 2015, and the income statements, the statements of comprehensive income, the statements of changes in equity and the cash flow statements of Target Company B for the period from 13 February 2014 (date of establishment) to 31 December 2014 and the six months ended 30 June 2015 (the “Relevant Periods”) and a summary of significant accounting policies and other explanatory information. This financial information has been prepared by the directors of Shanghai Zendai Property Limited (the “Company”) and is set out in Sections I to III below for inclusion in Appendix III to the circular of the Company dated 24 September 2015 (the “Circular”) in connection with the proposed acquisition of Target Company B by the Company (the “Transaction”).

Target Company B was incorporated in the People’s Republic of China (the “PRC”) on 13 February 2014 as a limited liability company under the Company Law of the PRC.

The financial statements of the Target Company B for the period ended 31 December 2014 were audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP. The directors of Target Company B during the Relevant Periods are responsible for the preparation and fair presentation of the financial statements in accordance with the Accounting Standards for Business Enterprises of the People’s Republic of China (“CAS”) issued by the China Ministry of Finance, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

The financial information has been prepared based on the audited financial statements for the period from 13 February 2014 (date of establishment) to 31 December 2014 and unaudited financial statements for the six months ended 30 June 2015 of Target Company B with no adjustment made thereon.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL INFORMATION

– III-1 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

REPORTING ACCOUNTANT’S RESPONSIBILITY

OPINION

In our opinion, the financial information gives, for the purpose of this report, a true and fair view of the state of affairs of Target Company B as at 31 December 2014 and 30 June 2015 and of Target Company B’s results and cash flows for the Relevant Periods then ended.

REVIEW OF STUB PERIOD COMPARATIVE FINANCIAL INFORMATION

We have reviewed the stub period comparative financial information set out in Section I to II below included in Appendix III to the Circular which comprises the income statement, the statement of comprehensive income, the statement of changes in equity and the cash flow statement of Target Company B for the period from 13 February 2014 to 30 June 2014 and a summary of significant accounting policies and other explanatory information (the “Stub Period Comparative Financial Information”).

– III-2 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

I. FINANCIAL STATEMENTS OF TARGET COMPANY B

The following is the financial information of Target Company B prepared by the directors of the Company as at 31 December 2014 and 30 June 2015, and for the period from 13 February 2014 (date of establishment) to 31 December 2014, the six months ended 30 June 2015 and the period from 13 February 2014 to 30 June 2014 (the “Financial Information”):

(A) BALANCE SHEETS

Note Assets Current assets Land use rights 6 Cash 7 Total current assets Total assets Equity Paid-in capital Reserve Retained earnings Total equity Liabilities Current liabilities Amounts due to a related party 8 Income tax payable Total current liabilities Total liabilities Total equity and liabilities Net current assets Total assets less current liabilities	As at 31 December 2014 RMB’000 452,800 18 452,818 452,818 20,000 2 13 20,015 20,015 432,800 3 432,803 432,803 452,818 20,015 20,015	As at 30 June 2015 RMB’000 452,800 18
		452,818
		452,818

		20,000 2 13
		20,015
		20,015
		432,800 3
		432,803
		432,803
		452,818

		20,015

		20,015

– III-3 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

(B) INCOME STATEMENTS

Note
Period from
13 February 2014
to 31 December
2014
Six months
ended 30 June
2015
RMB’000
RMB’000
Administrative expenses
9
(10)
–
Other expenses
(1)
–
Operating profit
(11)
–
Finance income
10
31
–
Profit before income tax
20
–
Income tax expense
11
(5)
–
Profit for the period
15
–
Attributable to:
Owner of Target
Company B
15
–
(C)
STATEMENTS OF COMPREHENSIVE INCOME
Period from
13 February 2014
to 31 December
2014
Six months
ended 30 June
2015
RMB’000
RMB’000
Profit for the period
15
–
Total comprehensive income
for the period
15
–
Attributable to:
Owner of Target Company B
15
–

Period from
13 February 2014
to 30 June
2014
RMB’000
(unaudited)
–
(1)
(1)
9
8
(2)
6
6
Period from
13 February 2014
to 30 June
2014
RMB’000
(unaudited)
6
6
6

– III-4 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

(D) STATEMENT OF CHANGES IN OWNERS’ EQUITY

As at 13 February 2014 Comprehensive income Profit for the period Total comprehensive income Transactions with owners Capital contribution Appropriations Total transactions with owners As at 31 December 2014 As at 1 January 2015 As at 30 June 2015 (Unaudited) As at 13 February 2014 Comprehensive income Profit for the period Total comprehensive income Transactions with owners Capital contribution Total transactions with owners As at 30 June 2014	Attributable to owner of Target Company B Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – 15 15 – – 15 15 20,000 – – 20,000 – 2 (2) – 20,000 2 (2) 20,000 20,000 2 13 20,015 20,000 2 13 20,015 20,000 2 13 20,015 Attributable to owner of Target Company B Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – 6 6 – – 6 6 20,000 – – 20,000 20,000 – – 20,000 20,000 – 6 20,006	Total equity RMB’000 – 15
		15
		20,000 –
		20,000
		20,015

		20,015
		20,015

		Total equity RMB’000 – 6
		6
		20,000
		20,000
		20,006

– III-5 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

(E) CASH FLOW STATEMENTS

Item Note Cash flows from operating activities Cash (used in)/generated from operations 12 Income tax paid Net cash (used in)/ generated from operating activities Cash flows from financing activities Capital contribution received from owner Net cash generated from financing activities Net increase in cash Cash at beginning of the period Cash at end of the period	Period from 13 February 2014 to 31 December 2014 RMB’000 (19,980) (2) (19,982) 20,000 20,000 18 – 18	Six months ended 30 June 2015 RMB’000 – – – – – – 18 18	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) 8 –
			8
			20,000
			20,000
			20,008 –
			20,008

– III-6 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

II. NOTES TO THE FINANCIAL INFORMATION

1 GENERAL INFORMATION

Nanjing Zendai Kuanyu Real Estate Company Limited (“Target Company B”) was incorporated with limited liability in the PRC on 13 February 2014. The address of its registered office is No. 550 Zhongshan North Road, Gulou District, Nanjing, Jiangsu Province, the PRC.

Target Company B is principally engaged in property development services in the PRC.

These financial statements are presented in Renminbi (“RMB”), unless otherwise stated.

These financial statements have been approved for issue by the Board of Directors on 24 September 2015.

2 BASIS OF PREPARATION

The Financial Information has been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by Hong Kong Institute of Certified Public Accountants (“HKICPA”).

The Financial Information has been prepared under the historical cost convention.

HKFRS 1, First-time adoption of Hong Kong Financial Reporting Standards, has been applied in preparing these financial statements. As disclosed in Note 14, Target Company B has consistently applied the accounting policies used in the preparation of its opening HKFRS balance sheet at 31 December 2014 throughout all periods presented. Note 14 discloses the impact of adoption of HKFRS on Target Company B’s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in Target Company B’s financial statements prepared under Accounting Standards for Business Enterprises of the PRC (“CAS”).

Standards, amendments to standards and interpretations that are effective during the Relevant Periods have been adopted and applied by Target Company B consistently throughout the Relevant Periods.

There were no assets, equity or liabilities for Target Company B as at 13 February 2014 (date of establishment).

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below.

3.1 Changes in accounting policy and disclosures

New standards and interpretations not yet adopted

– III-7 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

There are no other HKFRSs or HK (IFRIC) interpretations that are not yet effective that would be expected to have a material impact on Target Company B.

3.2 Land use rights

Land use rights are classified as current assets unless the construction period of the relevant property development project is expected to complete beyond normal operating cycle.

All lands in China mainland are state-owned and no individual land ownership right exists. Target Company B acquired the rights to use certain land and the premiums paid for such rights are recorded as land use rights.

The lease period of land use rights is between 40 to 70 years.

3.3 Cash

In the cash flow statement, cash includes cash in hand and deposits held at call with banks.

3.4 Paid-in capital

Paid-in capital is classified as equity.

3.5 Amounts due to a related party

The financial liabilities of Target Company B are amounts due to a related party, Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd (“Linjiang Old Town”).

Amounts due to Linjiang Old Town are recorded at amortised cost.

3.6 Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the country where Target Company B operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

– III-8 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

4 FINANCIAL RISK MANAGEMENT

4.1 Financial risk factors

Target Company B’s activities expose it to a variety of financial risks: credit risk and liquidity risk. Target Company B’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on Target Company B’s financial performance. The board of directors reviews and approves policies for managing each of these risks and they are summarised below.

(a) Credit risk

Credit risk arises from cash. The carrying amounts of cash represent Target Company B’s maximum exposure to credit risk in relation to its financial assets.

To manage such exposure, Target Company B has policies in place to ensure that deposits are placed with banks with appropriate credit ratings. Target Company B has no significant concentration of credit risk.

(b) Liquidity risk

Cash flow forecast is performed by Target Company B. The finance department of Target Company B monitors rolling forecasts of Target Company B’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that Target Company B does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecast takes into consideration Target Company B’s debt financing plans, covenant compliance (if applicable) and compliance with internal balance sheet ratio targets.

The table below analyses Target Company B’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amount disclosed in the table is the contractual undiscounted cash flows.

As at 31 December 2014 Amounts due to a related party (Note 8) As at 30 June 2015 Amounts due to a related party (Note 8)	On demand RMB’000 432,800

	432,800

4.2 Capital risk management

Target Company B’s objectives when managing capital are to safeguard Target Company B’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Management of Target Company B monitors capital for all companies owned by Linjiang Old Town (incorporated in the PRC) collectively. Target Company B utilises paid-in capital or shareholder loans to meet capital needs, if necessary, Target Company B will also provide fund to or receive fund from other project companies controlled by Linjiang Old Town.

– III-9 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

5 FINANCIAL INSTRUMENTS BY CATEGORY

Loans and receivables RMB’000

Assets As at 31 December 2014 Cash (Note 7) As at 30 June 2015 Cash (Note 7) Liabilities As at 31 December 2014 Amounts due to a related party (Note 8) As at 30 June 2015 Amounts due to a related party (Note 8)	18

	18

	Other financial liabilities at amortised cost RMB’000 432,800

	432,800

6 LAND USE RIGHTS

At beginning of the period Additions At end of the period	Period from 13 February 2014 to 31 December 2014 RMB’000 – 452,800 452,800	Six months ended 30 June 2015 RMB’000 452,800 – 452,800	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) – 452,800
			452,800

(a) Land use rights are analysed as follows:

	As at	As at
	31 December	30 June
	2014	2015
	RMB’000	RMB’000
In the PRC, held on leases of:
Between 40 to 70 years	452,800	452,800

Land use rights are all located in the PRC.

– III-10 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

The land use rights were initially acquired by Linjiang Old Town, which has paid for the relevant consideration. In May 2014, Target Company B, Linjiang Old Town and Nanjing Land Resources Bureau entered into an agreement (the “Agreement”). Pursuant to the Agreement, Target Company B obtained the title of the land use rights, and the respective consideration paid by Linjiang Old Town amounting to RMB452,800,000 was recorded as a payable to Linjiang Old Town.

7 CASH

Short-term bank deposits Denominated in: – RMB	As at 31 December 2014 RMB’000 18 18	As at 30 June 2015 RMB’000 18

		18

The effective interest rate on short-term bank deposits is 0.35% per annum as at 31 December 2014 and 30 June 2015.

8 AMOUNTS DUE TO A RELATED PARTY

			As at	As at
			31 December	30 June
			2014	2015
			RMB’000	RMB’000
Amount	due	to a related party
Linjiang	Old	Town (Note 13(a))	432,800	432,800

(a) The carrying amount of amounts due to Linjiang Old Town approximates its fair value.
(b) Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.
(c) An ageing analysis of amounts due to Linjiang Old Town is as follows:

Within 1 year Between 1 year to 2 years Total	As at 31 December 2014 RMB’000 432,800 – 432,800	As at 30 June 2015 RMB’000 – 432,800
		432,800

9 EXPENSES BY NATURE

Expenses by nature comprised administrative expenses as follows:

			Period from		Period from
		13	February 2014	Six months	13 February 2014
		to 31 December		ended 30 June	to 30 June
			2014	2015	2014
			RMB’000	RMB’000	RMB’000
					(unaudited)
Stamp	tax		10	–	–

– III-11 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

10 FINANCE INCOME

			Period from		Period from
		13	February 2014	Six months	13 February 2014
		to 31 December		ended 30 June	to 30 June
			2014	2015	2014
			RMB’000	RMB’000	RMB’000
					(unaudited)
Interest	income		31	–	9

11 INCOME TAX EXPENSE

Target Company B is subjected to PRC enterprise income tax, which has been provided based on the statutory income tax rate of 25% of the assessable income of Target Company B for the period from 13 February 2014 to 31 December 2014, the six months ended 30 June 2015 and the period from 13 February 2014 to 30 June 2014.

		Period from		Period from
	13	February 2014	Six months	13 February 2014
	to 31 December		ended 30 June	to 30 June
		2014	2015	2014
		RMB’000	RMB’000	RMB’000
				(unaudited)
Current income tax
– PRC enterprise income tax		5	–	2

The reconciliation from income tax calculated based on the applicable tax rates and total profit presented in the financial statements to the income tax expenses is listed below:

Profit for the period Tax calculated at a tax rate of 25%	Period from 13 February 2014 to 31 December 2014 RMB’000 20 5 5	Six months ended 30 June 2015 RMB’000 – – –	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) 8
			2 2

12 CASH (USED IN)/GENERATED FROM OPERATIONS

Profit for the period Adjustment for: – Income tax expense (Note 11) Changes in working capital: – Amounts due to a related party Cash (used in)/generated from operations	Period from 13 February 2014 to 31 December 2014 RMB’000 15 5 (20,000) (19,980)	Six months ended 30 June 2015 RMB’000 – – – –	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) 6 2 –
			8

– III-12 –

ACCOUNTANT’S REPORT OF TARGET COMPANY B

APPENDIX III

	Period from		Period from
	13 February 2014	Six months	13 February 2014
	to 31 December	ended 30 June	to 30 June
	2014	2015	2014
	RMB’000	RMB’000	RMB’000
			(unaudited)
Non-cash transaction
– Acquisition of land use rights by
assuming liability to Linjiang Old
Town (Note 6)	(452,800)	–	(452,800)

13 RELATED PARTIES AND RELATED PARTY TRANSACTIONS

The immediate holding company of Target Company B is Linjiang Old Town, which owns 100% of Target Company B’s equity interests. The ultimate holding company of Target Company B is China Metallurgical Corporation Limited (incorporated in the PRC).

(a) Amounts due to related parties:

Linjiang Old Town At beginning of the period Increase (Note 6) Decrease At end of the period	Period from 13 February 2014 to 31 December 2014 RMB’000 – 452,800 (20,000) 432,800	Six months ended 30 June 2015 RMB’000 432,800 – – 432,800	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) – 452,800 –
			452,800

Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

14 FIRST TIME ADOPTION OF HKFRS

This is Target Company B’s first Financial Information prepared in accordance with HKFRS.

The accounting policies set out in Note 3 have been applied in preparing the financial statements.

Reconciliations of CAS to HKFRS

HKFRS 1 requires an entity to reconcile equity, comprehensive income and cash flows for prior periods. Target Company B’s first-time adoption did not have any impact on the total operating, investing or financing cash flows, equity or total comprehensive income for Relevant Periods.

There is no reconciliation of CAS to HKFRS for Financial Information of Target Company B for Relevant Periods.

15 EVENTS AFTER THE BALANCE SHEET DATE

On 12 August 2015, a subsidiary of the Company and Linjiang Old Town entered into an equity transfer agreement (“Equity Transfer Agreement”). Pursuant to the Equity Transfer Agreement and subject to the approval by the SGM of the Company, 100% equity interests of Target Company B will be acquired by the subsidiary of the Company.

– III-13 –

APPENDIX III ACCOUNTANT’S REPORT OF TARGET COMPANY B

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by Target Company B in respect of any period subsequent to 30 June 2015 up to the date of this report. Save as disclosed in this report, no dividend or distribution has been declared or made by Target Company B in respect of any period subsequent to 30 June 2015.

Yours faithfully, PricewaterhouseCoopers Certified Public Accountants Hong Kong

– III-14 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

24 September 2015

The Directors

Shanghai Zendai Property Limited

Dear Sirs,

We report on the financial information of Nanjing Thumb Development Company Limited (南京大拇指商業發展有限公司, “Target Company C”), which comprises the balance sheets of Target Company C as at 31 December 2014 and 30 June 2015, and the income statements, the statements of comprehensive income, the statements of changes in equity and the cash flow statements of Target Company C for the period from 22 May 2014 (date of establishment) to 31 December 2014 and the six months ended 30 June 2015 (the “Relevant Periods”) and a summary of significant accounting policies and other explanatory information. This financial information has been prepared by the directors of Shanghai Zendai Property Limited (the “Company”) and is set out in Sections I to III below for inclusion in Appendix IV to the circular of the Company dated 24 September 2015 (the “Circular”) in connection with the proposed acquisition of Target Company C by the Company (the “Transaction”).

Target Company C was incorporated in the People’s Republic of China (the “PRC”) on 22 May 2014 as a limited liability company under the Company Law of the PRC.

No audited financial statements have been prepared by the Target Company C as it has not been involved in any business transactions since its date of incorporation till 31 December 2014. The directors of Target Company C during the Relevant Periods are responsible for the preparation and fair presentation of the financial statements in accordance with the Accounting Standards for Business Enterprises of the People’s Republic of China (“CAS”) issued by the China Ministry of Finance, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

The financial information has been prepared based on the unaudited financial statements of Target Company C with no adjustment made thereon.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL INFORMATION

– IV-1 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

REPORTING ACCOUNTANT’S RESPONSIBILITY

OPINION

In our opinion, the financial information gives, for the purpose of this report, a true and fair view of the state of affairs of Target Company C as at 31 December 2014 and 30 June 2015 and of Target Company C’s results and cash flows for the Relevant Periods then ended.

REVIEW OF STUB PERIOD COMPARATIVE FINANCIAL INFORMATION

We have reviewed the stub period comparative financial information set out in Section I to II below included in Appendix IV to the Circular which comprises the income statement, the statement of comprehensive income, the statement of changes in equity and the cash flow statement of Target Company C for the period from 22 May 2014 to 30 June 2014 and a summary of significant accounting policies and other explanatory information (the “Stub Period Comparative Financial Information”).

– IV-2 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

I. FINANCIAL STATEMENTS OF TARGET COMPANY C

The following is the financial information of Target Company C prepared by the directors of the Company as at 31 December 2014 and 30 June 2015, and for the period from 22 May 2014 (date of establishment) to 31 December 2014, the six months ended 30 June 2015 and the period from 22 May 2014 to 30 June 2014 (the “Financial Information”):

(A) BALANCE SHEETS

Note Assets Current assets Land use rights 6 Total current assets Total assets Equity Paid-in capital Total equity Liabilities Current liabilities Amounts due to a related party 7 Total current liabilities Total liabilities Total equity and liabilities Net current assets Total assets less current liabilities	As at 31 December 2014 RMB’000 – – – – – – – – – – –	As at 30 June 2015 RMB’000 153,240
		153,240
		153,240

		20,000
		20,000
		133,240
		133,240
		133,240
		153,240

		20,000

		20,000

– IV-3 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

(B) INCOME STATEMENTS

Operating profit Profit before income tax Income tax expense Profit for the period Attributable to: Owner of Target Company C	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – –	Six months ended 30 June 2015 RMB’000 – – – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

			–

(C) STATEMENTS OF COMPREHENSIVE INCOME

Profit for the period Total comprehensive income for the period Attributable to: Owner of Target Company C	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–

			–

– IV-4 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

(D) STATEMENT OF CHANGES IN OWNERS’ EQUITY

As at 22 May 2014 As at 31 December 2014 As at 1 January 2015 Transactions with owners Capital contribution Total transactions with owners As at 30 June 2015 (Unaudited) As at 22 May 2014 As at 30 June 2014	Attributable to owner of Target Company C Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – – – – – – 20,000 – – 20,000 20,000 – – 20,000 20,000 – – 20,000 Attributable to owner of Target Company C Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – –	Total equity RMB’000 –
		–

		–
		20,000
		20,000
		20,000

		Total equity RMB’000 –
		–

– IV-5 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

(E) CASH FLOW STATEMENTS

Item Note Cash flows from operating activities Cash used in operations 8 Net cash used in operating activities Cash flows from financing activities Capital contribution received from owner Net cash generated from financing activities Net increase in cash Cash at beginning of the period Cash at end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – – – –	Six months ended 30 June 2015 RMB’000 (20,000) (20,000) 20,000 20,000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–
			–
			–
			– –
			–

– IV-6 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

II. NOTES TO THE FINANCIAL INFORMATION

1 GENERAL INFORMATION

Nanjing Thumb Development Company Limited (“Target Company C”) was incorporated with limited liability in the PRC on 22 May 2014. The address of its registered office is No. 550 Zhongshan North Road, Gulou District, Nanjing, Jiangsu Province, the PRC.

Target Company C is principally engaged in property development services in the PRC.

These financial statements are presented in Renminbi (“RMB”), unless otherwise stated.

These financial statements have been approved for issue by the Board of Directors on 24 September 2015.

2 BASIS OF PREPARATION

The Financial Information has been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by Hong Kong Institute of Certified Public Accountants (“HKICPA”).

The Financial Information has been prepared under the historical cost convention.

HKFRS 1, First-time adoption of Hong Kong Financial Reporting Standards, has been applied in preparing these financial statements. As disclosed in Note 10, Target Company C has consistently applied the accounting policies used in the preparation of its opening HKFRS balance sheet at 31 December 2014 throughout all periods presented. Note 10 discloses the impact of adoption of HKFRS on Target Company C’s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in Target Company C’s financial statements prepared under Accounting Standards for Business Enterprises of the PRC (“CAS”).

Standards, amendments to standards and interpretations that are effective during the Relevant Periods have been adopted and applied by Target Company C consistently throughout the Relevant Periods.

There were no assets, equity or liabilities for Target Company C as at 22 May 2014 (date of establishment).

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below.

3.1 Changes in accounting policy and disclosures

New standards and interpretations not yet adopted

– IV-7 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

There are no other HKFRSs or HK (IFRIC) interpretations that are not yet effective that would be expected to have a material impact on Target Company C.

3.2 Land use rights

Land use rights are classified as current assets unless the construction period of the relevant property development project is expected to complete beyond normal operating cycle.

All lands in China mainland are state-owned and no individual land ownership right exists. Target Company C acquired the rights to use certain land and the premiums paid for such rights are recorded as land use rights.

The lease period of land use rights is between 40 to 70 years.

3.3 Cash

In the cash flow statement, cash includes cash in hand and deposits held at call with banks.

3.4 Paid-in capital

Paid-in capital is classified as equity.

3.5 Amounts due to a related party

The financial liabilities of Target Company C are amounts due to a related party, Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd (“Linjiang Old Town”).

Amounts due to Linjiang Old Town are recorded at amortised cost.

3.6 Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the country where Target Company C operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

– IV-8 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

4 FINANCIAL RISK MANAGEMENT

4.1 Financial risk factors

Target Company C’s activities expose it to liquidity risk. Target Company C’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on Target Company C’s financial performance. The board of directors reviews and approves policies for managing each of these risks and they are summarised below.

(a) Liquidity risk

Cash flow forecast is performed by Target Company C. The finance department of Target Company C monitors rolling forecasts of Target Company C’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that Target Company C does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecast takes into consideration Target Company C’s debt financing plans, covenant compliance (if applicable) and compliance with internal balance sheet ratio targets.

The table below analyses Target Company C’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amount disclosed in the table is the contractual undiscounted cash flows.

As at 31 December 2014 Amounts due to a related party (Note 7) As at 30 June 2015 Amounts due to a related party (Note 7)	On demand RMB’000 –

	133,240

4.2 Capital risk management

Target Company C’s objectives when managing capital is to safeguard Target Company C’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Management of Target Company C monitors capital for all companies owned by Linjiang Old Town (incorporated in the PRC) collectively. Target Company C utilises paid-in capital or shareholder loans to meet capital needs, if necessary, Target Company C will also provide fund to or receive fund from other project companies controlled by Linjiang Old Town.

5 FINANCIAL INSTRUMENTS BY CATEGORY

Liabilities As at 31 December 2014 Amounts due to a related party (Note 7) As at 30 June 2015 Amounts due to a related party (Note 7)	Other financial Liabilities at amortised cost RMB’000 –

	133,240

– IV-9 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

6 LAND USE RIGHTS

At beginning of the period Additions At end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – 153,240 153,240	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

(a) Land use rights are analysed as follows:

	As at	As at
	31 December	30 June
	2014	2015
	RMB’000	RMB’000
In the PRC, held on leases of:
Between 40 to 70 years	–	153,240

Land use rights are all located in the PRC.

The land use rights were initially acquired by Linjiang Old Town, which has paid for the relevant consideration. In April 2015, Target Company C, Linjiang Old Town and Nanjing Land Resources Bureau entered into an agreement (the “Agreement”). Pursuant to the Agreement, Target Company C obtained the title of the land use rights, and the respective consideration paid by Linjiang Old Town amounting to RMB153,240,000 was recorded as a payable to Linjiang Old Town.

7 AMOUNTS DUE TO A RELATED PARTY

			As at	As at
			31 December	30 June
			2014	2015
			RMB’000	RMB’000
Amount	due	to a related party
Linjiang	Old	Town (Note 9(a))	–	133,240

(a) The carrying amount of amounts due to Linjiang Old Town approximates its fair value.

(b) Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

				As at	As at
			31	December	30 June
				2014	2015
				RMB’000	RMB’000
Within	1	year		–	133,240

– IV-10 –

ACCOUNTANT’S REPORT OF TARGET COMPANY C

APPENDIX IV

8 CASH USED IN OPERATIONS

Profit for the period Changes in working capital: – Amounts due to a related party Cash used in operations Non-cash transaction – Acquisition of land use rights by assuming liability to Linjiang Old Town (Note 6)	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – (20,000) (20,000) (153,240)	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

			–

9 RELATED PARTIES AND RELATED PARTY TRANSACTIONS

The immediate holding company of Target Company C is Linjiang Old Town, which owns 100% of Target Company C’s equity interests. The ultimate holding company of Target Company C is China Metallurgical Corporation Limited (incorporated in the PRC).

(a) Amounts due to related parties:

Linjiang Old Town At beginning of the period Increase (Note 6) Decrease At end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – 153,240 (20,000) 133,240	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

10 FIRST TIME ADOPTION OF HKFRS

This is Target Company C’s first Financial Information prepared in accordance with HKFRS.

The accounting policies set out in Note 3 have been applied in preparing the financial statements.

Reconciliations of CAS to HKFRS

HKFRS 1 requires an entity to reconcile equity, comprehensive income and cash flows for prior periods. Target Company C’s first-time adoption did not have any impact on the total operating, investing or financing cash flows, equity or total comprehensive income for Relevant Periods.

There is no reconciliation of CAS to HKFRS for Financial Information of Target Company C for Relevant Periods.

– IV-11 –

APPENDIX IV ACCOUNTANT’S REPORT OF TARGET COMPANY C

11 EVENTS AFTER THE BALANCE SHEET DATE

On 12 August 2015, a subsidiary of the Company and Linjiang Old Town entered into an equity transfer agreement (“Equity Transfer Agreement”). Pursuant to the Equity Transfer Agreement and subject to the approval by the SGM of the Company, 100% equity interests of Target Company C will be acquired by the subsidiary of the Company.

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by Target Company C in respect of any period subsequent to 30 June 2015 up to the date of this report. Save as disclosed in this report, no dividend or distribution has been declared or made by Target Company C in respect of any period subsequent to 30 June 2015.

Yours faithfully, PricewaterhouseCoopers Certified Public Accountants Hong Kong

– IV-12 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

24 September 2015

The Directors

Shanghai Zendai Property Limited

Dear Sirs,

We report on the financial information of Nanjing Shuiqingmuhua Real Estate Company Limited (南京水清木華置業有限公司, “Target Company D”), which comprises the balance sheets of Target Company D as at 31 December 2014 and 30 June 2015, and the income statements, the statements of comprehensive income, the statements of changes in equity and the cash flow statements of Target Company D for the period from 22 May 2014 (date of establishment) to 31 December 2014 and the six months ended 30 June 2015 (the “Relevant Periods”) and a summary of significant accounting policies and other explanatory information. This financial information has been prepared by the directors of Shanghai Zendai Property Limited (the “Company”) and is set out in Sections I to III below for inclusion in Appendix V to the circular of the Company dated 24 September 2015 (the “Circular”) in connection with the proposed acquisition of Target Company D by the Company (the “Transaction”).

Target Company D was incorporated in the People’s Republic of China (the “PRC”) on 22 May 2014 as a limited liability company under the Company Law of the PRC.

No audited financial statements have been prepared by the Target Company D as it has not been involved in any business transactions since its date of incorporation till 31 December 2014. The directors of Target Company D during the Relevant Periods are responsible for the preparation and fair presentation of the financial statements in accordance with the Accounting Standards for Business Enterprises of the People’s Republic of China (“CAS”) issued by the China Ministry of Finance, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

The financial information has been prepared based on the unaudited financial statements of Target Company D with no adjustment made thereon.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL INFORMATION

– V-1 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

REPORTING ACCOUNTANT’S RESPONSIBILITY

OPINION

In our opinion, the financial information gives, for the purpose of this report, a true and fair view of the state of affairs of Target Company D as at 31 December 2014 and 30 June 2015 and of Target Company D’s results and cash flows for the Relevant Periods then ended.

REVIEW OF STUB PERIOD COMPARATIVE FINANCIAL INFORMATION

We have reviewed the stub period comparative financial information set out in Section I to II below included in Appendix V to the Circular which comprises the income statement, the statement of comprehensive income, the statement of changes in equity and the cash flow statement of Target Company D for the period from 22 May 2014 to 30 June 2014 and a summary of significant accounting policies and other explanatory information (the “Stub Period Comparative Financial Information”).

– V-2 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

I. FINANCIAL STATEMENTS OF TARGET COMPANY D

The following is the financial information of Target Company D prepared by the directors of the Company as at 31 December 2014 and 30 June 2015, and for the period from 22 May 2014 (date of establishment) to 31 December 2014, the six months ended 30 June 2015 and the period from 22 May 2014 to 30 June 2014 (the “Financial Information”):

(A) BALANCE SHEETS

Note Assets Current assets Land use rights 6 Total current assets Total assets Equity Paid-in capital Total equity Liabilities Current liabilities Amounts due to a related party 7 Total current liabilities Total liabilities Total equity and liabilities Net current assets Total assets less current liabilities	As at 31 December 2014 RMB’000 – – – – – – – – – – –	As at 30 June 2015 RMB’000 550,010
		550,010
		550,010

		20,000
		20,000
		530,010
		530,010
		530,010
		550,010

		20,000

		20,000

– V-3 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

(B) INCOME STATEMENTS

Operating profit Profit before income tax Income tax expense Profit for the period Attributable to: Owner of Target Company D	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – –	Six months ended 30 June 2015 RMB’000 – – – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

			–

(C) STATEMENTS OF COMPREHENSIVE INCOME

Profit for the period Total comprehensive income for the period Attributable to: Owner of Target Company D	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–

			–

– V-4 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

(D) STATEMENT OF CHANGES IN OWNERS’ EQUITY

As at 22 May 2014 As at 31 December 2014 As at 1 January 2015 Transactions with owners Capital contribution Total transactions with owners As at 30 June 2015 (unaudited) As at 22 May 2014 As at 30 June 2014	Attributable to owner of Target Company D Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – – – – – – 20,000 – – 20,000 20,000 – – 20,000 20,000 – – 20,000 Attributable to owner of Target Company D Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – –	Total equity RMB’000 –
		–

		–
		20,000
		20,000
		20,000

		Total equity RMB’000 –
		–

– V-5 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

(E) CASH FLOW STATEMENTS

Item Note Cash flows from operating activities Cash used in operations 8 Net cash used in operating activities Cash flows from financing activities Capital contribution received from owner Net cash generated from financing activities Net increase in cash Cash at beginning of the period Cash at end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – – – –	Six months ended 30 June 2015 RMB’000 (20,000) (20,000) 20,000 20,000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–
			–
			–
			– –
			–

– V-6 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

II. NOTES TO THE FINANCIAL INFORMATION

1 GENERAL INFORMATION

Nanjing Shuiqingmuhua Real Estate Company Limited (“Target Company D”) was incorporated with limited liability in the PRC on 22 May 2014. The address of its registered office is No. 550 Zhongshan North Road, Gulou District, Nanjing, Jiangsu Province, the PRC.

Target Company D is principally engaged in property development services in the PRC.

These financial statements are presented in Renminbi (“RMB”), unless otherwise stated.

These financial statements have been approved for issue by the Board of Directors on 24 September 2015.

2 BASIS OF PREPARATION

The Financial Information has been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by Hong Kong Institute of Certified Public Accountants (“HKICPA”).

The Financial Information has been prepared under the historical cost convention.

HKFRS 1, First-time adoption of Hong Kong Financial Reporting Standards, has been applied in preparing these financial statements. As disclosed in Note 10, Target Company D has consistently applied the accounting policies used in the preparation of its opening HKFRS balance sheet at 31 December 2014 throughout all periods presented. Note 10 discloses the impact of adoption of HKFRS on Target Company D’s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in Target Company D’s financial statements prepared under Accounting Standards for Business Enterprises of the PRC (“CAS”).

Standards, amendments to standards and interpretations that are effective during the Relevant Periods have been adopted and applied by Target Company D consistently throughout the Relevant Periods.

There were no assets, equity or liabilities for Target Company D as at 22 May 2014 (date of establishment).

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below.

3.1 Changes in accounting policy and disclosures

New standards and interpretations not yet adopted

– V-7 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

There are no other HKFRSs or HK (IFRIC) interpretations that are not yet effective that would be expected to have a material impact on Target Company D.

3.2 Land use rights

Land use rights are classified as current assets unless the construction period of the relevant property development project is expected to complete beyond normal operating cycle.

All lands in China mainland are state-owned and no individual land ownership right exists. Target Company D acquired the rights to use certain land and the premiums paid for such rights are recorded as land use rights.

The lease period of land use rights is between 40 to 70 years.

3.3 Cash

In the cash flow statement, cash includes cash in hand and deposits held at call with banks.

3.4 Paid-in capital

Paid-in capital is classified as equity.

3.5 Amounts due to a related party

The financial liabilities of Target Company D are amounts due to a related party, Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd (“Linjiang Old Town”).

Amounts due to Linjiang Old Town are recorded at amortised cost.

3.6 Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the country where Target Company D operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

– V-8 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

4 FINANCIAL RISK MANAGEMENT

4.1 Financial risk factors

Target Company D’s activities expose it to liquidity risk. Target Company D’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on Target Company D’s financial performance. The board of directors reviews and approves policies for managing each of these risks and they are summarised below.

(a) Liquidity risk

Cash flow forecast is performed by Target Company D. The finance department of Target Company D monitors rolling forecasts of Target Company D’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that Target Company D does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecast takes into consideration Target Company D’s debt financing plans, covenant compliance (if applicable) and compliance with internal balance sheet ratio targets.

The table below analyses Target Company D’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amount disclosed in the table is the contractual undiscounted cash flows.

As at 31 December 2014 Amounts due to a related party (Note 7) As at 30 June 2015 Amounts due to a related party (Note 7)	On demand RMB’000 –

	530,010

4.2 Capital risk management

Target Company D’s objectives when managing capital is to safeguard Target Company D’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Management of Target Company D monitors capital for all companies owned by Linjiang Old Town (incorporated in the PRC) collectively. Target Company D utilises paid-in capital or shareholder loans to meet capital needs, if necessary, Target Company D will also provide fund to or receive fund from other project companies controlled by Linjiang Old Town.

5 FINANCIAL INSTRUMENTS BY CATEGORY

Liabilities As at 31 December 2014 Amounts due to a related party (Note 7) As at 30 June 2015 Amounts due to a related party (Note 7)	Other financial Liabilities at amortised cost RMB’000 –

	530,010

– V-9 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

6 LAND USE RIGHTS

At beginning of the period Additions At end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – 550,010 550,010	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

(a) Land use rights are analysed as follows:

	As at	As at
	31 December	30 June
	2014	2015
	RMB’000	RMB’000
In the PRC, held on leases of:
Between 40 to 70 years	–	550,010

Land use rights are all located in the PRC.

The land use rights were initially acquired by Linjiang Old Town, which has paid for the relevant consideration. In April 2015, Target Company D, Linjiang Old Town and Nanjing Land Resources Bureau entered into an agreement (the “Agreement”). Pursuant to the Agreement, Target Company D obtained the title of the land use rights, and the respective consideration paid by Linjiang Old Town amounting to RMB550,010,000 was recorded as a payable to Linjiang Old Town.

7 AMOUNTS DUE TO A RELATED PARTY

			As at	As at
			31 December	30 June
			2014	2015
			RMB’000	RMB’000
Amount	due	to a related party
Linjiang	Old	Town (Note 9(a))	–	530,010

(a) The carrying amount of amounts due to Linjiang Old Town approximates its fair value.
(b) Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.
(c) An ageing analysis of amounts due to Linjiang Old Town is as follows:

				As at	As at
			31	December	30 June
				2014	2015
				RMB’000	RMB’000
Within	1	year		–	530,010

– V-10 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

8 CASH USED IN OPERATIONS

Profit for the period Changes in working capital: – Amounts due to Linjiang Old Town Cash used in operations Non-cash transaction – Acquisition of land use rights by assuming liability to Linjiang Old Town (Note 6)	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – (20,000) (20,000) (550,010)	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

			–

9 RELATED PARTIES AND RELATED PARTY TRANSACTIONS

The immediate holding company of Target Company D is Linjiang Old Town, which owns 100% of Target Company D’s equity interests. The ultimate holding company of Target Company D is China Metallurgical Corporation Limited (incorporated in the PRC).

(a) Amounts due to related parties:

Linjiang Old Town At beginning of the period Increase (Note 6) Decrease At end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – 550,010 (20,000) 530,010	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

10 FIRST TIME ADOPTION OF HKFRS

This is Target Company D’s first Financial Information prepared in accordance with HKFRS.

The accounting policies set out in Note 3 have been applied in preparing the financial statements.

Reconciliations of CAS to HKFRS

HKFRS 1 requires an entity to reconcile equity, comprehensive income and cash flows for prior periods. Target Company D’s first-time adoption did not have any impact on the total operating, investing or financing cash flows, equity or total comprehensive income for Relevant Periods.

There is no reconciliation of CAS to HKFRS for Financial Information of Target Company D for Relevant Periods.

– V-11 –

ACCOUNTANT’S REPORT OF TARGET COMPANY D

APPENDIX V

11 EVENTS AFTER THE BALANCE SHEET DATE

On 12 August 2015, a subsidiary of the Company and Linjiang Old Town entered into an equity transfer agreement (“Equity Transfer Agreement”). Pursuant to the Equity Transfer Agreement and subject to the approval by the SGM of the Company, 100% equity interests of Target Company D will be acquired by the subsidiary of the Company.

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by Target Company D in respect of any period subsequent to 30 June 2015 up to the date of this report. Save as disclosed in this report, no dividend or distribution has been declared or made by Target Company D in respect of any period subsequent to 30 June 2015.

Yours faithfully, PricewaterhouseCoopers Certified Public Accountants Hong Kong

– V-12 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

24 September 2015

The Directors

Shanghai Zendai Property Limited

Dear Sirs,

We report on the financial information of Nanjing Radisson Real Estate Company Limited (南京麗笙置業有限公司, “Target Company E”), which comprises the balance sheets of Target Company E as at 31 December 2014 and 30 June 2015, and the income statements, the statements of comprehensive income, the statements of changes in equity and the cash flow statements of Target Company E for the period from 22 May 2014 (date of establishment) to 31 December 2014 and the six months ended 30 June 2015 (the “Relevant Periods”) and a summary of significant accounting policies and other explanatory information. This financial information has been prepared by the directors of Shanghai Zendai Property Limited (the “Company”) and is set out in Sections I to III below for inclusion in Appendix VI to the circular of the Company dated 24 September 2015 (the “Circular”) in connection with the proposed acquisition of Target Company E by the Company (the “Transaction”).

Target Company E was incorporated in the People’s Republic of China (the “PRC”) on 22 May 2014 as a limited liability company under the Company Law of the PRC.

No audited financial statements have been prepared by the Target Company E as it has not been involved in any business transactions since its date of incorporation till 31 December 2014. The directors of Target Company E during the Relevant Periods are responsible for the preparation and fair presentation of the financial statements in accordance with the Accounting Standards for Business Enterprises of the People’s Republic of China (“CAS”) issued by the China Ministry of Finance, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

The financial information has been prepared based on the unaudited financial statements of Target Company E with no adjustment made thereon.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL INFORMATION

– VI-1 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

REPORTING ACCOUNTANT’S RESPONSIBILITY

OPINION

In our opinion, the financial information gives, for the purpose of this report, a true and fair view of the state of affairs of Target Company E as at 31 December 2014 and 30 June 2015 and of Target Company E’s results and cash flows for the Relevant Periods then ended.

REVIEW OF STUB PERIOD COMPARATIVE FINANCIAL INFORMATION

We have reviewed the stub period comparative financial information set out in Section I to II below included in Appendix VI to the Circular which comprises the income statement, the statement of comprehensive income, the statement of changes in equity and the cash flow statement of Target Company E for the period from 22 May 2014 to 30 June 2014 and a summary of significant accounting policies and other explanatory information (the “Stub Period Comparative Financial Information”).

– VI-2 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

I. FINANCIAL STATEMENTS OF TARGET COMPANY E

The following is the financial information of Target Company E prepared by the directors of the Company as at 31 December 2014 and 30 June 2015, and for the period from 22 May 2014 (date of establishment) to 31 December 2014, the six months ended 30 June 2015 and the period from 22 May 2014 to 30 June 2014 (the “Financial Information”):

(A) BALANCE SHEETS

Note Assets Current assets Land use rights 6 Total current assets Total assets Equity Paid-in capital Total equity Liabilities Current liabilities Amounts due to a related party 7 Total current liabilities Total liabilities Total equity and liabilities Net current assets Total assets less current liabilities	As at 31 December 2014 RMB’000 – – – – – – – – – – –	As at 30 June 2015 RMB’000 368,310
		368,310
		368,310

		20,000
		20,000
		348,310
		348,310
		348,310
		368,310

		20,000

		20,000

– VI-3 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

(B) INCOME STATEMENTS

Operating profit Profit before income tax Income tax expense Profit for the period Attributable to: Owner of Target Company E	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – –	Six months ended 30 June 2015 RMB’000 – – – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

			–

(C) STATEMENTS OF COMPREHENSIVE INCOME

Profit for the period Total comprehensive income for the period Attributable to: Owner of Target Company E	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–

			–

– VI-4 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

(D) STATEMENT OF CHANGES IN OWNERS’ EQUITY

As at 22 May 2014 As at 31 December 2014 As at 1 January 2015 Transactions with owners Capital contribution Total transactions with owners As at 30 June 2015 (unaudited) As at 22 May 2014 As at 30 June 2014	Attributable to owner of Target Company E Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – – – – – – 20,000 – – 20,000 20,000 – – 20,000 20,000 – – 20,000 Attributable to owner of Target Company E Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – – –	Total equity RMB’000 –
		–

		–
		20,000
		20,000
		20,000

		Total equity RMB’000 –
		–

– VI-5 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

(E) CASH FLOW STATEMENTS

Item Note Cash flows from operating activities Cash used in operations 8 Net cash used in operating activities Cash flows from financing activities Capital contribution received from owner Net cash generated from financing activities Net increase in cash Cash at beginning of the period Cash at end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – – – – –	Six months ended 30 June 2015 RMB’000 (20,000) (20,000) 20,000 20,000 – – –	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) –
			–
			–
			–
			– –
			–

– VI-6 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

II. NOTES TO THE FINANCIAL INFORMATION

1 GENERAL INFORMATION

Nanjing Radisson Real Estate Company Limited (“Target Company E”) was incorporated with limited liability in the PRC on 22 May 2014. The address of its registered office is No. 550 Zhongshan North Road, Gulou District, Nanjing, Jiangsu Province, the PRC.

Target Company E is principally engaged in property development services in the PRC.

These financial statements are presented in Renminbi (“RMB”), unless otherwise stated.

These financial statements have been approved for issue by the Board of Directors on 24 September 2015.

2 BASIS OF PREPARATION

The Financial Information has been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by Hong Kong Institute of Certified Public Accountants (“HKICPA”).

The Financial Information has been prepared under the historical cost convention.

HKFRS 1, First-time adoption of Hong Kong Financial Reporting Standards, has been applied in preparing these financial statements. As disclosed in Note 10, Target Company E has consistently applied the accounting policies used in the preparation of its opening HKFRS balance sheet at 31 December 2014 throughout all periods presented. Note 10 discloses the impact of adoption of HKFRS on Target Company E’s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in Target Company E’s financial statements prepared under Accounting Standards for Business Enterprises of the PRC (“CAS”).

Standards, amendments to standards and interpretations that are effective during the Relevant Periods have been adopted and applied by Target Company E consistently throughout the Relevant Periods.

There were no assets, equity or liabilities for Target Company E as at 22 May 2014 (date of establishment).

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below.

3.1 Changes in accounting policy and disclosures

New standards and interpretations not yet adopted

– VI-7 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

There are no other HKFRSs or HK (IFRIC) interpretations that are not yet effective that would be expected to have a material impact on Target Company E.

3.2 Land use rights

Land use rights are classified as current assets unless the construction period of the relevant property development project is expected to complete beyond normal operating cycle.

All lands in China mainland are state-owned and no individual land ownership right exists. Target Company E acquired the rights to use certain land and the premiums paid for such rights are recorded as land use rights.

The lease period of land use rights is between 40 to 70 years.

3.3 Cash

In the cash flow statement, cash includes cash in hand and deposits held at call with banks.

3.4 Paid-in capital

Paid-in capital is classified as equity.

3.5 Amounts due to a related party

The financial liabilities of Target Company E are amounts due to a related party, Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd (“Linjiang Old Town”).

Amounts due to Linjiang Old Town are recorded at amortised cost.

3.6 Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the country where Target Company E operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

– VI-8 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

4 FINANCIAL RISK MANAGEMENT

4.1 Financial risk factors

Target Company E’s activities expose it to liquidity risk. Target Company E’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on Target Company E’s financial performance. The board of directors reviews and approves policies for managing each of these risks and they are summarised below.

(a) Liquidity risk

Cash flow forecast is performed by Target Company E. The finance department of Target Company E monitors rolling forecasts of Target Company E’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that Target Company E does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecast takes into consideration Target Company E’s debt financing plans, covenant compliance (if applicable) and compliance with internal balance sheet ratio targets.

The table below analyses Target Company E’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amount disclosed in the table is the contractual undiscounted cash flows.

On demand RMB’000

As at 31 December 2014 Amounts due to a related party (Note 7) – As at 30 June 2015 Amounts due to a related party (Note 7) 348,310

4.2 Capital risk management

Target Company E’s objectives when managing capital are to safeguard Target Company E’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Management of Target Company E monitors capital for all companies owned by Linjiang Old Town (incorporated in the PRC) collectively. Target Company E utilises paid-in capital or shareholder loans to meet capital needs, if necessary, Target Company E will also provide fund to or receive fund from other project companies controlled by Linjiang Old Town.

5 FINANCIAL INSTRUMENTS BY CATEGORY

Other financial Liabilities at amortised cost RMB’000

Liabilities As at 31 December 2014 Amounts due to a related party (Note 7) As at 30 June 2015 Amounts due to a related party (Note 7)	–

	348,310

– VI-9 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

6 LAND USE RIGHTS

At beginning of the period Additions At end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – –	Six months ended 30 June 2015 RMB’000 – 368,310 368,310	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

(a) Land use rights are analysed as follows:

	As at	As at
	31 December	30 June
	2014	2015
	RMB’000	RMB’000
In the PRC, held on leases of:
Between 40 to 70 years	–	368,310

Land use rights are all located in the PRC.

The land use rights were initially acquired by Linjiang Old Town, which has paid for the relevant consideration. In April 2015, Target Company E, Linjiang Old Town and Nanjing Land Resources Bureau entered into an agreement (the “Agreement”). Pursuant to the Agreement, Target Company E obtained the title of the land use rights, and the respective consideration paid by Linjiang Old Town amounting to RMB368,310,000 was recorded as a payable to Linjiang Old Town.

7 AMOUNTS DUE TO A RELATED PARTY

			As at	As at
			31 December	30 June
			2014	2015
			RMB’000	RMB’000
Amounts	due	to a related party
Linjiang	Old	Town (Note 9(a))	–	348,310

(a) The carrying amount of amounts due to Linjiang Old Town approximates its fair value.

(b) Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

				As at	As at
			31	December	30 June
				2014	2015
				RMB’000	RMB’000
Within	1	year		–	348,310

– VI-10 –

ACCOUNTANT’S REPORT OF TARGET COMPANY E

APPENDIX VI

8 CASH USED IN OPERATIONS

Profit for the period Changes in working capital: – Amounts due to a related party Cash used in operations Non-cash transaction – Acquisition of land use rights by assuming liability to Linjiang Old Town (Note 6)	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – (20,000) (20,000) (368,310)	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – –
			–

			–

9 RELATED PARTIES AND RELATED PARTY TRANSACTIONS

The immediate holding company of Target Company E is Linjiang Old Town, which owns 100% of Target Company E’s equity interests. The ultimate holding company of Target Company E is China Metallurgical Corporation Limited (incorporated in the PRC).

(a) Amounts due to related parties:

Linjiang Old Town At beginning of the period Increase (Note 6) Decrease At end of the period	Period from 22 May 2014 to 31 December 2014 RMB’000 – – – –	Six months ended 30 June 2015 RMB’000 – 368,310 (20,000) 348,310	Period from 22 May 2014 to 30 June 2014 RMB’000 (unaudited) – – –
			–

Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

10 FIRST TIME ADOPTION OF HKFRS

This is Target Company E’s first Financial Information prepared in accordance with HKFRS.

The accounting policies set out in Note 3 have been applied in preparing the financial statements.

Reconciliations of CAS to HKFRS

HKFRS 1 requires an entity to reconcile equity, comprehensive income and cash flows for prior periods. Target Company E’s first-time adoption did not have any impact on the total operating, investing or financing cash flows, equity or total comprehensive income for Relevant Periods.

There is no reconciliation of CAS to HKFRS for Financial Information of Target Company E for Relevant Periods.

– VI-11 –

APPENDIX VI ACCOUNTANT’S REPORT OF TARGET COMPANY E

11 EVENTS AFTER THE BALANCE SHEET DATE

On 12 August 2015, a subsidiary of the Company and Linjiang Old Town entered into an equity transfer agreement (“Equity Transfer Agreement”). Pursuant to the Equity Transfer Agreement and subject to the approval by the SGM of the Company, 100% equity interests of Target Company E will be acquired by the subsidiary of the Company.

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by Target Company E in respect of any period subsequent to 30 June 2015 up to the date of this report. Save as disclosed in this report, no dividend or distribution has been declared or made by Target Company E in respect of any period subsequent to 30 June 2015.

Yours faithfully, PricewaterhouseCoopers Certified Public Accountants Hong Kong

– VI-12 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

24 September 2015

The Directors

Shanghai Zendai Property Limited

Dear Sirs,

We report on the financial information of Nanjing Zendai Delta Real Estate Company Limited (南京証大三角洲置業有限公司, “Target Company F”), which comprises the balance sheets of Target Company F as at 31 December 2014 and 30 June 2015, and the income statements, the statements of comprehensive income, the statements of changes in equity and the cash flow statements of Target Company F for the period from 13 February 2014 (date of establishment) to 31 December 2014 and the six months ended 30 June 2015 (the “Relevant Periods”) and a summary of significant accounting policies and other explanatory information. This financial information has been prepared by the directors of Shanghai Zendai Property Limited (the “Company”) and is set out in Sections I to III below for inclusion in Appendix VII to the circular of the Company dated 24 September 2015 (the “Circular”) in connection with the proposed acquisition of Target Company F by the Company (the “Transaction”).

Target Company F was incorporated in the People’s Republic of China (the “PRC”) on 13 February 2014 as a limited liability company under the Company Law of the PRC.

The financial statements of the Target Company F for the period ended 31 December 2014 were audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP. The directors of Target Company F during the Relevant Periods are responsible for the preparation and fair presentation of the financial statements in accordance with the Accounting Standards for Business Enterprises of the People’s Republic of China (“CAS”) issued by the China Ministry of Finance, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL INFORMATION

– VII-1 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

REPORTING ACCOUNTANT’S RESPONSIBILITY

OPINION

In our opinion, the financial information gives, for the purpose of this report, a true and fair view of the state of affairs of Target Company F as at 31 December 2014 and 30 June 2015 and of Target Company F’s results and cash flows for the Relevant Periods then ended.

REVIEW OF STUB PERIOD COMPARATIVE FINANCIAL INFORMATION

We have reviewed the stub period comparative financial information set out in Section I to II below included in Appendix VII to the Circular which comprises the income statement, the statement of comprehensive income, the statement of changes in equity and the cash flow statement of Target Company F for the period from 13 February 2014 to 30 June 2014 and a summary of significant accounting policies and other explanatory information (the “Stub Period Comparative Financial Information”).

– VII-2 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

I. FINANCIAL STATEMENTS OF TARGET COMPANY F

The following is the financial information of Target Company F prepared by the directors of the Company as at 31 December 2014 and 30 June 2015, and for the period from 13 February 2014 (date of establishment) to 31 December 2014, the six months ended 30 June 2015 and the period from 13 February 2014 to 30 June 2014 (the “Financial Information”):

(A) BALANCE SHEETS

Note Assets Current assets Land use rights 6 Cash 7 Total current assets Total assets Equity Paid-in capital Reserve Retained earnings Total equity Liabilities Current liabilities Amounts due to a related party 8 Income tax payable Total current liabilities Total liabilities Total equity and liabilities Net current assets Total assets less current liabilities	As at 31 December 2014 RMB’000 633,970 17 633,987 633,987 20,000 1 13 20,014 20,014 613,970 3 613,973 613,973 633,987 20,014 20,014	As at 30 June 2015 RMB’000 633,970 17
		633,987
		633,987

		20,000 1 13
		20,014
		20,014
		613,970 3
		613,973
		613,973
		633,987

		20,014

		20,014

– VII-3 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

(B) INCOME STATEMENTS

Note Administrative expenses 9 Other expenses Operating profit Finance income 10 Profit before income tax Income tax expense 11 Profit for the period Attributable to: Owner of Target Company F	Period from 13 February 2014 to 31 December 2014 RMB’000 (10) (1) (11) 30 19 (5) 14 14	Six months ended 30 June 2015 RMB’000 – – – – – – – –	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) – (1) (1) 9 8 (2) 6 6

(C) STATEMENTS OF COMPREHENSIVE INCOME

Profit for the period Total comprehensive income for the period Attributable to: Owner of Target Company F	Period from 13 February 2014 to 31 December 2014 RMB’000 14 14 14	Six months ended 30 June 2015 RMB’000 – – –	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) 6
			6

			6

– VII-4 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

(D) STATEMENT OF CHANGES IN OWNERS’ EQUITY

As at 13 February 2014 Comprehensive income Profit for the period Total comprehensive income Transactions with owners Capital contribution Appropriations Total transactions with owners As at 31 December 2014 As at 1 January 2015 As at 30 June 2015 (Unaudited) As at 13 February 2014 Comprehensive income Profit for the period Total comprehensive income Transactions with owners Capital contribution Total transactions with owners As at 30 June 2014	Attributable to owner of Target Company F Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – 14 14 – – 14 14 20,000 – – 20,000 – 1 (1) – 20,000 1 (1) 20,000 20,000 1 13 20,014 20,000 1 13 20,014 20,000 1 13 20,014 Attributable to owner of Target Company F Paid-in capital Surplus reserve Retained earnings Total RMB’000 RMB’000 RMB’000 RMB’000 – – – – – – 6 6 – – 6 6 20,000 – – 20,000 20,000 – – 20,000 20,000 – 6 20,006	Total equity RMB’000 – 14
		14
		20,000 –
		20,000
		20,014

		20,014

		20,014

		Total equity RMB’000 – 6
		6
		20,000
		20,000
		20,006

– VII-5 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

(E) CASH FLOW STATEMENTS

Item Note Cash flows from operating activities Cash used in operations 12 Income tax paid Net cash used in operating activities Cash flows from financing activities Capital contribution received from owner Net cash generated from financing activities Net increase in cash Cash at beginning of the period Cash at end of the period	Period from 13 February 2014 to 31 December 2014 RMB’000 (19,981) (2) (19,983) 20,000 20,000 17 – 17	Six months ended 30 June 2015 RMB’000 – – – – – 17 – 17	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) (9,992) – (9,992) 20,000 20,000 10,008 – 10,008

– VII-6 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

II. NOTES TO THE FINANCIAL INFORMATION

1 GENERAL INFORMATION

Nanjing Zendai Delta Real Estate Company Limited (“Target Company F”) was incorporated with limited liability in the PRC on 13 February 2014. The address of its registered office is No. 550 Zhongshan North Road, Gulou District, Nanjing, Jiangsu Province, the PRC.

Target Company F is principally engaged in property development services in the PRC.

These financial statements are presented in Renminbi (“RMB”), unless otherwise stated.

These financial statements have been approved for issue by the Board of Directors on 24 September 2015.

2 BASIS OF PREPARATION

The Financial Information has been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by Hong Kong Institute of Certified Public Accountants (“HKICPA”).

The Financial Information has been prepared under the historical cost convention.

HKFRS 1, First-time adoption of Hong Kong Financial Reporting Standards, has been applied in preparing these financial statements. As disclosed in Note 14, Target Company F has consistently applied the accounting policies used in the preparation of its opening HKFRS balance sheet at 31 December 2014 throughout all periods presented. Note 14 discloses the impact of adoption of HKFRS on Target Company F’s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in Target Company F’s financial statements prepared under Accounting Standards for Business Enterprises of the PRC (“CAS”).

Standards, amendments to standards and interpretations that are effective during the Relevant Periods have been adopted and applied by Target Company F consistently throughout the Relevant Periods.

There were no assets, equity or liabilities for Target Company F as at 13 February 2014 (date of establishment).

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below.

3.1 Changes in accounting policy and disclosures

New standards and interpretations not yet adopted

– VII-7 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

There are no other HKFRSs or HK (IFRIC) interpretations that are not yet effective that would be expected to have a material impact on Target Company F.

3.2 Land use rights

Land use rights are classified as current assets unless the construction period of the relevant property development project is expected to complete beyond normal operating cycle.

All lands in China mainland are state-owned and no individual land ownership right exists. Target Company F acquired the rights to use certain land and the premiums paid for such rights are recorded as land use rights.

The lease period of land use rights is between 40 to 70 years.

3.3 Cash

In the cash flow statement, cash includes cash in hand and deposits held at call with banks.

3.4 Paid-in capital

Paid-in capital is classified as equity.

3.5 Amounts due to a related party

The financial liabilities of Target Company F are amounts due to a related party, Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd (“Linjiang Old Town”).

Amounts due to Linjiang Old Town are recorded at amortised cost.

3.6 Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the country where Target Company F operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

– VII-8 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

4 FINANCIAL RISK MANAGEMENT

4.1 Financial risk factors

Target Company F’s activities expose it to a variety of financial risks: credit risk and liquidity risk. Target Company F’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on Target Company F’s financial performance. The board of directors reviews and approves policies for managing each of these risks and they are summarised below.

(a) Credit risk

Credit risk arises from cash. The carrying amounts of cash represent Target Company F’s maximum exposure to credit risk in relation to its financial assets.

To manage such exposure, Target Company F has policies in place to ensure that deposits are placed with banks with appropriate credit ratings. Target Company F has no significant concentration of credit risk.

(b) Liquidity risk

Cash flow forecast is performed by Target Company F. The finance department of Target Company F monitors rolling forecasts of Target Company F’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that Target Company F does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecast takes into consideration Target Company F’s debt financing plans, covenant compliance (if applicable) and compliance with internal balance sheet ratio targets.

The table below analyses Target Company F’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amount disclosed in the table is the contractual undiscounted cash flows.

As at 31 December 2014 Amounts due to a related party (Note 8) As at 30 June 2015 Amounts due to a related party (Note 8)	On demand RMB’000 613,970

	613,970

4.2 Capital risk management

Target Company F’s objectives when managing capital is to safeguard Target Company F’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

Management of Target Company F monitors capital for all companies owned by Linjiang Old Town (incorporated in the PRC) collectively. Target Company F utilises paid-in capital or shareholder loans to meet capital needs, if necessary, Target Company F will also provide fund to or receive fund from other project companies controlled by Linjiang Old Town.

– VII-9 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

5 FINANCIAL INSTRUMENTS BY CATEGORY

Assets As at 31 December 2014 Cash (Note 7) As at 30 June 2015 Cash (Note 7) Liabilities As at 31 December 2014 Amounts due to a related party (Note 8) As at 30 June 2015 Amounts due to a related party (Note 8)	Loans and receivables RMB’000 17

	17

	Other financial liabilities at amortised cost RMB’000 613,970

	613,970

6 LAND USE RIGHTS

Period from 13 February 2014 to 31 December 2014 RMB’000 At beginning of the period – Additions 633,970 At end of the period 633,970 (a) Land use rights are analysed as follows: In the PRC, held on leases of: Between 40 to 70 years	Six months ended 30 June 2015 RMB’000 633,970 – 633,970 As at 31 December 2014 RMB’000 633,970	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) – 633,970
		633,970

		As at 30 June 2015 RMB’000 633,970

Land use rights are all located in the PRC.

The land use rights were initially acquired by Linjiang Old Town, which has paid for the relevant consideration. In May 2014, Target Company F, Linjiang Old Town and Nanjing Land Resources Bureau entered into an agreement (the “Agreement”). Pursuant to the Agreement, Target Company F obtained the title of the land use rights, and the respective consideration paid by Linjiang Old Town amounting to RMB633,970,000 was recorded as a payable to Linjiang Old Town.

– VII-10 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

7 CASH

Short-term bank deposits Denominated in: – RMB	As at 31 December 2014 RMB’000 17 17	As at 30 June 2015 RMB’000 17

		17

The effective interest rate on short-term bank deposits is 0.35% per annum as at 31 December 2014 and 30 June 2015.

8 AMOUNTS DUE TO A RELATED PARTY

			As at	As at
			31 December	30 June
			2014	2015
			RMB’000	RMB’000
Amounts	due	to a related party
Linjiang	Old	Town (Note 13(a))	613,970	613,970

(a) The carrying amount of amounts due to Linjiang Old Town approximates its fair value.
(b) Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.
(c) An ageing analysis of amounts due to Linjiang Old Town is as follows:

Within 1 year Between 1 year to 2 years Total	As at 31 December 2014 RMB’000 613,970 – 613,970	As at 30 June 2015 RMB’000 – 613,970
		613,970

9 EXPENSES BY NATURE

Expenses by nature comprised administrative expenses as follows:

			Period from		Period from
		13	February 2014	Six months	13 February 2014
		to 31 December		ended 30 June	to 30 June
			2014	2015	2014
			RMB’000	RMB’000	RMB’000
					(unaudited)
Stamp	tax		10	–	–

– VII-11 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

10 FINANCE INCOME

			Period from		Period from
		13	February 2014	Six months	13 February 2014
		to 31 December		ended 30 June	to 30 June
			2014	2015	2014
			RMB’000	RMB’000	RMB’000
					(unaudited)
Interest	income		30	–	9

11 INCOME TAX EXPENSE

Target Company F is subjected to PRC enterprise income tax, which has been provided based on the statutory income tax rate of 25% of the assessable income of Target Company F for the period from 13 February 2014 to 31 December 2014, the six months ended 30 June 2015 and the period from 13 February 2014 to 30 June 2014.

		Period from		Period from
	13	February 2014	Six months	13 February 2014
	to 31 December		ended 30 June	to 30 June
		2014	2015	2014
		RMB’000	RMB’000	RMB’000
				(unaudited)
Current income tax
– PRC enterprise income tax		5	–	2

The reconciliation from income tax calculated based on the applicable tax rates and total profit presented in the financial statements to the income tax expenses is listed below:

Profit for the period Tax calculated at a tax rate of 25%	Period from 13 February 2014 to 31 December 2014 RMB’000 19 5 5	Six months ended 30 June 2015 RMB’000 – – –	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) 8
			2 2

– VII-12 –

ACCOUNTANT’S REPORT OF TARGET COMPANY F

APPENDIX VII

12 CASH USED IN OPERATIONS

Profit for the period Adjustment for: – Income tax expense (Note 11) Changes in working capital: – Amounts due to a related party Cash used in operations Non-cash transaction – Acquisition of land use rights by assuming liability to Linjiang Old Town (Note 6)	Period from 13 February 2014 to 31 December 2014 RMB’000 14 5 (20,000) (19,981) (633,970)	Six months ended 30 June 2015 RMB’000 – – – – –	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) 6 2 (10,000) (9,992) (633,970)

13 RELATED PARTIES AND RELATED PARTY TRANSACTIONS

The immediate holding company of Target Company F is Linjiang Old Town, which owns 100% of Target Company F’s equity interests. The ultimate holding company of Target Company F is China Metallurgical Corporation Limited (incorporated in the PRC).

(a) Amounts due to related parties:

Linjiang Old Town At beginning of the period Increase (Note 6) Decrease At end of the period	Period from 13 February 2014 to 31 December 2014 RMB’000 – 633,970 (20,000) 613,970	Six months ended 30 June 2015 RMB’000 613,970 – – 613,970	Period from 13 February 2014 to 30 June 2014 RMB’000 (unaudited) – 633,970 (10,000) 623,970

Amounts due to Linjiang Old Town are unsecured, interest free, and repayable on demand.

14 FIRST TIME ADOPTION OF HKFRS

This is Target Company F’s first Financial Information prepared in accordance with HKFRS.

The accounting policies set out in Note 3 have been applied in preparing the financial statements.

Reconciliations of CAS to HKFRS

HKFRS 1 requires an entity to reconcile equity, comprehensive income and cash flows for prior periods. Target Company F’s first-time adoption did not have any impact on the total operating, investing or financing cash flows, equity or total comprehensive income for Relevant Periods.

There is no reconciliation of CAS to HKFRS for Financial Information of Target Company F for Relevant Periods.

– VII-13 –

APPENDIX VII ACCOUNTANT’S REPORT OF TARGET COMPANY F

15 EVENTS AFTER THE BALANCE SHEET DATE

On 12 August 2015, a subsidiary of the Company and Linjiang Old Town entered into an equity transfer agreement (“Equity Transfer Agreement”). Pursuant to the Equity Transfer Agreement and subject to the approval by the SGM of the Company, 100% equity interests of Target Company F will be acquired by the subsidiary of the Company.

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by Target Company F in respect of any period subsequent to 30 June 2015 up to the date of this report. Save as disclosed in this report, no dividend or distribution has been declared or made by Target Company F in respect of any period subsequent to 30 June 2015.

Yours faithfully, PricewaterhouseCoopers Certified Public Accountants Hong Kong

– VII-14 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

MANAGEMENT DISCUSSION AND ANALYSIS ON THE GROUP

Set out below is the management discussion and analysis of the Group for each of the three years ended 31 December 2012, 2013 and 2014 and for the six months ended 30 June 2015.

For the year ended 31 December 2012

Review of operations

The results of the Group for the year under review was satisfactory. The turnover and profit for the year were mainly attributable to sales and delivery of residential units in Changchung, Jilin, Haimen and gain on disposal of the Bund project. The Group continued to offer both residential and commercial properties for sale. For commercial projects, they were office premises in Zendai International Financial Centre in Hainan. In respect of residential projects, they were apartments, villas and detached houses in Haimen, Jilin, Changchun, Qingdao and Zhujiajiao Town (Qingpu District, Shanghai).

Liquidity, financial resources and gearing

As at 31 December 2012, the Group had a healthy financial position with net assets value of HK$5,800 million which remained stable when compared to last year’s net assets value of approximately HK$5,813 million. Net current assets amounted to approximately HK$5,943 million (2011: approximately HK$3,834 million) with current ratio increased from 1.42 times in 2011 to approximately 2.06 times in 2012. As at 31 December 2012, the Group had consolidated bank loans of approximately HK$4,956 million in which HK$1,325 million was repayable within one year and HK$3,631 million was repayable within more than one year. The amount of HK$2,242.06 million out of such bank loans was at a fixed interest rate of 5.81% while the remaining of HK$2,714.62 million was at floating interest rate with an effective interest rate of 5.82%. Such bank loans were mainly denominated in HK$, RMB and US$. As at 31 December 2012, the Group’s bank balances and cash were approximately HK$2,826 million, which were mainly denominated in HK$, RMB and US$. The gearing ratio of the Group increased from 0.67 times in 2011 to 0.89 times in 2012 (basis: total of amounts due to related companies, bank loans, notes payable and other borrowings divided by Shareholders’ funds).

Capital structure

The Group had no debt securities or other capital instruments as at 31 December 2012.

The Group adopted relatively prudent financial and treasury policies and closely monitored its cash flow. The Group’s primary objective when managing capital is to safeguard the Group’s ability to continue as a going concern, so that it can continue to provide returns for Shareholders and benefits for other stakeholders. The Group actively and regularly reviews

– VIII-1 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

and manages its capital structure to maintain a balance between the higher shareholders’ returns that might be possible with higher levels of borrowings and the advantages and security afforded by a sound capital position, and makes adjustments to the capital structure in light of changes in economic conditions. Consistent with industry practice, the Group monitors its capital structure on the basis of a net debt-to-adjusted capital ratio. For this purpose the Group defines net debts as total debt (which comprises non-current other payables, bank loans, other borrowing, entrusted loan payables and senior loan notes less cash and cash equivalents and pledged bank deposits). Adjusted capital comprises all components of equity. During the year, the Group’s strategy was to maintain the net debt-to-adjusted capital ratio at the lower end of the range 60% to 70%. In order to maintain or adjust the ratio, the Group may adjust the amount of dividends paid to shareholders, issue new shares, return capital to shareholders, raise new debt financing or sell assets to reduce debt. The Group’s overall strategy remains unchanged from prior year.

Contingent liabilities

As at 31 December 2012, the Group provided guarantees to the extent of approximately HK$246,505,000 (2011: 383,999,000) to banks in respect of mortgage loans provided by the banks to customers for the purchase of the developed properties of the Group. These guarantees provided by the Group to the banks would be released upon receiving the building ownership certificates of the respective properties by the banks from the customers as a pledge for security to the mortgage loans granted.

In the opinion of the directors, the fair value of guarantee contracts is insignificant at initial recognition.

Segment information

Sale of properties

The turnover of this segment for the year amounted to HK$685,521,000 (2011: HK$2,391,143,000) which decreased substantially due to less delivery of properties.

Travel and related business

The turnover of this segment for the year reached approximately HK$16,439,000 (2011: HK$12,692,000).

Property rental, management and agency services

The turnover of this segment for the year was approximately HK$277,915,000 (2011: HK$240,837,000). The increase was due to the fact that more properties were available for leasing and managed by the Group.

Hotel operations

The turnover of this segment for the year was HK$143,016,000 (2011: 151,624,000). The decrease was due to that more hotels opened business during the year and therefore with greater competition.

– VIII-2 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Foreign currency exposures

The operations of the Group were mainly carried out in the PRC with most transactions settled in RMB. The Group undertook certain transactions denominated in currencies other than RMB, hence exposures to exchange rate fluctuations arose. The Group’s cash and cash equivalents and senior loan notes were also exposed to such foreign currency risk. The Group did not use any derivative contracts to hedge against its exposure to currency risk. The Group managed its foreign currency risk by closely monitoring the movement of the foreign currency rate.

Employees

As at 31 December 2012, the Group employed approximately 1,680 employees (2011: 1,450 employees) in Hong Kong and the PRC. Staff costs including directors’ emoluments for the year ended 31 December 2012 amounted to approximately HK$153.43 million (2011: HK$182.48 million). They were remunerated according to the nature of the job and market conditions. Other staff benefits include a mandatory provident fund scheme, local municipal government retirement scheme, insurance and medical insurance and share option scheme.

Major disposal of assets

(a) On 28 October 2011, Shanghai Zendai Land Company Limited (“Shanghai Zendai Land”), a wholly-owned subsidiary of the Company, entered into an agreement with Shanghai Haizhimen Property Management Co., Ltd. (“Shanghai Haizhimen”), an associate of the Group on that date, for disposal of its 100% equity interests in and shareholder’s loan to Shanghai Zendai Bund International Finance Services Centre Real Estate Company Limited (“Shanghai Zendai Bund”). The disposal was completed on 21 May 2012, on which date the Group lost control of Shanghai Zendai Bund. Total consideration was approximately HK$10,547,287,000 (equivalent to approximately RMB8,578,108,000), of which approximately HK$10,499,925,000 (equivalent to approximately RMB8,539,589,000) was received on 31 December 2012.
(b) On 29 December 2011, Shanghai Zendai Land entered into another agreement with an independent third party (“Purchaser”) for disposal of its equity interests in and shareholder’s loan to Shanghai Zendai Wudaokou Property Company Limited (“Shanghai Zendai Wudaokou”). Pursuant to the agreement and related supplemental agreements, Shanghai Zendai Wudaokou will transfer all of its assets and liabilities (other than its equity interests in and loan to Shanghai Haizhimen and its shareholder’s loan from Shanghai Zendai Land) to other companies in the Group (“Spin-off”) and the Spin-off can be completed after the Shanghai Zendai Wudaokou is disposed to the Purchaser. The total cash consideration was approximately HK$3,639,493,000 (equivalent to approximately RMB2,960,000,000), of which HK$3,516,537,000 was received on 31 December 2012. The disposal was completed

– VIII-3 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

on 21 May 2012, on which date the Group lost control of Shanghai Zendai Wudaokou and all conditions precedent to the agreement were satisfied. As at the date of the annual report of the Company for the year ended 31 December 2012, the Spin-off has not been completed.

Major acquisition of assets

On 29 June 2012 the Group succeeded in a bid for the land parcel in Nanjing, the PRC, at an aggregate price of RMB1,169,000,000 (equivalent to approximately HK$1,437,870,000) and the land use rights grant contract was signed in January 2013.

The land parcel is located in the commercial core area around Nanjing South Train Station, and covers a total site area of 93,526.4 sq. m. with planned above-ground spaces in the gross floor area of approximately 380,000 sq. m. and underground spaces in the gross floor area of approximately 160,000 sq. m., has the land use rights with a term of 40 years. The terms for the grant of the land use rights of the land parcel for office use and commercial use are both 40 years.

Charge on assets

As at 31 December 2012, the Group’s property, plant and equipment, payment for leasehold land held for own use under operating leases, investment properties, properties under development and for sales and pledged bank deposits of approximately HK$343,286,000, HK$619,904,000, HK$2,285,078,000, HK$1,500,587,000 and HK$1,317,421,000 respectively had been pledged to banks to secure bank loans granted to the Group.

At 31 December 2012, the Group pledged 45% equity interest in 南京証大大拇指商業發展有限公司 (Nanjing Zendai Thumb Plaza Development Co., Ltd*), with attributable carrying amount of approximately HK$272,275,000 (2011: nil) to secure a bank loan granted to the Group.

At 31 December 2012, the Group also pledged 45% equity interest in Shanghai Zendai Himalayas Real Estate Company Limited with attributable carrying amount of approximately HK$361,505,000 (2011: HK$418,598,000) to Shanghai Forte Land Co., Ltd. (“Shanghai Forte”), an equity holder of a former associate of the Group, for securing Shanghai Forte’s interests in Shanghai Haizhimen.

At 31 December 2011, the Group pledged its 10% interests in Shanghai Haizhimen with carrying amount HK$122,369,000, and a subsidiary, 上海証大西鎮房地產開發有限公司 (“Shanghai Zendai Xi Zhen Property Development Co., Ltd*”) with carrying amount of HK$482,039,000 for a borrowing of the Group. The pledges were released upon settlement of the borrowing during the year.

Litigation

On 4 June 2012, each of Shanghai Zendai Land, a wholly-owned subsidiary of the Company, and Shanghai Zendai Wudaokou, a former wholly-owned subsidiary of Shanghai Zendai Land, was served a document of summons issued by Shanghai No. 1 Intermediate

– VIII-4 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

People’s Court in relation to disputes on asset damage and compensation and the alleged breach of pre-emptive rights in shareholding of Shanghai Haizhimen, a former associate with 35% equity interest held by the Group, initiated by Zhejiang Fosun Commerce Development Limited (“Zhejiang Fosun”).

Pursuant to the statement of claims issued by Zhejiang Fosun as attached to the document of summons, among others, (i) Shanghai Zendai Land and Shanghai Zendai Wudaokou were named as two of the defendants to the Claims; (ii) Zhejiang Fosun requested order be made to invalidate the agreement on disposal of Shanghai Zendai Wudaokou; (iii) Zhejiang Fosun requested order be made to invalidate the share transfer agreement relating to the transfer of the entire equity interests of Shanghai Zendai Wudaokou to an independent third party; and (iv) Zhejiang Fosun requested order be made such that the ownership of Shanghai Zendai Wudaokou be restated to the state prior to the transfer. (ii) to (iv) above are referred to as the “Claims”.

At the court hearing as regards the Claims on 29 November 2012, the court had awarded no judgment in relation to the Claims. At the final stage of the aforesaid court hearing, the parties to the Claims agreed to participate in mediation held by the court, whereupon the parties shall try to agree on solutions to the Claims and the court will further award a judgement if solutions may be reached. In the event no agreement has been reached by the parties to the Claims as regards the solutions, the court will finally award a judgment. As at the date of the annual report of the Company for the year ended 31 December 2012, no agreement has been reached by the parties to the Claims.

The directors, after seeking advice from the Group’s PRC legal adviser, King & Wood Mallesons, take the view that the disposal of Shanghai Zendai Wudaokou did not involve the transfer of equity interest in Shanghai Haizhimen and therefore did not constitute a breach of any pre-emptive rights. The directors consider the Claims were without bases and do not have any material adverse effect on the operation or financial position of the Group.

Future plans for material investments and acquisition of capital assets

Save as disclosed above, the Group did not have any specific plan for material investments and acquisition of material capital assets as at 31 December 2012.

For the year ended 31 December 2013

Review of operations

The results of the Group for the year under review was unsatisfactory mainly attributable to the absence of the one-off gain on the disposal of subsidiaries in last year and the increase of finance cost during the period. The turnover and profit for the year were mainly attributable to sales and delivery of residential and commercial units in Qingdao, Shanghai, Changchun, Jilin Haimen and the tax credit as a result of the reverse of over-provision of LAT and deferred tax in prior years. The Group continued to offer both residential and commercial properties for sales. Except for projects in Qingdao, Shanghai, Changchun and Haimen, the Group would commence pre-sale of the properties in Nanjing and in South Africa.

– VIII-5 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Liquidity, financial resources and gearing

As at 31 December 2013, the Group had a healthy financial position with net assets value increased from approximately HK$5,800 million in 2012 to approximately HK$6,631 million. Net current assets amounted to approximately HK$4,415 million (2012: approximately HK$5,942 million) with current ratio decreased from 2.06 times in 2012 to approximately 1.57 times in 2013. As at 31 December 2013, the Group had consolidated bank loans of approximately HK$6,145 million in which HK$3,459 million was repayable within one year and HK$2,686 million was repayable within more than one year. The amount of HK$2,757.76 million out of such bank loans was at a fixed interest rate of 4.81% while the remaining of HK$3,386.92 million was at floating interest rate with an effective interest rate of 5.73%. Such bank loans were mainly denominated in HK$, RMB and US$. As at 31 December 2013, the Group’s bank balances and cash were approximately HK$2,514 million, which were mainly denominated in HK$, RMB and US$. The gearing ratio of the Group decreased from 0.89 times in 2012 to 0.81 times in 2013 (basis: total of amounts due to related companies, amount due to a joint venture, bank loans, notes payable and other borrowings divided by Shareholders’ funds).

Capital structure

The Group had no debt securities or other capital instruments as at 31 December 2013.

The Group adopted relatively prudent financial and treasury policies and closely monitored its cash flow. The Group’s overall strategy remains unchanged from prior year.

Segment information

Sales of properties

The turnover of this segment for the year amounted to approximately HK$1,710,340,000 (2012: approximately HK$685,521,000) which increased substantially due to more properties were delivered.

Travel and related business

The turnover of this segment for the year reached approximately HK$11,639,000 (2012: approximately HK$16,439,000).

Property rental, management and agency services

The turnover of this segment for the year was approximately HK$360,701,000 (2012: approximately HK$277,915,000). The increase was due to more properties were available for leasing and managed by the Group.

Hotel operations

The turnover of this segment for the year was approximately HK$144,983,000 (2012: approximately HK$143,016,000) which remained stable.

– VIII-6 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Foreign currency exposures

The operations of the Group were mainly carried out in the PRC with most transactions settled in RMB. The Group undertook certain transactions denominated in currencies other than RMB, hence exposures to exchange rate fluctuations arose. The Group’s cash and cash equivalents were also exposed to such foreign currency risk. The Group did not use any derivative contracts to hedge against its exposure to currency risk. The Group managed its foreign currency risk by closely monitoring the movement of the foreign currency rate.

Employees

As at 31 December 2013, the Group employed approximately 1,610 employees (2012: 1,680 employees) in Hong Kong and the PRC. Staff costs including directors’ emoluments for the year ended 31 December 2013 amounted to approximately HK$152.60 million (2012: HK$153.43 million). They were remunerated according to the nature of the job and market conditions. Other staff benefits include a mandatory provident fund scheme, local municipal government retirement scheme, insurance and medical insurance and share option scheme.

Charge of assets

(a) At the end of reporting period, the carrying amounts of the following assets of the Group were pledged to secure certain bank loans and payment guarantees granted to the Group.

Property, plant and equipment Payment for leasehold land held for own use under operating leases Investment properties Properties under development and for sales Pledged bank deposits	2013 HK$’000 341,852 617,316 2,473,761 1,118,894 1,571,342 6,123,165	2012 HK$’000 343,286 619,904 2,285,078 1,500,587 1,317,421
		6,066,276

(b) At 31 December 2013, the Group pledged certain properties under development and for sales with carrying amount of HK$482,295,000 (2012: nil) from its joint venture, 文廣証大南通文化投資發展有限公司 (Man Kwong Zendai Nantung Wenfa Investment Co. Ltd*), for a bank loan of the Group which has not been drawn down as at 31 December 2013.

– VIII-7 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

(c) At 31 December 2012, the Group pledged 45% equity interest in Shanghai Himalayas Real Estate Company Limited, an associate of the Group, with attributable carrying amount of approximately HK$361,505,000 to Shanghai Forte Land Co., Ltd. (“Shanghai Forte”), an equity holder of a former associate of the Group, for securing Shanghai Forte’s interests in Shanghai Haizhimen. The pledge was released during the year.

Major acquisition of assets

In November 2013, the Group signed a contract to acquire a real estate project located in Johannesburg, South Africa, with an area of approximately 1,600 hectares, at a total consideration of approximately ZAR1,060,980,000 (equivalent to approximately HK$838,170,000). The project is favourably located in Modderfontein, which is situated between Sandton and OR Tambo International Airport in Johannesburg, posing tremendous potential for development. Details of the transaction was announced in the Company’s announcement dated 5 November 2013. The transaction was completed on 20 March 2014.

Major disposal of assets

On 16 November 2012, the Group has entered into an agreement with an independent third party (“Venturer”) to dispose of its 10% equity interest in 南京証大大拇指商業發展有限公司 (Nanjing Zendai Thumb Plaza Development Co., Ltd*) (“Nanjing Zendai”). The transaction led to the reduction of the Group’s equity interests in Nanjing Zendai from 100% to 90%. Pursuant to the relevant agreement, Nanjing Zendai will be jointly controlled by the Group and the Venturer and therefore become a joint venture of the Group. The disposal was completed on 5 January 2013, on which date the Group lost control of Nanjing Zendai and all conditions precedent to the agreement were satisfied.

Contingent liabilities

As at 31 December 2013, the Group provided guarantees to the extent of approximately HK$346,715,000 (2012: HK$246,505,000) to banks in respect of mortgage loans provided by the banks to customers for the purchase of the developed properties of the Group. These guarantees provided by the Group to the banks would be released upon receiving the building ownership certificates of the respective properties by the banks from the customers as a pledge for security to the mortgage loans granted.

The Group also shared contingent liabilities of a joint venture arising from guarantees provided by the joint venture to banks to the extent of approximately HK$23,272,000 (2012: nil) in respect of mortgage loans provided by the banks to customers for the purchase of the developed properties of the joint venture. These guarantees provided by the Group and the joint venture to the banks would be released upon receiving the building ownership certificates of the respective properties by the banks from the customers as a pledge for security to the mortgage loans granted.

In the opinion of the directors, the fair value of guarantee contracts is insignificant at initial recognition.

– VIII-8 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Future plans for material investments and acquisition of capital assets

Save as disclosed above, the Group did not have any specific plan for material investments and acquisition of material capital assets as at 31 December 2013.

For the year ended 31 December 2014

Review of operations

As the land and property projects acquired in the past 2 years were still in the planning and development stages and could not be launched into the market for sales and delivery, the turnover for the year were mainly attributable to sales and delivery of pre-existing residential and commercial projects in Qingdao Thumb Plaza, Xizhen, Jilin and Haimen.

The results of the Group for the year under review were unsatisfactory. Despite there was a tax credit of approximately HK$525 million due to the reverse of over provision of LAT in previous years, the Group still sustained substantial loss due to a specific provision for diminution in value of the property project under development in Ordos of approximately HK$321 million, substantial increase in finance cost, increase in the share of net loss of associates and joint venture companies and a significant decrease in turnover due to less properties were delivered during the year.

Liquidity, financial resources and gearing

As at 31 December 2014, the Group had a healthy financial position with net assets value of HK$6,277 million (2013: approximately HK$6,631 million). Net current assets amounted to approximately HK$7,595 million (2013: approximately HK$4,415 million) with current ratio increased from 1.57 times in 2013 to approximately 1.97 times in 2014. As at 31 December 2014, the Group had consolidated bank loans of approximately HK$7,888 million in which HK$3,338 million was repayable within one year and HK$4,550 million was repayable within more than one year. The amount of HK$2,621.23 million out of such bank loans was at a fixed interest rate of 9.08% while the remaining of HK$5,266.64 million was at floating interest rate with an effective interest rate of 6.06%. Such bank loans were mainly denominated in HK$, RMB and US$. As at 31 December 2014, the Group’s bank balances and cash were approximately HK$1,873 million, which were mainly denominated in HK$, RMB, US$ and ZAR. The gearing ratio of the Group increased from 0.81 times in 2013 to 1.38 times in 2014 (basis: total of amounts due to related companies, bank loans, notes payable and other borrowings divided by Shareholders’ funds).

Capital structure

The Group had no debt securities or other capital instruments as at 31 December 2014.

There was no change on capital structure of the Group during the year ended 31 December 2014. The Group’s overall strategy remains unchanged from prior year.

– VIII-9 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Segment information

Sales of properties

The turnover of this segment for the year amounted to HK$990,358,000 (2013: HK$1,710,340,000) which decreased substantially due to less properties were delivered.

Travel and related business

The turnover of this segment for the year reached approximately HK$8,950,000 (2013: HK$11,639,000).

Property rental, management and agency services

The turnover of this segment for the year was approximately HK$406,452,000 (2013: HK$360,701,000). The increase was due to more properties were available for leasing and managed by the Group.

Hotel operations

The turnover of this segment for the year was HK$173,852,000 (2013: HK$144,983,000) which increased by 20% due to the commencement of soft operation of Qingdao Himalayas hotel in March 2014.

Foreign currency exposures

The operations of the Group were mainly carried out in the PRC with most transactions settled in RMB. The Group undertook certain transactions denominated in currencies other than RMB, hence exposures to exchange rate fluctuations arose. The Group’s cash and cash equivalents were also exposed to such foreign currency risk. The Group did not use any derivative contracts to hedge against its exposure to currency risk. The Group managed its foreign currency risk by closely monitoring the movement of the foreign currency rate.

Employees

As at 31 December 2014, the Group employed approximately 2,106 employees (2013: 1,610 employees) in Hong Kong, South Africa and the PRC. They were remunerated according to the nature of the job and market conditions. Staff costs including directors’ emoluments for the year ended 31 December 2014 amounted to approximately HK$173.35 million (2013: HK$152.60 million). Other staff benefits include a mandatory provident fund scheme, local municipal government retirement scheme, insurance and medical insurance and share option scheme.

– VIII-10 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Major acquisition of assets

(a) In November 2013, the Group acquired a real estate project located in Johannesburg, South Africa, with an area of approximately 1,600 hectares, at a total consideration of approximately ZAR1,060,980,000 (equivalent to approximately HK$838,170,000). The project is favourably located in Modderfontein, which is situated between Sandton and OR Tambo International Airport in Johannesburg, posing tremendous potential for development. Details of the transaction was announced in the Company’s announcement dated 5 November 2013 and the transaction was completed in March 2014.
(b) On 6 March 2014, the Group succeeded in a bid and signed the share transfer agreement for the purchase of the entire share capital of 南京立方置業有限公司 (Nanjing Lifang Property Company Limited*) which owns a parcel of land located in Nanjing, Jiangsu Province, the PRC with site area of approximately 13,220.1 sq. m. which is designated for commercial and office mixed use. The purchase consideration is RMB902,300,000 (equivalent to approximately HK$1,127,900,000).
(c) On 20 November 2014, the Group won the tender and entered into an agreement as the purchaser to acquire all the share capital of a company incorporated in PRC and the shareholder’s loan of RMB685.51 million for a total consideration of RMB1,043.21 million. The principal asset owned by the PRC company is a parcel of land located in Nanjing, Jiangsu Province, the PRC with site area of approximately 26,901.54 sq. m., which is designated for commercial and office mixed use.

Major disposal of assets

On 24 March 2014, the Group entered into a sale and purchase agreement as vendor to dispose 20% of an indirect wholly-owned subsidiary, Richtex Holdings Limited, for RMB200,000,000 (equivalent to approximately HK$256,410,000). The principal asset owned by Richtex Holdings Limited is a parcel of land located in Nanjing, Jiangsu Province, the PRC with site area of approximately 93,526.4 sq. m., which is designated for integrated office, commercial, financial, hotel and cultural use.

– VIII-11 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Charge of assets

At the end of reporting period, the carrying amounts of following assets of the Group were pledged to secure certain bank loans and payment guarantees granted to the Group, the carrying amount of the assets were analysed below:

Property, plant and equipment Payment for leasehold land held for own use under operating leases Investment properties Properties under development and for sales Pledged bank deposits	2014 HK$’000 605,191 625,700 2,576,904 1,716,890 775,425 6,300,110	2013 HK$’000 341,852 617,316 2,473,761 1,118,894 1,571,342
		6,123,165

Future plans for material investments and acquisition of capital assets

Save as disclosed above, the Group did not have any specific plan for material investments and acquisition of material capital assets as at 31 December 2014.

Contingent liabilities

As at 31 December 2014, the Group provided guarantees to the extent of approximately HK$165,447,000 (2013: HK$346,715,000) to banks in respect of mortgage loans provided by the banks to customers for the purchase of the developed properties of the Group. These guarantees provided by the Group to the banks would be released upon receiving the building ownership certificates of the respective properties by the banks from the customers as a pledge for security to the mortgage loans granted.

The Group also shared contingent liabilities of a joint venture arising from guarantees provided by the joint venture to banks to the extent of approximately HK$36,272,000 (2013: HK$23,272,000) in respect of mortgage loans provided by the banks to customers for the purchase of the developed properties of the joint venture. These guarantees provided by the Group and the joint venture, to the banks would be released upon receiving the building ownership certificates of the respective properties by the banks from the customers as a pledge for security to the mortgage loans granted.

In the opinion of the directors, the fair value of guarantee contracts is insignificant at initial recognition.

– VIII-12 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

For the six months ended 30 June 2015

Review of operations

During the period under review, turnover of the Group amounted to approximately HK$1,157,206,000, representing an increase of 44% against approximately HK$803,696,000 for the same period in 2014. The turnover was mainly attributed to delivery of residential properties in Langfang, Shanghai Mandarin Palace, Xizhen and Haimen and delivery of residential properties in Qingdao Zendai Thumb Plaza. Such increase in turnover was mainly due to the increase in delivery of residential properties in Langfang in the period. Loss attributable to the Shareholders was approximately HK$513,033,000, an increase of 52% as compared with the same period of last year (loss for the same period of last year: HK$337,884,000). The substantial increase in loss of the Group in the period was mainly attributable to a decrease in gross profit due to the gross profit margin of recognized items in the current period being lower than the corresponding period in the previous year, a specific provision for diminution in value of properties under development in Haimen of approximately HK$66,111,000 and an increase in interest expense due to increased borrowing amount.

Liquidity, financial resources and gearing

As at 30 June 2015, the Group had a healthy financial position with net assets value of HK$5,704 million (31 December 2014: HK$6,277 million). Net current assets amounted to approximately HK$6,452 million (31 December 2014: approximately HK$7,595 million) with current ratio decreased from 1.97 times as at 31 December 2014 to approximately 1.62 times as at 30 June 2015. As at 30 June 2015, the Group had consolidated borrowings and loans payable of approximately HK$9,579 million in which HK$4,719 million was repayable within one year and HK$4,860 million was repayable within more than one year. Such bank loans were mainly denominated in HK$, RMB and US$. As at 30 June 2015, the Group’s bank balances and cash including pledged bank deposits were approximately HK$2,827 million, which were mainly denominated in HK$, RMB, US$ and ZAR. The gearing ratio of the Group increased from 1.38 times as at 31 December 2014 to 1.73 times as at 30 June 2015 (basis: total of amounts due to related companies, bank loans, notes payable and other borrowings divided by Shareholders’ funds).

Capital structure

The Group had no debt securities or other capital instruments as at 30 June 2015.

The Group adopted relatively prudent financial and treasury policies and closely monitored its cash flow. The Group’s overall strategy remains unchanged from prior corresponding period.

– VIII-13 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Segment information

Sales of properties

The turnover of this segment for the period amounted to HK$869,968,000 (2014: HK$535,224,000) which included delivery of residential properties in Langfang of approximately HK$550,000,000 (2014: nil), leading to the substantial increase in turnover for the period. The turnover for 2014 and 2015 were mainly generated from the delivery of its existing residential projects since land and property projects acquired in recent years were still in the planning or development stages, which were not ready to be launched to the market for sale during the period.

Property rental, management and agency services

The turnover of this segment for the period was approximately HK$194,352,000 (2014: HK$189,763,000) which remained stable.

Hotel operations

The turnover of this segment for the period was HK$90,730,000 (2014: HK$74,891,000), which increased by 21% mainly due to trial operation of Qingdao Himalayas hotel commenced in March 2014.

Travel and related business

The turnover of this segment for the period reached approximately HK$2,156,000 (2014: HK$3,818,000). This segment had been closed in July 2015.

Foreign currency exposures

The operations of the Group were mainly carried out in the PRC with most transactions settled in RMB. The Group undertook certain transactions denominated in currencies other than RMB, and hence exposures to exchange rate fluctuations arose. The Group’s cash and cash equivalents were also exposed to such foreign currency risk. The Group did not use any derivative contracts to hedge against its exposure to foreign currency risk. The Group managed its foreign currency risk by closely monitoring the movement of the foreign currency exchange rate.

Employees

As at 30 June 2015, the Group employed approximately 2,034 employees (2014: 2,106 employees) in Hong Kong, South Africa and the PRC. The Group determines their remuneration by reference to the nature of the job and market conditions. Other staff benefits include a mandatory provident fund scheme, local municipal government retirement scheme, insurance and medical insurance and share option scheme.

– VIII-14 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE GROUP

APPENDIX VIII

Major acquisition of assets

On 24 November 2014, the Group succeeded in a bid and signed the share transfer agreement for the purchase of the entire share capital of and the loan receivable from Nanjing Wudaokou Real Estate Co., Ltd.* (南京五道口置業有限公司) which owns a parcel of land located in Nanjing, Jiangsu Province, the PRC with a site area of approximately 26,318 sq. m. which is designated for commercial and office mixed use. The transaction was completed on 7 May 2015, and the purchase consideration is RMB1,043,210,000 (equivalent to approximately HK$1,304,010,000).

Charge on assets

As at 30 June 2015, the carrying amounts of following assets of the Group were pledged to secure the credit facilities granted to the Group, the carrying amount of the assets were analysed below:

Property, plant and equipment Payment for leasehold land held for own use under operating leases Investment properties Properties under development and for sales Pledged bank deposits	HK$’000 596,478 616,137 2,446,032 2,589,970 1,656,986
	7,905,603

Future plans for material investments and acquisition of capital assets

Save as disclosed above, the Group did not have any specific plan for material investments and acquisition of material capital assets as at 30 June 2015.

– VIII-15 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

MANAGEMENT DISCUSSION AND ANALYSIS ON THE TARGET COMPANIES

Target Company A

Set out below is the management discussion and analysis on Target Company A for the period commencing on the date of the establishment of Target Company A, i.e. 22 May 2014 up to 30 June 2015:

Turnover

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company A had no turnover.

Income tax expense

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no income tax expense for Target Company A as there were no assessable profit.

Profit/loss for the period

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company A did not record any profit or loss, since it has not yet commenced its operation since its establishment.

Capital structure and financial resources

As at 31 December 2014 and 30 June 2015, the paid-up capital of Target Company A were nil and RMB20.00 million respectively, which funded its operation.

As at 31 December 2014 and 30 June 2015, Target Company A did not have any outstanding bank borrowing and bank facilities.

For the period ended 31 December 2014 and the six months ended 30 June 2015, the capital requirement of Target Company A which is mainly for the payment of land premium of the Land Parcel A is financed by loans from its shareholder.

Charges on assets

As at 31 December 2014 and 30 June 2015, Target Company A did not pledge any assets.

Liquidity and gearing ratio

As at 31 December 2014 and 30 June 2015, the total borrowing of Target Company A (total of amounts due to related companies, bank and other loans, senior loan notes and other borrowing) were nil and approximately RMB237.46 million respectively and the gearing ratio (total borrowing divided by shareholders’ funds) were nil and approximately 11.87 times respectively.

– IX-1 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Material acquisitions and disposals of subsidiaries and affiliated companies

Target Company A had not made material acquisition and disposal of subsidiary and affiliated company for the period ended 31 December 2014 and the six months ended 30 June 2015.

Future plans for material investments

Target Company A is an investment holding company with business scope including property development and management, and it is intended to develop Land Parcel A into commercial properties for resale and/or rental purposes. Upon the completion of the Acquisition A, Target Company A will be financially supported by the Bidding Subsidiary or will seek bank loans in order to meet its financial obligation.

Significant investments held

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company A had not made any significant investment.

Contingent liabilities

As at 31 December 2014 and 30 June 2015, Target Company A had no contingent liabilities.

Exchange risk and hedging

As the operations of Target Company A were principally in the PRC and most of the transactions, assets and liabilities of Target Company A were denominated in RMB, the operations of Target Company A were not subject to significant exchange risk. Accordingly, no financial instruments for hedging purposes were used by Target Company A for the period ended 31 December 2014 and the six months ended 30 June 2015.

Staff and remuneration policies

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no staff cost or directors’ remuneration.

Segment information

Target Company A is an investment holding company with business scope including property development and management.

– IX-2 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Target Company B

Set out below is the management discussion and analysis on Target Company B for the period commencing on the date of the establishment of Target Company B, i.e. 13 February 2014 up to 30 June 2015:

Turnover

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company B had no turnover.

Income tax expense

The income tax expense of Target Company B amounted to RMB5,000.00 and nil for the period ended 31 December 2014 and six months ended 30 June 2015 respectively.

Profit/loss for the period

For the period ended 31 December 2014, the net profit before and after tax of Target Company B amounted to RMB20,000 and RMB15,000 respectively, which was attributable by the interest income as a result of an increase in bank balance due to the shareholder’s capital contribution to be used for the payment of the registered capital of Target Company B.

For the six months ended 30 June 2015, Target Company B did not record any profit or loss.

Capital structure and financial resources

As at 31 December 2014 and 30 June 2015, the paid-up capital of Target Company B were both approximately RMB20.00 million respectively, which funded its operation.

As at 31 December 2014 and 30 June 2015, Target Company B did not have any outstanding bank borrowing and bank facilities.

For the period ended 31 December 2014 and the six months ended 30 June 2015, the capital requirement of Target Company B which is mainly for the payment of land premium of the Land Parcel B is financed by loans from its shareholder.

Charges on assets

As at 31 December 2014 and 30 June 2015, Target Company B did not pledge any assets.

Liquidity and gearing ratio

As at 31 December 2014 and 30 June 2015, the total borrowing of Target Company B (total of amounts due to related companies, bank and other loans, senior loan notes and other borrowing) were both approximately RMB432.80 million and the gearing ratio (total borrowing divided by shareholders’ funds) were both approximately 21.62 times respectively.

– IX-3 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Material acquisitions and disposals of subsidiaries and affiliated companies

Target Company B had not made material acquisition and disposal of subsidiary and affiliated company for the period ended 31 December 2014 and the six months ended 30 June 2015.

Future plans for material investments

Target Company B is an investment holding company with business scope including property development and management, and it is intended to develop Land Parcel B into commercial properties for resale and/or rental purposes. Upon the completion of the Acquisition B, Target Company B will be financially supported by the Bidding Subsidiary or will seek bank loans in order to meet its financial obligation.

Significant investments held

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company B had not made any significant investment.

Contingent liabilities

As at 31 December 2014 and 30 June 2015, Target Company B had no contingent liabilities.

Exchange risk and hedging

As the operations of Target Company B were principally in the PRC and most of the transactions, assets and liabilities of Target Company B were denominated in RMB, the operations of Target Company B were not subject to significant exchange risk. Accordingly, no financial instruments for hedging purposes were used by Target Company B for the period ended 31 December 2014 and the six months ended 30 June 2015.

Staff and remuneration policies

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no staff cost or directors’ remuneration.

Segment information

Target Company B is an investment holding company with business scope including property development and management.

– IX-4 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Target Company C

Set out below is the management discussion and analysis on Target Company C for the period commencing on the date of the establishment of Target Company C, i.e. 22 May 2014 up to 30 June 2015:

Turnover

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company C had no turnover.

Income tax expense

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no income tax expense for Target Company C as there were no assessable profit.

Profit/loss for the period

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company C did not record any profit or loss, since it has not yet commenced its operation since its establishment.

Capital structure and financial resources

As at 31 December 2014 and 30 June 2015, the paid-up capital of Target Company C were nil and RMB20.00 million respectively, which funded its operation.

As at 31 December 2014 and 30 June 2015, Target Company C did not have any outstanding bank borrowing and bank facilities.

For the period ended 31 December 2014 and the six months ended 30 June 2015, the capital requirement of Target Company C which is mainly for the payment of land premium of the Land Parcel C is financed by loans from its shareholder.

Charges on assets

As at 31 December 2014 and 30 June 2015, Target Company C did not pledge any assets.

Liquidity and gearing ratio

As at 31 December 2014 and 30 June 2015, the total borrowing of Target Company C (total of amounts due to related companies, bank and other loans, senior loan notes and other borrowing) were approximately nil and RMB133.24 million respectively and the gearing ratio (total borrowing divided by shareholders’ funds) were nil and approximately 6.66 times respectively.

– IX-5 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Material acquisitions and disposals of subsidiaries and affiliated companies

Target Company C had not made material acquisition and disposal of subsidiary and affiliated company for the period ended 31 December 2014 and the six months ended 30 June 2015.

Future plans for material investments

Target Company C is an investment holding company with business scope including property development and management, and it is intended to develop Land Parcel C into commercial properties for resale and/or rental purposes. Upon the completion of the Acquisition C, Target Company C will be financially supported by the Bidding Subsidiary or will seek bank loans in order to meet its financial obligation.

Significant investments held

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company C had not made any significant investment.

Contingent liabilities

As at 31 December 2014 and 30 June 2015, Target Company C had no contingent liabilities.

Exchange risk and hedging

As the operations of Target Company C were principally in the PRC and most of the transactions, assets and liabilities of Target Company C were denominated in RMB, the operations of Target Company C were not subject to significant exchange risk. Accordingly, no financial instruments for hedging purposes were used by Target Company C for the period ended 31 December 2014 and the six months ended 30 June 2015.

Staff and remuneration policies

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no staff cost or directors’ remuneration.

Segment information

Target Company C is an investment holding company with business scope including property development and management.

– IX-6 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Target Company D

Set out below is the management discussion and analysis on Target Company D for the period commencing on the date of the establishment of Target Company D, i.e. 22 May 2014 up to 30 June 2015:

Turnover

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company D had no turnover.

Income tax expense

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no income tax expense for Target Company D as there were no assessable profit.

Profit/loss for the period

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company D did not record any profit or loss, since it has not yet commenced its operation since its establishment.

Capital structure and financial resources

For the period ended 31 December 2014 and the six months ended 30 June 2015, the paid-up capital of Target Company D were nil and RMB20.00 million respectively, which funded its operation.

As at 31 December 2014 and 30 June 2015, Target Company D did not have any outstanding bank borrowing and bank facilities.

For the period ended 31 December 2014 and the six months ended 30 June 2015, the capital requirement of Target Company D which is mainly for the payment of land premium of the Land Parcel D is financed by loans from its shareholder.

Charges on assets

As at 31 December 2014 and 30 June 2015, Target Company D did not pledge any assets.

Liquidity and gearing ratio

As at 31 December 2014 and 30 June 2015, the total borrowing of Target Company D (total of amounts due to related companies, bank and other loans, senior loan notes and other borrowing) were nil and approximately RMB530.01 million respectively and the gearing ratio (total borrowing divided by shareholders’ funds) were nil and approximately 26.50 times respectively.

– IX-7 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Material acquisitions and disposals of subsidiaries and affiliated companies

Target Company D had not made material acquisition and disposal of subsidiary and affiliated company for the period ended 31 December 2014 and the six months ended 30 June 2015.

Future plans for material investments

Target Company D is an investment holding company with business scope including property development and management, and it is intended to develop Land Parcel D into commercial properties for resale and/or rental purposes. Upon the completion of the Acquisition D, Target Company D will be financially supported by the Bidding Subsidiary or will seek bank loans in order to meet its financial obligation.

Significant investments held

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company D had not made any significant investment.

Contingent liabilities

As at 31 December 2014 and 30 June 2015, Target Company D had no contingent liabilities.

Exchange risk and hedging

As the operations of Target Company D were principally in the PRC and most of the transactions, assets and liabilities of Target Company D were denominated in RMB, the operations of Target Company D were not subject to significant exchange risk. Accordingly, no financial instruments for hedging purposes were used by Target Company D for the period ended 31 December 2014 and the six months ended 30 June 2015.

Staff and remuneration policies

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no staff cost or directors’ remuneration.

Segment information

Target Company D is an investment holding company with business scope including property development and management.

– IX-8 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Target Company E

Set out below is the management discussion and analysis on Target Company E for the period commencing on the date of the establishment of Target Company E, i.e. 22 May 2014 up to 30 June 2015:

Turnover

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company E had no turnover.

Income tax expense

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no income tax expense for Target Company E as there was no assessable profit.

Profit/loss for the period

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company E did not record any profit or loss, since it has not yet commenced its operation since its establishment.

Capital structure and financial resources

As at 31 December 2014 and 30 June 2015, the paid-up capital of Target Company E were nil and RMB20.00 million respectively, which funded its operation.

As at 31 December 2014 and 30 June 2015, Target Company E did not have any outstanding bank borrowing and bank facilities.

For the period ended 31 December 2014 and the six months ended 30 June 2015, the capital requirement of Target Company E which is mainly for the payment of land premium of the Land Parcel E is financed by loans from its shareholder.

Charges on assets

As at 31 December 2014 and 30 June 2015, Target Company E did not pledge any assets.

Liquidity and gearing ratio

As at 31 December 2014 and 30 June 2015, the total borrowing of Target Company E (total of amounts due to related companies, bank and other loans, senior loan notes and other borrowing) were nil and approximately RMB348.31 million respectively and the gearing ratio (total borrowing divided by shareholders’ funds) were nil and approximately 17.42 times respectively.

– IX-9 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Material acquisitions and disposals of subsidiaries and affiliated companies

Target Company E had not made material acquisition and disposal of subsidiary and affiliated company for the period ended 31 December 2014 and the six months ended 30 June 2015.

Future plans for material investments

Target Company E is an investment holding company with business scope including property development and management, and it is intended to develop Land Parcel E into commercial properties for resale and/or rental purposes. Upon the completion of the Acquisition E, Target Company E will be financially supported by the Bidding Subsidiary or will seek bank loans in order to meet its financial obligation.

Significant investments held

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company E had not made any significant investment.

Contingent liabilities

As at 31 December 2014 and 30 June 2015, Target Company E had no contingent liabilities.

Exchange risk and hedging

As the operations of Target Company E were principally in the PRC and most of the transactions, assets and liabilities of Target Company E were denominated in RMB, the operations of Target Company E were not subject to significant exchange risk. Accordingly, no financial instruments for hedging purposes were used by Target Company E for the period ended 31 December 2014 and the six months ended 30 June 2015.

Staff and remuneration policies

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no staff cost or directors’ remuneration.

Segment information

Target Company E is an investment holding company with business scope including property development and management.

– IX-10 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Target Company F

Set out below is the management discussion and analysis on Target Company F for the period commencing on the date of the establishment of Target Company F, i.e. 13 February 2014 up to 30 June 2015:

Turnover

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company F had no turnover.

Income tax expense

For the period ended 31 December 2014 and the six months ended 30 June 2015, the income tax expense of Target Company F amounted to RMB5,000.00 and nil respectively.

Profit/loss for the period

For the period ended 31 December 2014, the net profit before and after tax of Target Company F amounted to RMB19,000 and RMB14,000 respectively, which was attributable by the interest income as a result of an increase in bank balance due to the shareholder’s capital contribution to be used for the payment of the registered capital of Target Company F.

For the six months ended 30 June 2015, Target Company F did not record any profit or loss.

Capital structure and financial resources

For the period ended 31 December 2014 and the six months ended 30 June 2015, the paid-up capital of Target Company F were both approximately RMB20.00 million respectively, which funded its operation.

As at 31 December 2014 and 30 June 2015, Target Company F did not have any outstanding bank borrowing and bank facilities.

For the period ended 31 December 2014 and the six months ended 30 June 2015, the capital requirement of Target Company F which is mainly for the payment of land premium of the Land Parcel F is financed by loans from its shareholder.

Charges on assets

As at 31 December 2014 and 30 June 2015, Target Company F did not pledge any assets.

Liquidity and gearing ratio

As at 31 December 2014 and 30 June 2015, the total borrowing of Target Company F (total of amounts due to related companies, bank and other loans, senior loan notes and other borrowing) were both approximately RMB613.97 million respectively and the gearing ratio (total borrowing divided by shareholders’ funds) were both approximately 30.68 times respectively.

– IX-11 –

MANAGEMENT DISCUSSION AND ANALYSIS OF THE TARGET COMPANIES

APPENDIX IX

Material acquisitions and disposals of subsidiaries and affiliated companies

Target Company F had not made material acquisition and disposal of subsidiary and affiliated company for the period ended 31 December 2014 and the six months ended 30 June 2015.

Future plans for material investments

Target Company F is an investment holding company with business scope including property development and management, and it is intended to develop Land Parcel F into commercial properties for resale and/or rental purposes. Upon the completion of the Acquisition F, Target Company F will be financially supported by the Bidding Subsidiary or will seek bank loans in order to meet its financial obligation.

Significant investments held

For the period ended 31 December 2014 and the six months ended 30 June 2015, Target Company F had not made any significant investment.

Contingent liabilities

As at 31 December 2014 and 30 June 2015, Target Company F had no contingent liabilities.

Exchange risk and hedging

As the operations of Target Company F were principally in the PRC and most of the transactions, assets and liabilities of Target Company F were denominated in RMB, the operations of Target Company F were not subject to significant exchange risk. Accordingly, no financial instruments for hedging purposes were used by Target Company F for the period ended 31 December 2014 and the six months ended 30 June 2015.

Staff and remuneration policies

For the period ended 31 December 2014 and the six months ended 30 June 2015, there were no staff cost or directors’ remuneration.

Segment information

Target Company F is an investment holding company with business scope including property development and management.

– IX-12 –

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

APPENDIX X

A. UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

Introduction

The following is an illustrative and unaudited pro forma financial information of the Enlarged Group comprising the unaudited pro forma consolidated statement of financial position, the unaudited pro forma consolidated statement of comprehensive income and the unaudited pro forma consolidated cash flow statement of the Enlarged Group (“Unaudited Pro Forma Financial Information”), which have been prepared on the basis of the notes set out below for the purpose of illustrating the effect of the transaction, as if the transactions under the Equity Transfer Agreements (the “Transaction”) had been completed on 30 June 2015 for the unaudited pro forma consolidated statement of financial position and as if it had taken place on 1 January 2015 for the unaudited pro forma consolidated statement of comprehensive income and the unaudited pro forma consolidated cash flow statement.

The Unaudited Pro Forma Financial Information has been prepared by the directors of the Company for illustrative purposes only and because of its hypothetical nature, it may not give a true picture of the financial position, results of operations and cash flows of the Group had the Acquisition been completed as at 30 June 2015 or 1 January 2015, where applicable, or any future dates.

The Unaudited Pro Forma Financial Information has been prepared using the accounting policies consistent with those of the Group as set out in the published annual report of the Group for the year ended 31 December 2014.

The Unaudited Pro Forma Financial Information should be read in conjunction with other financial information contained in this circular.

– X-1 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

	Pro forma	consolidated	statements of	comprehensive	income of the	Enlarged Group	for the	six months	ended 30 June	2015	HK$’000		1,157,206	(1,078,439)	78,767	27,655		(56,231)	(209,881)		1,265	(58,825)		(81,691)	(207,988)	(506,929)	(50,743)	(557,672)
									Other	adjustment	HK$’000		–	–	–	–		–	–		–	–		–	–	–	–	–
	Audited	statements of	comprehensive	income of	Target	Company F	for the	six months	ended 30 June	2015	HK$’000	(Note 2)	–	–	–	–		–	–		–	–		–	–	–	–	–
Pro forma adjustments of transaction	Audited Audited Audited	statements of statements of statements of	comprehensive comprehensive comprehensive	income of income of income of	Target Target Target	Company C Company D Company E	for the for the for the	six months six months six months	ended 30 June ended 30 June ended 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2) (Note 2) (Note 2)	– – –	– – –	– – –	– – –		– – –	– – –		– – –	– – –		– – –	– – –	– – –	– – –	– – –
	Audited	statements of	comprehensive	income of	Target	Company B	for the	six months	ended 30 June	2015	HK$’000	(Note 2)	–	–	–	–		–	–		–	–		–	–	–	–	–
	Audited	statements of	comprehensive	income of	Target	Company A	for the	six months	ended 30 June	2015	HK$’000	(Note 2)	–	–	–	–		–	–		–	–		–	–	–	–	–
	Unaudited	consolidated	statements of	comprehensive	income of	the Group	for the	six months	ended 30 June	2015	HK$’000	(Note 1)	1,157,206	(1,078,439)	78,767	27,655		(56,231)	(209,881)		1,265	(58,825)		(81,691)	(207,988)	(506,929)	(50,743)	(557,672)
													Turnover	Cost of sales	Gross profit	Other income and gains	Selling and marketing	expenses	Administrative expenses	Change in fair value of	investment properties	Share of results of associates	Share of results of joint	ventures	Finance costs	Loss before income tax	Income tax expense	Loss for the period

– X-2 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

Pro forma	consolidated	statements of	comprehensive	income of the	Enlarged Group	for the	six months	ended 30 June	2015	HK$’000		(557,672)		(513,033)	(44,639)	(557,672)							(13,241)				(3,120)		780
								Other	adjustment	HK$’000		–		–	–	–							–				–		–
Audited	statements of	comprehensive	income of	Target	Company F	for the	six months	ended 30 June	2015	HK$’000	(Note 2)	–		–	–	–							–				–		–
Audited Audited Audited	statements of statements of statements of	comprehensive comprehensive comprehensive	income of income of income of	Target Target Target	Company C Company D Company E	for the for the for the	six months six months six months	ended 30 June ended 30 June ended 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2) (Note 2) (Note 2)	– – –		– – –	– – –	– – –							– – –				– – –		– – –
Audited	statements of	comprehensive	income of	Target	Company B	for the	six months	ended 30 June	2015	HK$’000	(Note 2)	–		–	–	–							–				–		–
Audited	statements of	comprehensive	income of	Target	Company A	for the	six months	ended 30 June	2015	HK$’000	(Note 2)	–		–	–	–							–				–		–
Unaudited	consolidated	statements of	comprehensive	income of	the Group	for the	six months	ended 30 June	2015	HK$’000	(Note 1)	(557,672)		(513,033)	(44,639)	(557,672)							(13,241)				(3,120)		780
												Loss for the period	Loss attributable to:	– Owners of the Company	– Non-controlling interests		Other comprehensive loss	Items that may be	reclassified to profit	or loss:	Exchange differences arising	on translation of foreign	operations	Release of other revaluation	reserve on disposal of	properties for sales held by	associates	Tax expense related to release	of other revaluation reserve

– X-3 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

Pro forma	consolidated	statements of	comprehensive	income of the	Enlarged Group	for the	six months	ended 30 June	2015	HK$’000			(15,581)		(573,253)			(528,568)	(44,685)	(573,253)
								Other	adjustment	HK$’000			–		–			–	–	–
Audited	statements of	comprehensive	income of	Target	Company F	for the	six months	ended 30 June	2015	HK$’000	(Note 2)		–		–			–	–	–
Audited Audited Audited	statements of statements of statements of	comprehensive comprehensive comprehensive	income of income of income of	Target Target Target	Company C Company D Company E	for the for the for the	six months six months six months	ended 30 June ended 30 June ended 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2) (Note 2) (Note 2)		– – –		– – –			– – –	– – –	– – –
Audited	statements of	comprehensive	income of	Target	Company B	for the	six months	ended 30 June	2015	HK$’000	(Note 2)		–		–			–	–	–
Audited	statements of	comprehensive	income of	Target	Company A	for the	six months	ended 30 June	2015	HK$’000	(Note 2)		–		–			–	–	–
Unaudited	consolidated	statements of	comprehensive	income of	the Group	for the	six months	ended 30 June	2015	HK$’000	(Note 1)		(15,581)		(573,253)			(528,568)	(44,685)	(573,253)
												Other comprehensive loss for	the period, net of tax	Total comprehensive loss for	the period	Total comprehensive loss for	the period attributable to:	– Owners of the Company	– Non-controlling interests

– X-4 –

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

APPENDIX X

	Unaudited	Pro forma	statement of	financial	position of the	Enlarged Group	as at 30 June	2015	HK$’000					674,038	2,882,486			616,137	37,483	123,909	1,303,385	9,191		67,480	5,714,109
							Other	adjustment	HK$’000					–	–			–	–	–	–	–		–	–
	Audited	statement of	financial	position of	Target	Company F as	at 30 June	2015	HK$’000	(Note 2)				–	–			–	–	–	–	–		–	–
Pro forma adjustments of transaction	Audited Audited Audited	statement of statement of statement of	financial financial financial	position of position of position of	Target Target Target	Company C as Company D as Company E as	at 30 June at 30 June at 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2) (Note 2) (Note 2)				– – –	– – –			– – –	– – –	– – –	– – –	– – –		– – –	– – –
	Audited	statement of	financial	position of	Target	Company B as	at 30 June	2015	HK$’000	(Note 2)				–	–			–	–	–	–	–		–	–
	Audited	statement of	financial	position of	Target	Company A as	at 30 June	2015	HK$’000	(Note 2)				–	–			–	–	–	–	–		–	–
	Unaudited	consolidated	statement of	financial	position of	the Group as	at 30 June	2015	HK$’000	(Note 1)				674,038	2,882,486			616,137	37,483	123,909	1,303,385	9,191		67,480	5,714,109
											ASSETS	Non-current assets	Property, plant and	equipment	Investment properties	Payment for leasehold land	held for own use under	operating leases	Goodwill	Interests in an associate	Interests in joint ventures	Deferred income tax assets	Available-for-sale financial	assets	Total non-current assets

– X-5 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

	Unaudited	Pro forma	statement of	financial	position of the	Enlarged Group	as at 30 June	2015	HK$’000					14,361,893	4,113	670,202			62,436	1,120,016		1,878,637		31,875	1,656,986	119,976	126,486	1,165,151	21,197,771		1,307,476	22,505,247	28,219,356
							Other	adjustment	HK$’000	(Note 4, 5)				2,653,487	–	–			(63,245)	–		–		–	–	–	–	(5,164)	2,585,078		–	2,585,078	2,585,078
	Audited	statement of	financial	position of	Target	Company F as	at 30 June	2015	HK$’000	(Note 2, 3)				801,908	–	–			–	–		–		–	–	–	–	22	801,930		–	801,930	801,930
Pro forma adjustments of transaction	Audited Audited Audited	statement of statement of statement of	financial financial financial	position of position of position of	Target Target Target	Company C as Company D as Company E as	at 30 June at 30 June at 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2, 3) (Note 2, 3) (Note 2, 3)				193,833 695,708 465,875	– – –	– – –			– – –	– – –		– – –		– – –	– – –	– – –	– – –	– – –	193,833 695,708 465,875		– – –	193,833 695,708 465,875	193,833 695,708 465,875
	Audited	statement of	financial	position of	Target	Company B as	at 30 June	2015	HK$’000	(Note 2, 3)				572,747	–	–			–	–		–		–	–	–	–	23	572,770		–	572,770	572,770
	Audited	statement of	financial	position of	Target	Company A as	at 30 June	2015	HK$’000	(Note 2, 3)				325,661	–	–			–	–		–		–	–	–	–	–	325,661		–	325,661	325,661
	Unaudited	consolidated	statement of	financial	position of	the Group as	at 30 June	2015	HK$’000	(Note 1)				8,652,674	4,113	670,202			125,681	1,120,016		1,878,637		31,875	1,656,986	119,976	126,486	1,170,270	15,556,916		1,307,476	16,864,392	22,578,501
											Current assets	Properties under development	and completed properties	held-for-sale	Inventories	Trade and other receivables	Deposits for property under	development and land use	rights	Amounts due from an associate	Amounts due from joint	ventures	Amounts due from minority	owners of subsidiaries	Pledged bank deposits	Tax prepayments	Entrusted loan receivables	Cash and cash equivalents		Assets of disposal group	classified as held-for-sale	Total current assets	Total assets

– X-6 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

	Unaudited	Pro forma	statement of	financial	position of the	Enlarged Group	as at 30 June	2015	HK$’000					297,587	3,250,160	1,840,393	5,388,140	315,549	5,703,689			6,504,092		568,308	155,822		878,405	8,106,627
							Other	adjustment	HK$’000	(Note 5, 8)				(151,788)	(4)	(32)	(151,824)	–	(151,824)			1,644,370		–	–		–	1,644,370
	Audited	statement of	financial	position of	Target	Company F as	at 30 June	2015	HK$’000	(Note 2, 3)				25,298	1	16	25,315	–	25,315			–		–	–		–	–
Pro forma adjustments of transaction	Audited Audited Audited	statement of statement of statement of	financial financial financial	position of position of position of	Target Target Target	Company C as Company D as Company E as	at 30 June at 30 June at 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2, 3) (Note 2, 3) (Note 2, 3)				25,298 25,298 25,298	– – –	– – –	25,298 25,298 25,298	– – –	25,298 25,298 25,298			– – –		– – –	– – –		– – –	– – –
	Audited	statement of	financial	position of	Target	Company B as	at 30 June	2015	HK$’000	(Note 2, 3)				25,298	3	16	25,317	–	25,317			–		–	–		–	–
	Audited	statement of	financial	position of	Target	Company A as	at 30 June	2015	HK$’000	(Note 2, 3)				25,298	–	–	25,298	–	25,298			–		–	–		–	–
	Unaudited	consolidated	statement of	financial	position of	the Group as	at 30 June	2015	HK$’000	(Note 1)				297,587	3,250,160	1,840,393	5,388,140	315,549	5,703,689			4,859,722		568,308	155,822		878,405	6,462,257
											EQUITY	Equity attributable to	owners of the Company	Share capital	Other reserves	Retained earnings		Non-controlling interests	Total equity	LIABILITIES	Non-current liabilities	Borrowings and loans	Deferred income tax	liabilities	Other payables	Amount due to minority	owners of subsidiaries	Total non-current liabilities

– X-7 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

	Unaudited	Pro forma	statement of	financial	position of the	Enlarged Group	as at 30 June	2015	HK$’000			5,183,188		942,612		1,754,098		146,823	470,727	4,719,343	13,216,791		1,192,249	14,409,040	22,515,667	28,219,356
							Other	adjustment	HK$’000	(Note 6)		1,092,532		–		–		–	–	–	1,092,532		–	1,092,532	2,736,902	2,585,078
	Audited	statement of	financial	position of	Target	Company F as	at 30 June	2015	HK$’000	(Note 2, 3)		776,611		–		–		–	4	–	776,615		–	776,615	776,615	801,930
Pro forma adjustments of transaction	Audited Audited Audited	statement of statement of statement of	financial financial financial	position of position of position of	Target Target Target	Company C as Company D as Company E as	at 30 June at 30 June at 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2, 3) (Note 2, 3) (Note 2, 3)		168,535 670,410 440,577		– – –		– – –		– – –	– – –	– – –	168,535 670,410 440,577		– – –	168,535 670,410 440,577	168,535 670,410 440,577	193,833 695,708 465,875
	Audited	statement of	financial	position of	Target	Company B as	at 30 June	2015	HK$’000	(Note 2, 3)		547,449		–		–		–	4	–	547,453		–	547,453	547,453	572,770
	Audited	statement of	financial	position of	Target	Company A as	at 30 June	2015	HK$’000	(Note 2, 3)		300,363		–		–		–	–	–	300,363		–	300,363	300,363	325,661
	Unaudited	consolidated	statement of	financial	position of	the Group as	at 30 June	2015	HK$’000	(Note 1)		1,186,711		942,612		1,754,098		146,823	470,719	4,719,343	9,220,306		1,192,249	10,412,555	16,874,812	22,578,501
											Current liabilities	Trade and other payables	Receipts in advance from	customers	Amounts due to joint	ventures	Amounts due to minority	owners of subsidiaries	Tax payables	Borrowings and loans		Liabilities of disposal group	classified as held-for-sale	Total current liabilities	Total liabilities	Total equity and liabilities

– X-8 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

	Unaudited	Pro forma	cash flow	statement of the	Enlarged Group	for the	six months	ended 30 June	2015	HK$’000				(2,035,552)	(35,317)		(2,070,869)				176,068		(623,837)		20,085		(881,561)		357		28,250		(1,280,638)
								Other	adjustment	HK$’000	(Note 5)			(1,649,534)	–		(1,649,534)				–		–		–		–		–		–		–
		Audited cash	flow statement	of Target	Company F	for the	six months	ended 30 June	2015	HK$’000	(Note 2, 3)			–	–		–				–		–		–		–		–		–		–
Pro forma adjustments of transaction		Audited cash Audited cash Audited cash	flow statement flow statement flow statement	of Target of Target of Target	Company C Company D Company E	for the for the for the	six months six months six months	ended 30 June ended 30 June ended 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2, 3, 7) (Note 2, 3, 7) (Note 2, 3, 7)			(25,266) (25,266) (25,266)	– – –		(25,266) (25,266) (25,266)				– – –		– – –		– – –		– – –		– – –		– – –		– – –
		Audited cash	flow statement	of Target	Company B	for the	six months	ended 30 June	2015	HK$’000	(Note 2, 3)			–	–		–				–		–		–		–		–		–		–
		Audited cash	flow statement	of Target	Company A	for the	six months	ended 30 June	2015	HK$’000	(Note 2, 3, 7)			(25,266)	–		(25,266)				–		–		–		–		–		–		–
	Unaudited	consolidated	cash flow	statement of	the Group	for the	six months	ended 30 June	2015	HK$’000	(Note 1)			(284,954)	(35,317)		(320,271)				176,068		(623,837)		20,085		(881,561)		357		28,250		(1,280,638)
												Cash flows from operating	activities	Net cash used in operations	Income tax paid	Cash flows from operating	activities-net	Cash flows from investing	activities	Decrease/(increase) in amounts	due from associates	Increase in amounts due from	joint ventures	Decrease in amounts due from	joint ventures	Increase in pledged bank	deposits – net	Net proceeds on disposal of a	subsidiary	Other investing cash flows	– net	Cash flows from investing	activities – net

– X-9 –

APPENDIX X

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

Unaudited	Pro forma	cash flow	statement of the	Enlarged Group	for the	six months	ended 30 June	2015	HK$’000					824,321			(1,039,742)	5,841,844	(2,074,310)		66,418		3,618,531		267,024		1,098,118		4,851		(204,842)		1,165,151
							Other	adjustment	HK$’000	(Note 5)				–			–	1,644,370	–		–		1,644,370		(5,164)		–		–		–		(5,164)
	Audited cash	flow statement	of Target	Company F	for the	six months	ended 30 June	2015	HK$’000	(Note 2, 3)				–			–	–	–		–		–		–		21		1		–		22
	Audited cash Audited cash Audited cash	flow statement flow statement flow statement	of Target of Target of Target	Company C Company D Company E	for the for the for the	six months six months six months	ended 30 June ended 30 June ended 30 June	2015 2015 2015	HK$’000 HK$’000 HK$’000	(Note 2, 3, 7) (Note 2, 3, 7) (Note 2, 3, 7)				– – –			– – –	– – –	– – –		25,266 25,266 25,266		25,266 25,266 25,266		– – –		– – –		– – –		– – –		– – –
	Audited cash	flow statement	of Target	Company B	for the	six months	ended 30 June	2015	HK$’000	(Note 2, 3)				–			–	–	–		–		–		–		23		–		–		23
	Audited cash	flow statement	of Target	Company A	for the	six months	ended 30 June	2015	HK$’000	(Note 2, 3, 7)				–			–	–	–		25,266		25,266		–		–		–		–		–
Unaudited	consolidated	cash flow	statement of	the Group	for the	six months	ended 30 June	2015	HK$’000	(Note 1)				824,321			(1,039,742)	4,197,474	(2,074,310)		(34,646)		1,873,097		272,188		1,098,074		4,850		(204,842)		1,170,270
											Cash flows from financing	activities	Increase in amount due to a	joint venture	(Decrease)/increase in amounts	due to minority owners of	subsidiaries	Increase in borrowings	Repayment of borrowings	Other financing cash flows	– net	Cash flows from financing	activities – net	Net increase in cash and cash	equivalents	Cash and cash equivalents at	the beginning of the period	Effect of foreign exchange rate	changes	Cash of disposal group	classified as held-for-sale	Cash and cash equivalents at	the end of the period

– X-10 –

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

APPENDIX X

NOTES TO THE UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

The unaudited consolidated statement of financial position of the Group as at 30 June 2015, the unaudited consolidated statement of comprehensive income and the unaudited consolidated cash flow statement of the Group for the period ended 30 June 2015 are extracted from the published interim report of the Company for the six months ended 30 June 2015.
The audited statement of financial position of the Target Companies as at 30 June 2015, the audited income statement, the audited comprehensive income statement and the audited cash flow statement of the Target Companies for the period ended 30 June 2015 are extracted from the Accountant’s Reports as set out in Appendix II to Appendix VII in this circular, respectively.
For the purpose of preparing the unaudited pro forma consolidated statement of financial position of the Enlarged Group, the translation of RMB to HK$ was made at a rate of RMB1 to HK$1.2649. For the purpose of preparing the consolidated statement of comprehensive income and the unaudited pro forma consolidated cash flow statement of the Enlarged Group, the translation of RMB to HK$ was made at a rate of RMB1 to HK$1.2633.
Under HKFRSs, the Transaction was accounted for as an acquisition of assets and liabilities as the Target Companies proposed to be acquired by the Group does not constitute a business. The land use rights acquired are initially recognised at cost and subsequently at the lower of cost and net realisable value. Assuming that the Transaction is completed on 30 June 2015, an analysis of the additional cost being allocated to the assets and liabilities of the Target Companies as at 30 June 2015 after the pro forma adjustment as disclosed in this circular are as follows:

Land use rights Cash	The Target Companies HK$’000 Note 2 3,055,732 45 3,055,777	Pro forma adjustment HK$’000 2,653,487 – 2,653,487	Carrying Values of Assets and liabilities HK$’000 5,709,219 45
			5,709,264

The adjustment to deposits for property under development and land use rights of HK$63,245,000 and cash and cash equivalents of HK$1,649,534,000 represents the first instalment of 30% of the total consideration amounting to RMB1,354,083,000 (equivalent to approximately HK$1,712,779,000 which shall be paid within five business days upon the Equity Transfer Agreements becoming effective. It is the current intention of the Group to finance the first instalment of the consideration by the drawdown of RMB1,300,000,000 (equivalent to approximately HK$1,644,370,000) loan from the existing banking facilities. The net adjustment to cash and cash equivalent is HK$5,164,000.
The adjustment to trade and other payable, amounting to HK$1,092,532,000 represents the amounts due to Nanjing Linjiang Old Town Renovation Construction and Investment Co., Ltd (“Linjiang Old Town”) to be paid by the Group within one year upon the Equity Transfer Agreements becoming effective and subject to the obtaining of the delivery confirmation and land title certificates of the land parcels. It is calculated based on the remaining 70% of the consideration of the Equity Transfer Agreements amounting to RMB3,159,527,000 (equivalent to approximately HK$3,996,485,000 minus tax payable and the amounts due to Linjiang Old Town by Target Companies, which is HK$2,903,953,000 in total.
Cash used in operations mainly represents cash outflow of payment of amount due to Linjiang Old Town relating to the purchase of land use rights. Other financing cash flows-net of the Target Companies represent the cash inflow of capital contribution from Linjiang Old Town for the six months ended 30 June 2015.
The adjustment to equity represents the elimination of the paid-in capital and pre-acquisition of reserves of the Target Companies.
None of the pro forma adjustments to unaudited pro forma consolidated statement of comprehensive income and the consolidated cash flow statement is expected to have a continuing effect.
No other adjustments have been made to reflect any trading results or other transactions of the Group and of the Target Companies subsequent to 30 June 2015.

– X-11 –

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

APPENDIX X

The following is the text of a report received from PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, for the purpose of incorporation in this circular.

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

TO THE DIRECTORS OF SHANGHAI ZENDAI PROPERTY LIMITED

We have completed our assurance engagement to report on the compilation of unaudited pro forma financial information of Shanghai Zendai Property Limited (the “Company”) and its subsidiaries (collectively the “Group”), and Nanjing Himalayas Real Estate Company Limited (南京喜瑪拉雅置業有限公司) (“Target Company A”), Nanjing Zendai Kuanyu Real Estate Company Limited (南京証大寬域置業有限公司) (“Target Company B”), Nanjing Thumb Development Company Limited (南京大拇指商業發展有限公司) (“Target Company C”), Nanjing Shuiqingmuhua Real Estate Company Limited (南京水清木華置業有限公司) (“Target Company D”), Nanjing Radisson Real Estate Company Limited (南京麗笙置業有限公司) (“Target Company E”) and Nanjing Zendai Delta Real Estate Company Limited (南京証大三角洲置業有限公司) (“Target Company F”, together with Target Company A, Target Company B, Target Company C, Target Company D and Target Company E, the “Target Companies”), (collectively the “Enlarged Group”) by the directors for illustrative purposes only. The unaudited pro forma financial information consists of the unaudited pro forma consolidated statement of financial position as at 30 June 2015, the unaudited pro forma consolidated statement of comprehensive income for the period ended 30 June 2015, the pro forma consolidated cash flow statement for the period ended 30 June 2015, and related notes (the “Unaudited Pro Forma Financial Information”) as set out on pages X-1 to X-11 of the Company’s circular dated 24 September 2015, in connection with the proposed acquisition of the Target Companies (the “Transaction”) by the Company. The applicable criteria on the basis of which the directors have compiled the Unaudited Pro Forma Financial Information are described on page X-11.

The Unaudited Pro Forma Financial Information has been compiled by the directors to illustrate the impact of the Transaction on the Group’s financial position as at 30 June 2015 and the Group’s financial performance and cash flows for the period ended 30 June 2015 as if the Transaction had taken place at 30 June 2015 and 1 January 2015, respectively. As part of this process, information about the Group’s financial position, financial performance and cash flows has been extracted by the directors from the Group’s financial statements for the period ended 30 June 2015, on which a review report has been published.

Directors’ Responsibility 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 (“HKICPA”).

– X-12 –

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

APPENDIX X

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 complies with ethical requirements and 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 a circular is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the entity 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 Transaction at 30 June 2015 or 1 January 2015 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.

– X-13 –

PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP

APPENDIX X

The procedures selected depend on the reporting accountant’s judgment, having regard to the reporting accountant’s understanding of the nature of the company, 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.

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 by the directors of the Company 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.

PricewaterhouseCoopers

Certified Public Accountants

Hong Kong, 24 September 2015

– X-14 –

PROPERTY VALUATION REPORT

APPENDIX XI

The following is the text of a letter summary of valuations and valuation certificates prepared for the purpose of incorporation in this circular received from DTZ Debenham Tie Leung Limited, an independent property valuer, in connection with its opinion of market values of the Properties held by the Target Companies in the PRC as at 30 June 2015.

==> picture [51 x 39] intentionally omitted <==

16/F, Jardine House 1 Connaught Place Central Hong Kong

24 September 2015

The Directors Shanghai Zendai Property Limited Unit 6108 The Center 99 Queen’s Road Central Central Hong Kong

Dear Sirs,

INSTRUCTIONS, PURPOSE & VALUATION DATE

In accordance with the instructions of Shanghai Zendai Property Limited (the “Company”) for us to carry out the valuation of the market value of the Properties (“Properties”) held by Nanjing Himalayas Real Estate Company Limited (南京喜瑪拉雅置業有限公司), Nanjing Zendai Kuanyu Real Estate Company Limited (南京証大寬域置業有限公司), Nanjing Thumb Development Company Limited (南京大拇指商業發展有限公司), Nanjing Shuiqingmuhua Real Estate Company Limited (南京水清木華置業有限公司), Nanjing Radisson Real Estate Company Limited (南京麗笙置業有限公司), Nanjing Zendai Delta Real Estate Company Limited (南京証大三角洲置業有限公司) (the “Target Companies”) in the People’s Republic of China (the “PRC”), we confirm that we have carried out inspection, made relevant enquiries and obtained such further information as we considered necessary for the purpose of providing you with our opinion of the market values of the Properties in existing state as at 30 June 2015.

– XI-1 –

PROPERTY VALUATION REPORT

APPENDIX XI

DEFINITION OF MARKET VALUE

Our valuations of each of the Properties represents its Market Value. The definition of Market Value adopted in The HKIS Valuation Standards 2012 Edition follows the International Valuation Standards published by the International Valuation Standards Council (“IVSC”). Market Value is defined by the IVSC as “the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion”.

VALUATION BASIS AND ASSUMPTION

Our valuation of the Properties excludes an estimated price inflated or deflated by special terms or circumstances such as atypical financing, sale and leaseback arrangement, special considerations or concessions granted by anyone associated with the sale, or any element of special value.

In the course of our valuation of the Properties held in the PRC, we have assumed that transferable land use rights in respect of the Properties for its specific term at nominal annual land use fee have been granted and that any premium payable has already been fully paid. We have relied on the information and advice given by the Company and the PRC legal opinion of the Company’s legal adviser, DACHENG LAW OFFICES (大成律師事務所) dated 3 July 2015, regarding the title to the Properties and the interest in the Properties. In valuing the Properties, we have assumed that the owner have enforceable title to the Properties and have free and uninterrupted rights to use, occupy or assign the Properties for the whole of the unexpired terms as granted.

No allowance has been made in our valuation for any charges, pledges or amounts owing on the Properties nor any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the Properties are free from encumbrances, restrictions and outgoings of any onerous nature which could affect its value.

METHODS OF VALUATION

In valuing the Properties which is held for development in the PRC; we have adopted Direct Comparison Approach by making reference to comparables sales evidence as available in the relevant market.

In valuing the Properties, we have complied with the requirements set out in Chapter 5 and Practice Note 12 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and The HKIS Valuation Standards 2012 Edition published by the Hong Kong Institutes of Surveyors.

– XI-2 –

PROPERTY VALUATION REPORT

APPENDIX XI

SOURCE OF INFORMATION

We have relied to a very considerable extent on the information given by the Company and the opinion of the PRC legal adviser as to PRC laws. We have accepted advice given to us on such matters as planning approvals or statutory notices, easements, tenure, identification of the Properties, particulars of occupancy, development scheme, site and floor areas and all other relevant matters.

Dimension, measurements and areas included in this valuation report are based on the information provided to us and are therefore only approximation. We have no reason to doubt the truth and accuracy of the information provided to us by the Company which is material to the valuations. We were also advised that no material facts have been omitted from the information supplied.

We would point out that the copies of documents provided to us are mainly compiled in Chinese characters and the transliteration into English represents our understanding of the contents. We would therefore advise the Company to make reference to the original Chinese edition of the documents and consult your legal adviser regarding the legality and interpretation of these documents.

TITLE INVESTIGATION

We have been provided by the Company with copies or extracts of documents. However, we have not searched the original documents to verify ownership or to ascertain any amendments. All documents have been used for reference only and all dimensions, measurements and areas are approximate.

SITE INSPECTION

Our DTZ Shanghai valuer, Lily Fang, has inspected the exterior and, wherever possible, the interior of the Properties in June 2015. However, we have not carried out any soil investigations to determine the suitability of the soil conditions and the services etc. for any future development. Our valuation is prepared on the assumption that these aspects are satisfactory and that no extraordinary expenses or delays will be incurred during the construction period.

Unless otherwise stated, we have not been able to carry out detailed on-site measurements to verify the site and floor areas of the Properties and we have assumed that the areas shown on the copies of documents handed to us are correct.

– XI-3 –

PROPERTY VALUATION REPORT

APPENDIX XI

CURRENCY

Unless otherwise stated, all sums stated in our valuations are in Renminbi, the official currency of the PRC. There is no exchange rate issue in our valuation.

We attach herewith a summary of valuations and valuation certificates.

Yours faithfully, for and on behalf of DTZ Debenham Tie Leung Limited Philip C Y Tsang Registered Professional Surveyor (General Practice) Registered China Real Estate Appraiser MSc, MHKIS Director

Note: Philip C Y Tsang is a Registered Professional Surveyor who has over 22 years’ experience in the valuation of properties in the PRC.

– XI-4 –

PROPERTY VALUATION REPORT

APPENDIX XI

SUMMARY OF VALUATIONS

Property
1.
Land Parcel A – two pieces of land located at the intersection
of Jiangbian Road and Longjiang Road, Gulou District,
Nanjing, Jiangsu Province, the PRC with site areas of
9,731.39 sq.m.
2.
Land Parcel B – a piece of land located at the intersection of
Xing’an Road and Longjiang Road, Gulou District, Nanjing,
Jiangsu Province, the PRC with a site area of 18,481.60 sq.m.
3.
Land Parcel C – two pieces of land located at the intersection
of Jiangbian Road and Tianxiangli, Gulou District, Nanjing,
Jiangsu Province, the PRC with site areas of 14,404.27 sq.m.
4.
Land Parcel D – two pieces of land located at the intersection
of Jiangbian Road and Jianning Road, Gulou District, Nanjing,
Jiangsu Province, the PRC with site areas of 15,565.86 sq.m.
5.
Land Parcel E – four pieces of land located at the intersection
of Zhongyang Road and Jianning Road, Gulou District,
Nanjing, Jiangsu Province, the PRC with site areas of
37,071.58 sq.m.
6.
Land Parcel F – two pieces of land located at the intersection
of south Rehe Road and Shiqiao Street, Gulou District,
Nanjing, Jiangsu Province, the PRC with site areas of
15,234.36 sq.m.
Grand total:

Market Value in
existing state as at
30 June 2015
RMB
552,000,000
686,000,000
343,000,000
1,176,000,000
815,000,000
1,006,000,000

4,578,000,000

– XI-5 –

PROPERTY VALUATION REPORT

APPENDIX XI

VALUATION CERTIFICATE

Property held for development in the PRC

					Market Value in
				Particulars of	existing state as at
	Property	Description and tenure		occupancy	30 June 2015
1.	Land Parcel A – two	The Property comprises	two parcels	The Property is	RMB552,000,000
	pieces of land located at	of land which are designated for		two parcels of
	the intersection of	commercial, office and hotel type		vacant land
	Jiangbian Road and	apartment uses, with a total site		pending for
	Longjiang Road, Gulou	area of approximately 9,731.39		development.
	District, Nanjing, Jiangsu	sq.m. with details as follows:
	Province, the PRC with
	site areas of 9,731.39	Lot No.	Site Area
	sq.m.		(sq.m.)
		07-01	2,998.52
		07-02	6,732.87
			9,731.39

The permitted plot ratio gross floor area of the Property is about 53,127.13 sq.m. with details as follows:

Lot No. 07-01 07-02	Permitted Plot Ratio Gross Floor Area (sq.m.) 5,997.04 47,130.09
	53,127.13

The Property is located in Gulou District which lies in the northwest of downtown area of Nanjing, the area is planned to be developed as Binjiang Business District, inclusive of high-end large scale retail and office developments, and high-end residential developments in the area.

The Property is planned for commercial, office and hotel type apartment uses use; there is no environmental issues and litigation dispute; there is no plan to change the use of the Property. There is no restriction on the use of the Property.

The land use rights of the Property has been granted for a term of 40 years for commercial services and 50 years for office and 65 years for hotel type apartment uses and statutory maximum land use term for other uses respectively, upon the handover of the Property from Nanjing Bureau of Land and Resources to the Target Companies.

– XI-6 –

PROPERTY VALUATION REPORT

APPENDIX XI

Notes:

(1) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131 dated 30 September 2010, the particulars of land grant are as follows:

Grantor : 南京市國土資源局 (Nanjing Bureau of Land and Resources) Grantee : 南京臨江老城改造建設投資有限公司 Location : Land No. 1, west of Jiangbian Road, Xiaguan District. Lot No. : 2010G32 Total Granted Site Area : 353,664.3 sq.m. Total Land Grant Fee : RMB12,141,000,000 payable in full before 27 September 2011. (including resettlement cost) Land Use : Wholesale and retail; Commercial and financial; Other commercial services; Residential and catering; Cultural and entertainment; Urban and rural composite residential. Land Use Term : Commercial, financial 40 years; (from land handover date) Hotel type apartment 65 years; Residential 70 years; Other land uses are granted at the statutory maximum land use term. Land Hand Over : The grantor will hand over the cleared land to the grantee before 30 March 2012. Building Covenant : To commence construction before 30 March 2012 and to complete the construction before 30 March 2018.

(2) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (the “Grantor”) and 南京臨江老城改造建設投資有限公司 (the “Grantee”) dated 7 January 2014, due to the adjustment of city master planning, the total site area of Land No. 1, west of Jiangbian Road, Xiaguan District has been adjusted to 359,853.75 sq.m., and the total land grant fee for Land No. 1 has been adjusted to RMB12,601,510,000 accordingly.

The particulars of the Property are as follows:

Lot No. : 07-01 Granted Site Area : 2,998.52 sq.m. Land Use : Commercial and office Plot Ratio : Maximum is 2 Coverage Ratio : Maximum is 50% Height Limit : 24 metres Greenery Ratio : No less than 20% Lot No. : 07-02 Granted Site Area : 6,732.87 sq.m. Land Use : Commercial and office Plot Ratio : Maximum is 7 Coverage Ratio : Maximum is 55% Height Limit : 150 metres Greenery Ratio : No less than 15%

Note: As advised, the Property is part of the above-said land in Notes (1) & (2)

– XI-7 –

PROPERTY VALUATION REPORT

APPENDIX XI

(3) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2015] No. 19, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (“Party A”), 南京臨江老城改造建設投資有限公司 (“Party B”) and 南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited) (“Party C”) dated 24 April 2015, Party A has agreed to change the Grantee of Lot 07-01 and 07-02 of Land No. 1, west of Jiangbian Road, Xiaguan District from Party B to Party C (wholly-owned subsidiary of Party B), the particulars of land grant are as follows:

Grantor	:	南京市國土資源局
		(Nanjing Bureau of Land and Resources)
Grantee	:	南京喜瑪拉雅置業有限公司
		(Nanjing Himalayas Real Estate Company Limited)
Location	:	Lot 07-01 and 07-02 of Land No. 1, west of Jiangbian Road, Xiaguan
		District.
Lot No.	:	07-01 and 07-02
Granted Site Area	:	07-01 : 2,998.52
(sq.m.)		07-02 : 6,732.87
		Total 9,731.39
Land Grant Fee	:	RMB257,460,000
Land Use	:	Commercial services, office and hotel type apartment uses
Plot Ratio	:	07-01 : 2.0
		07-02 : 7.0
Land Hand Over	:	N/A
Building Covenant	:	To commence construction within 1 year since land has been handed
		over and to complete construction within 3 years since construction
		commenced.

(4) According to Receipt of the Land Grant Fee No. 0183286654 dated 27 April 2015, 南京市財政局 (Nanjing Finance Bureau) has received the land grant fee of RMB257,460,000 for Lot 07-01 and 07-02 of Land No. 1, west of Jiangbian Road, Xiaguan District from 南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited).
(5) According to Business License No. 320106000250370 dated 22 May 2014, 南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited) was established with a registered capital of RMB20,000,000 for a valid operation period from 22 May 2014 to 21 May 2034.
(6) According to the PRC legal opinion:
(i) 南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited) was legally established and is a legal and valid existing enterprise;
(ii) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131, the Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32 and NGTZRHB[2015] No. 19, 南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited) is the grantee of the Property, and the land grant fee has been fully settled. It has the right to register for obtaining the Real Estate Title Certificate of the land; and
(iii) After 南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited) has obtained the Real Estate Title Certificate of the land, it would legally possess the land use rights and have the right to develop, occupy, possess, or otherwise dispose of the land use rights of the land.
(7) The status of title and grant of major approvals and licenses in accordance with the information provided by the Company and the opinion of the PRC legal adviser:

Real Estate Title Certificate No Grant Contract for State-owned Land Use Rights Yes Supplemental Agreement to Grant Contract for State-owned Land Use Rights Yes Receipt of the Land Grant Fee Yes Business License Yes

(8) The Land Parcels A to F are located in Gulou District, being one of the core districts of Nanjing, the capital of Jiangsu Province, the PRC. There are 2 planned metro lines No. 5 and No. 9 in the area, which are both estimated to be completed in 2020. Currently there are a few residential and commercial projects under construction in the immediate location of the Land Parcels. In valuing the Property, we have assumed approximately RMB10,390 per sq.m. on gross floor area basis for land. In undertaking our valuation, we have made reference to sales prices of land within the same district which have characteristics comparable to the Property. The prices of similar land range from approximately RMB6,643 to RMB12,347 per sq.m. on gross floor area basis. The unit rate assumed by us is consistent with the relevant comparables after due adjustments.

– XI-8 –

PROPERTY VALUATION REPORT

APPENDIX XI

VALUATION CERTIFICATE

Property held for development in the PRC

Property

Description and tenure

Market Value in Particulars of existing state as at occupancy 30 June 2015

Land Parcel B – a piece of land located at the intersection of Xing’an Road and Longjiang Road, Gulou District, Nanjing, Jiangsu Province, the PRC with a site area of 18,481.60 sq.m.
The Property comprises a parcel of land which is designated for commercial and financial uses, with a total site area of approximately 18,481.60 sq.m.

The permitted plot ratio gross floor area of the Property is about 64,685.60 sq.m.

The Property is a vacant land pending for development.

RMB686,000,000

The Property is planned for commercial and financial uses; there is no environmental issues and litigation dispute; there is no plan to change the use of the Property. There is no restriction on the use of the Property.

The land use rights of the Property has been granted for a term of 40 years for commercial and financial, upon the handover of the Property from Nanjing Bureau of Land and Resources to the Target Company.

– XI-9 –

PROPERTY VALUATION REPORT

APPENDIX XI

Notes:

(1) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131 dated 30 September 2010, the particulars of land grant are as follows:

Grantor : 南京市國土資源局 (Nanjing Bureau of Land and Resources) Grantee : 南京臨江老城改造建設投資有限公司 Location : Land No. 1, west of Xing’an Road, Xiaguan District. Lot No. : 2010G32 Total Granted Site Area : 353,664.3 sq.m. Total Land Grant Fee : RMB12,141,000,000 payable in full before 27 September 2011. (including resettlement cost) Land Use : Wholesale and retail; Commercial and financial Other commercial services Residential and catering; Cultural and entertainment; Urban and rural composite residential. Land Use Term : Commercial and financial 40 years; (from land handover date) Hotel type apartment 65 years; Residential 70 years; Other land uses are granted at the statutory maximum land use term. Land Hand Over : The grantor will hand over the cleared land to the grantee before 30 March 2012. Building Covenant : To commence construction before 30 March 2012 and to complete the construction before 30 March 2018.

(2) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (the “Grantor”) and 南京臨江老城改造建設投資有限公司 (the “Grantee”) dated 7 January 2014, due to the adjustment of city master planning, the total site area of Land No. 1, west of Xing’an Road, Xiaguan District has been adjusted to 359,853.75 sq.m., and the total land grant fee for Land No. 1 has been adjusted to RMB12,601,510,000 accordingly.

The particulars of the Property are as follows:

Lot No. : 07-04 Granted Site Area : 18,481.60 sq.m. Land Use : Commercial and financial Plot Ratio : Maximum is 3.5 Coverage Ratio : Maximum is 55% Height Limit : 40 metres Greenery Ratio : No less than 15%

Note: As advised, the Property is part of the above-said land in Notes (1) & (2)

– XI-10 –

PROPERTY VALUATION REPORT

APPENDIX XI

(3) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2014] No. 23, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (“Party A”), 南京臨江老城改造建設投資有限公司 (“Party B”) and 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited) (“Party C”) dated 26 May 2014, Party A has agreed to change the Grantee of Lot 07-04 of Land No. 1, west of Xing’an Road, Xiaguan District from Party B to Party C (wholly-owned subsidiary of Party B), the particulars of land grant are as follows:

Grantor : 南京市國土資源局 (Nanjing Bureau of Land and Resources) Grantee : 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited) Location : Lot 07-04 of Land No. 1, west of Xing’an Road, Xiaguan District. Lot No. : 07-04 Granted Site Area : 18,481.60 sq.m. (sq.m.) Land Grant Fee : RMB452,800,000 Land Use : Commercial and financial Plot Ratio : 3.5 Land Hand Over : The grantor will hand over the cleared land to the grantee before 30 June 2014. Building Covenant : To commence construction before 30 June 2015 and to complete the construction before 30 June 2018.

(4) According to Receipt of the Land Grant Fee No. 0183284405 dated 27 May 2014, 南京市財政局 (Nanjing Financial Bureau) has received the land grant fee of RMB452,800,000 for Lot 07-04 of Land No. 1, west of Xing’an Road, Xiaguan District from 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited).
(5) According to Business License No. 320106000240059 dated 29 April 2014, 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited) was established with a registered capital of RMB20,000,000 for a valid operation period from 13 February 2014 to 12 February 2034.
(6) According to the PRC legal opinion:
(i) 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited) was legally established and is a legal and valid existing enterprise;
(ii) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131, the Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32 and NGTZRHB[2014] No. 23, 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited) is the grantee of the Property, and the land grant fee has been fully settled. It has the right to register for obtaining the Real Estate Title Certificate of the land; and
(iii) After 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited) has obtained the Real Estate Title Certificate of the land, it would legally possess the land use rights and have the right to develop, occupy, possess, or otherwise dispose of the land use rights of the land.
(7) The status of title and grant of major approvals and licenses in accordance with the information provided by the Company and the opinion of the PRC legal adviser:

(8) The Land Parcels A to F are located in Gulou District, being one of the core districts of Nanjing, the capital of Jiangsu Province, the PRC. There are 2 planned metro lines No. 5 and No. 9 in the area, which are both estimated to be completed in 2020. Currently there are a few residential and commercial projects under construction in the immediate location of the Land Parcels. In valuing the Property, we have assumed approximately RMB10,605 per sq.m. on gross floor area basis for land. In undertaking our valuation, we have made reference to sales prices of land within the same district which have characteristics comparable to the Property. The prices of similar land range from approximately RMB6,643 to RMB12,347 per sq.m. on gross floor area basis. The unit rate assumed by us is consistent with the relevant comparables after due adjustments.

– XI-11 –

PROPERTY VALUATION REPORT

APPENDIX XI

VALUATION CERTIFICATE

Property held for development in the PRC

Property

Land Parcel C – two pieces of land located at the intersection of Jiangbian Road and Tianxiangli, Gulou District, Nanjing, Jiangsu Province, the PRC with site areas of 14,404.27 sq.m.

Description and tenure

The Property comprises two parcels of land which are designated for culture, entertainment and commercial, office, hotel type apartment uses respectively, with a total site area of approximately 14,404.27 sq.m. with details as follows:

Market Value in Particulars of existing state as at occupancy 30 June 2015 The Property is RMB343,000,000 two parcels of vacant land pending for development.

Lot No. 07-05 07-07	Site Area (sq.m.) 4,859.05 9,545.22
	14,404.27

The permitted plot ratio gross floor area of the Property is about 31,637.53 sq.m. with details as follows:

Lot No. 07-05 07-07	Permitted Plot Ratio Gross Floor Area (sq.m.) 7,774.48 23,863.05
	31,637.53

The Property is planned for culture, entertainment and commercial, office, hotel type apartment uses respectively; there is no environmental issues and litigation dispute; there is no plan to change the use of the Property. There is no restriction on the use of the Property.

The land use rights of the Property has been granted for a term of 40 years for culture, entertainment, commercial services and 50 years for office and 65 years for hotel type apartment, 70 years for urban and rural residential and statutory maximum land use term for other uses respectively, upon the handover of the Property from Nanjing Bureau of Land and Resources to the Target Company.

– XI-12 –

PROPERTY VALUATION REPORT

APPENDIX XI

Notes:

(1) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131 dated 30 September 2010, the particulars of land grant are as follows:

(2) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (the “Grantor”) and 南京臨江老城改造建設投資有限公司 (the “Grantee”) dated 7 January 2014, due to the adjustment of city master planning, the total site area of Land No. 1, west of Jiangbian Road, Xiaguan District has been adjusted to 359,853.75 sq.m., and the total land grant fee for Land No. 1 has been adjusted to RMB12,601,510,000 accordingly.

The particulars of the Property are as follows:

Lot No.	:		07-05
Granted Site Area	:		4,859.05 sq.m.
Land Use	:		Culture and entertainment
Plot Ratio	:		Maximum is 1.6
Coverage Ratio	:		Maximum is 55%
Height Limit	:		24 metres
Greenery Ratio	:		No less than 15%
Lot No.		:	07-07
Granted Site Area		:	9,545.22 sq.m.
Land Use		:	Commercial and financial
Plot Ratio		:	Maximum is 2.5
Coverage Ratio		:	Maximum is 55%
Height Limit		:	24 metres
Greenery Ratio		:	No less than 15%

Note: As advised, the Property is part of the above-said land in Notes (1) & (2)

– XI-13 –

PROPERTY VALUATION REPORT

APPENDIX XI

(3) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2015] No. 21, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (“Party A”), 南京臨江老城改造建設投資有限公司 (“Party B”) and 南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited) (“Party C”) dated 24 April 2015, Party A has agreed to change the Grantee of Lot 07-05 and 07-07 of Land No. 1, west of Jiangbian Road, Xiaguan District from Party B to Party C (wholly-owned subsidiary of Party B), the particulars of land grant are as follows:

Grantor	:	南京市國土資源局	南京市國土資源局
		(Nanjing	Bureau of Land and Resources)
Grantee	:	南京大拇指商業發展有限公司
		(Nanjing	Thumb Development Company Limited)
Location	:	Lot 07-05 and 07-07 of Land No. 1, west of Jiangbian Road, Xiaguan
		District.
Lot No.	:	07-05 and 07-07
Granted Site Area	:	07-05	: 4,859.05
(sq.m.)		07-07	: 9,545.22
		Total	14,404.27

Land Grant Fee	:	RMB153,240,000
Land Use	:	07-05	: Culture and entertainment
		07-07	: Commercial services, office and urban and rural
			residential (hotel type apartment)
Plot Ratio	:	07-05	: 1.6
		07-07	: 2.5
Land Hand Over	:	N/A
Building Covenant	:	To commence construction within		1 year since land has been		handed over
		and to	complete construction	within 3 years	since	construction
		commenced.

(4) According to Receipt of the Land Grant Fee No. 0183286670 dated 28 April 2015, 南京市財政局 (Nanjing Finance Bureau) has received the land grant fee of RMB153,240,000 for Lot 07-05 and 07-07 of Land No. 1, west of Jiangbian Road, Xiaguan District from 南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited).
(5) According to Business License No. 320106000250396 dated 22 May 2014, 南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited) was established with a registered capital of RMB20,000,000 for a valid operation period from 22 May 2014 to 21 May 2034.
(6) According to the PRC legal opinion:
(i) 南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited) was legally established and is a legal and valid existing enterprise;
(ii) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131, the Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32 and NGTZRHB[2015] No. 21, 南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited) is the grantee of the Property, and the land grant fee has been fully settled. It has the right to register for obtaining the Real Estate Title Certificate of the land; and
(iii) After 南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited) has obtained the Real Estate Title Certificate of the land, it would legally possess the land use rights and have the right to develop, occupy, possess, or otherwise dispose of the land use rights of the land.

– XI-14 –

APPENDIX XI

PROPERTY VALUATION REPORT

(7) The status of title and grant of major approvals and licenses in accordance with the information provided by the Company and the opinion of the PRC legal adviser:

Real Estate Title Certificate	No
Grant Contract for State-owned Land Use Rights	Yes
Supplemental Agreement to Grant Contract for State-owned Land Use Rights	Yes
Receipt of the Land Grant Fee	Yes
Business License	Yes

(8) The Land Parcels A to F are located in Gulou District, being one of the core districts of Nanjing, the capital of Jiangsu Province, the PRC. There are 2 planned metro lines No. 5 and No. 9 in the area, which are both estimated to be completed in 2020. Currently there are a few residential and commercial projects under construction in the immediate location of the Land Parcels. In valuing the Property, we have assumed approximately RMB10,842 per sq.m. on gross floor area basis for land. In undertaking our valuation, we have made reference to sales prices of land within the same district which have characteristics comparable to the Property. The prices of similar land range from approximately RMB6,643 to RMB12,347 per sq.m. on gross floor area basis. The unit rate assumed by us is consistent with the relevant comparables after due adjustments.

– XI-15 –

PROPERTY VALUATION REPORT

APPENDIX XI

VALUATION CERTIFICATE

Property held for development in the PRC

					Market Value in
				Particulars of	existing state as at
	Property	Description and tenure		occupancy	30 June 2015
4.	Land Parcel D – two	The Property comprises	two parcels	The Property is	RMB1,176,000,000
	pieces of land located at	of land which are designated for		two parcels of
	the intersection of	commercial, office and hotel type		vacant land
	Jiangbian Road and	apartment uses, with a total site		pending for
	Jianning Road, Gulou	area of approximately 15,565.86		development.
	District, Nanjing, Jiangsu	sq.m. with details as follows:
	Province, the PRC with
	site areas of 15,565.86	Lot No.	Site Area
	sq.m.		(sq.m.)
		07-08	9,059.62
		07-09	6,506.24
			15,565.86

The permitted plot ratio gross floor area of the Property is about 113,490.83 sq.m. with details as follows:

Lot No. 07-08 07-09	Permitted Plot Ratio Gross Floor Area (sq.m.) 67,947.15 45,543.68
	113,490.83

The Property is planned for commercial services, office and hotel type apartment uses; there is no environmental issues and litigation dispute; there is no plan to change the use of the Property. There is no restriction on the use of the Property.

The land use rights of the Property has been granted for a term of 40 years for commercial services and 50 years for office and 65 years for hotel type apartment and statutory maximum land use term for other uses respectively, upon the handover of the Property from Nanjing Bureau of Land and Resources to the Target Company.

– XI-16 –

PROPERTY VALUATION REPORT

APPENDIX XI

Notes:

(1) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131 dated 30 September 2010, the particulars of land grant are as follows:

Grantor : 南京市國土資源局 (Nanjing Bureau of Land and Resources) Grantee : 南京臨江老城改造建設投資有限公司 Location : Land No. 1, west of Jiangbian Road, Xiaguan District. Lot No. : 2010G32 Total Granted Site Area : 353,664.3 sq.m. Total Land Grant Fee : RMB12,141,000,000 payable in full before 27 September 2011. (including resettlement cost) Land Use : Wholesale and retail; Commercial and financial; Other commercial and services; Residential and catering; Cultural and entertainment; Urban and rural composite residential. Land Use Term : Commercial, financial 40 years; (from land handover date) Hotel type apartment 65 years; Residential 70 years; Other land uses are granted at the statutory maximum land use term. Land Hand Over : The grantor will hand over the cleared land to the grantee before 30 March 2012. Building Covenant : To commence construction before 30 March 2012 and to complete the construction before 30 March 2018.

(2) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (the “Grantor”) and 南京臨江老城改造建設投資有限公司 (the “Grantee”) dated 7 January 2014, due to the adjustment of city master planning, the total site area of Land No. 1, west of Jiangbian Road, Xiaguan District has been adjusted to 359,853.75 sq.m., and the total land grant fee for Land No. 1 has been adjusted to RMB12,601,510,000 accordingly.

The particulars of the Property are as follows:

Lot No. : 07-08 Granted Site Area : 9,059.62 sq.m. Land Use : Commercial and office mixed Plot Ratio : Maximum is 7.5 Coverage Ratio : Maximum is 50% Height Limit : 150 metres Greenery Ratio : No less than 15% Lot No. : 07-09 Granted Site Area : 6,506.24 sq.m. Land Use : Commercial and office mixed Plot Ratio : Maximum is 7 Coverage Ratio : Maximum is 55% Height Limit : 100 metres Greenery Ratio : No less than 15%

Note: As advised, the Property is part of the above-said land in Notes (1) & (2)

– XI-17 –

PROPERTY VALUATION REPORT

APPENDIX XI

(3) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2015] No. 18, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (“Party A”), 南京臨江老城改造建設投資有限公司 (“Party B”) and 南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited) (“Party C”) dated 24 April 2015, Party A has agreed to change the Grantee of Lot 07-08 and 07-09 of Land No. 1, west of Jiangbian Road, Xiaguan District from Party B to Party C (wholly-owned subsidiary of Party B), the particulars of land grant are as follows:

Grantor	:	南京市國土資源局
		(Nanjing Bureau of Land and Resources)
Grantee	:	南京水清木華置業有限公司
		(Nanjing Shuiqingmuhua Real Estate Company Limited)
Location	:	Lot 07-08 and 07-09 of Land No. 1, west of Jiangbian Road, Xiaguan
		District.
Lot No.	:	07-08 and 07-09
Granted Site Area	:	07-08 : 9,059.62
(sq.m.)		07-09 : 6,506.24
		Total 15,565.86

Land Grant Fee	:	RMB550,010,000
Land Use	:	Commercial services, office and hotel type		apartment
Plot Ratio	:	07-08 : 7.5
		07-09 : 7.0
Land Hand Over	:	N/A
Building Covenant	:	To commence construction within 1 year since land			has been	handed over
		and to complete construction	within	3 years	since	construction
		commenced.

(4) According to Receipt of the Land Grant Fee No. 0183286646 dated 27 April 2015, 南京市財政局 (Nanjing Finance Bureau) has received the land grant fee of RMB550,010,000 for Lot 07-08 and 07-09 of Land No. 1, west of Jiangbian Road, Xiaguan District from 南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited).
(5) According to Business License No. 320106000250388 dated 22 May 2014, 南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited) was established with a registered capital of RMB20,000,000 for a valid operation period from 22 May 2014 to 21 May 2034.
(6) According to the PRC legal opinion:
(i) 南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited) was legally established and is a legal and valid existing enterprise;
(ii) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131, the Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32 and NGTZRHB[2015] No. 18, 南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited) is the grantee of the Property, and the land grant fee has been fully settled. It has the right to register for obtaining the Real Estate Title Certificate of the land; and
(iii) After 南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited) has obtained the Real Estate Title Certificate of the land, it would legally possess the land use rights and have the right to develop, occupy, possess, or otherwise dispose of the land use rights of the land.

– XI-18 –

APPENDIX XI

PROPERTY VALUATION REPORT

(7) The status of title and grant of major approvals and licenses in accordance with the information provided by the Company and the opinion of the PRC legal adviser:

Real Estate Title Certificate	No
Grant Contract for State-owned Land Use Rights	Yes
Supplemental Agreement to Grant Contract for State-owned Land Use Rights	Yes
Receipt of the Land Grant Fee	Yes
Business License	Yes

(8) The Land Parcels A to F are located in Gulou District, being one of the core districts of Nanjing, the capital of Jiangsu Province, the PRC. There are 2 planned metro lines No. 5 and No. 9 in the area, which are both estimated to be completed in 2020. Currently there are a few residential and commercial projects under construction in the immediate location of the Land Parcels. In valuing the Property, we have assumed approximately RMB10,362 per sq.m. on gross floor area basis for land. In undertaking our valuation, we have made reference to sales prices of land within the same district which have characteristics comparable to the Property. The prices of similar land range from approximately RMB6,643 to RMB12,347 per sq.m. on gross floor area basis. The unit rate assumed by us is consistent with the relevant comparables after due adjustments.

– XI-19 –

PROPERTY VALUATION REPORT

APPENDIX XI

VALUATION CERTIFICATE

Property held for development in the PRC

					Market Value in
				Particulars of	existing state as at
	Property	Description and tenure		occupancy	30 June 2015
5.	Land Parcel E – four pieces	The Property comprises four parcels		The Property is	RMB815,000,000
	of land located at the	of land which are designated for		four parcels of
	intersection of Zhongyang	commercial, office and hotel type		vacant land
	Road and Jianning Road,	apartment uses, with a total site area		pending for
	Gulou District, Nanjing,	of approximately 37,071.58 sq.m.		development.
	Jiangsu Province, the PRC	with details as follows:
	with site areas of 37,071.58
	sq.m.	Lot No.	Site Area
			(sq.m.)
		07-10	7,668.76
		07-11	9,058.86
		07-13	17,357.93
		07-14	2,986.03
			37,071.58

The permitted plot ratio gross floor area of the Property is about 75,998.97 sq.m. with details as follows:

Lot No. 07-10 07-11 07-13 07-14	Permitted Plot Ratio Gross Floor Area (sq.m.) 19,171.90 18,117.72 31,244.27 7,465.08
	75,998.97

The Property is planned for commercial, office and hotel type apartment uses; there is no environmental issues and litigation dispute; there is no plan to change the use of the Property. There is no restriction on the use of the Property.

The land use rights of the Property has been granted for a term of 40 years for commercial and 50 years for office and 65 years for hotel type apartment and statutory maximum land use term for other uses respectively, upon the handover of the Property from Nanjing Bureau of Land and Resources to the Target Company.

– XI-20 –

PROPERTY VALUATION REPORT

APPENDIX XI

Notes:

(1) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131 dated 30 September 2010, the particulars of land grant are as follows:

Grantor : 南京市國土資源局 (Nanjing Bureau of Land and Resources) Grantee : 南京臨江老城改造建設投資有限公司 Location : Land No. 1, west of Jiangbian Road, Xiaguan District. Lot No. : 2010G32 Total Granted Site Area : 353,664.3 sq.m. Total Land Grant Fee : RMB12,141,000,000 payable in full before 27 September 2011. (including resettlement cost) Land Use : Wholesale and retail; commercial and financial; Other commercial and services; Residential and catering; Cultural and entertainment; Urban and rural composite residential. Land Use Term : Commercial, financial 40 years; (from land handover date) Hotel type apartment 65 years; Residential 70 years; Other land uses are granted at the statutory maximum land use term. Land Hand Over : The grantor will hand over the cleared land to the grantee before 30 March 2012. Building Covenant : To commence construction before 30 March 2012 and to complete the construction before 30 March 2018.

(2) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (the “Grantor”) and 南京臨江老城改造建設投資有限公司 (the “Grantee”) dated 7 January 2014, due to the adjustment of city master planning, the total site area of Land No. 1, west of Jiangbian Road, Xiaguan District has been adjusted to 359,853.75 sq.m., and the total land grant fee for Land No. 1 has been adjusted to RMB12,601,510,000 accordingly.

The particulars of the Property are as follows:

Lot No. : 07-10 Granted Site Area : 7,668.76 sq.m. Land Use : Commercial and financial Plot Ratio : Maximum is 2.5 Coverage Ratio : Maximum is 55% Height Limit : 24 metres Greenery Ratio : No less than 15% Lot No. : 07-11 Granted Site Area : 9,058.86 sq.m. Land Use : Commercial and financial Plot Ratio : Maximum is 2 Coverage Ratio : Maximum is 55% Height Limit : 24 metres Greenery Ratio : No less than 15%

– XI-21 –

PROPERTY VALUATION REPORT

APPENDIX XI

Lot No. : 07-13 Granted Site Area : 17,357.93 sq.m. Land Use : Commercial and financial Plot Ratio : Maximum is 1.8 Coverage Ratio : Maximum is 55% Height Limit : 24 metres Greenery Ratio : No less than 15% Lot No. : 07-14 Granted Site Area : 2,986.03 sq.m. Land Use : Commercial and financial Plot Ratio : Maximum is 2.5 Coverage Ratio : Maximum is 55% Height Limit : 24 metres Greenery Ratio : No less than 15%

Note: As advised, the Property is part of the above-said land in Notes (1) & (2)

(3) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2015] No. 20, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (“Party A”), 南京臨江老城改造建設投資有限公司 (“Party B”) and 南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited) (“Party C”) dated 24 April 2015, Party A has agreed to change the Grantee of Lot 07-10, 07-11, 07-13 and 07-14 of Land No. 1, west of Jiangbian Road, Xiaguan District from Party B to Party C (wholly-owned subsidiary of Party B), the particulars of land grant are as follows:

Grantor	:	南京市國土資源局
		(Nanjing Bureau of Land and Resources)
Grantee	:	南京麗笙置業有限公司
		(Nanjing Radisson Real Estate Company	Limited)
Location	:	Lot 07-10, 07-11, 07-13 and 07-14 of Land No. 1,			west of	Jiangbian
		Road, Xiaguan District.
Lot No.	:	Lot 07-10, 07-11, 07-13 and 07-14
Granted Site Area	:	07-10 : 7,668.76
(sq.m.)		07-11 : 9,058.86
		07-13 : 17,357.93
		07-14 : 2,986.03
		Total 37,071.58

Land Grant Fee	:	RMB368,310,000
Land Use	:	Commercial, office and hotel type apartment		uses
Plot Ratio	:	07-10 : 19,171.90
		07-11 : 18,117.72
		07-13 : 31,244.27
		07-14 : 7,465.08
		Total 75,998.97

Land Hand Over	:	N/A
Building Covenant	:	To commence construction within 1 year since land			has been handed over
		and to complete construction within	3	years	since	construction
		commenced.

(4) According to Receipt of the Land Grant Fee No.0183286662 dated 27 April 2015, 南京市財政局 (Nanjing Financial Bureau) has received the land grant fee of RMB368,310,000 for Lot 07-10, 07-11, 07-13 and 07-14 of Land No. 1, west of Jiangbian Road, Xiaguan District from 南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited).

– XI-22 –

PROPERTY VALUATION REPORT

APPENDIX XI

(5) According to Business License No. 320106000250407 dated 22 May 2014, 南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited) was established with a registered capital of RMB20,000,000 for a valid operation period from 22 May 2014 to 21 May 2034.
(6) According to the PRC legal opinion:
(i) 南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited) was legally established and is a legal and valid existing enterprise;
(ii) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131, the Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32 and NGTZRHB[2015] No. 20, 南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited) is the grantee of the Property, and the land grant fee has been fully settled. It has the right to register for obtaining the Real Estate Title Certificate of the land; and
(iii) After 南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited) has obtained the Real Estate Title Certificate of the land, it would legally possess the land use rights and have the right to develop, occupy, possess, or otherwise dispose of the land use rights of the land.
(7) The status of title and grant of major approvals and licenses in accordance with the information provided by the Company and the opinion of the PRC legal adviser:

Real Estate Title Certificate	No
Grant Contract for State-owned Land Use Rights	Yes
Supplemental Agreement to Grant Contract for State-owned Land Use Rights	Yes
Receipt of the Land Grant Fee	Yes
Business License	Yes

(8) The Land Parcels A to F are located in Gulou District, being one of the core districts of Nanjing, the capital of Jiangsu Province, the PRC. There are 2 planned metro lines No. 5 and No. 9 in the area, which are both estimated to be completed in 2020. Currently there are a few residential and commercial projects under construction in the immediate location of the Land Parcels. In valuing the Property, we have assumed approximately RMB10,724 per sq.m. on gross floor area basis for land. In undertaking our valuation, we have made reference to sales prices of land within the same district which have characteristics comparable to the Property. The prices of similar land range from approximately RMB6,643 to RMB12,347 per sq.m. on gross floor area basis. The unit rate assumed by us is consistent with the relevant comparables after due adjustments.

– XI-23 –

PROPERTY VALUATION REPORT

APPENDIX XI

VALUATION CERTIFICATE

Property held for development in the PRC

Market Value in Particulars of existing state as at Property Description and tenure occupancy 30 June 2015 6. Land Parcel F – two The Property comprises two parcels The Property is RMB1,006,000,000 pieces of land located at of land which are designated for two parcels of the intersection of south commercial and office mixed uses, vacant land Rehe Road and Shiqiao with a total site area of pending for Street, Gulou District, approximately 15,234.36 sq.m. with development. Nanjing, Jiangsu Province, details as follows: the PRC with site areas of 15,234.36 sq.m.

Lot No. 09-10 09-11	Site Area (sq.m.) 7,197.57 8,036.79
	15,234.36

The permitted plot ratio gross floor area of the Property is about 90,566.94 sq.m. with details as follows:

Lot No. 09-10 09-11	Permitted Plot Ratio Gross Floor Area (sq.m.) 50,382.99 40,183.95
	90,566.94

The Property is planned for commercial and office mixed; there is no environmental issues and litigation dispute; there is no plan to change the use of the Property. There is no restriction on the use of the Property.

The land use rights of the Property has been granted for a term of 40 years for commercial and 50 years for office (statutory maximum land use term) uses, upon the handover of the Property from Nanjing Bureau of Land and Resources to the Target Company.

– XI-24 –

PROPERTY VALUATION REPORT

APPENDIX XI

Notes:

(1) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131 dated 30 September 2010, the particulars of land grant are as follows:

Grantor : 南京市國土資源局 (Nanjing Bureau of Land and Resources) Grantee : 南京臨江老城改造建設投資有限公司 Location : Land No. 1, west of Jiangbian Road, Xiaguan District. Lot No. : 2010G32 Total Granted Site Area : 353,664.3 sq.m. Total Land Grant Fee : RMB12,141,000,000 payable in full before 27 September 2011. (including resettlement cost) Land Use : Wholesale and retail; Commercial and financial; Other commercial and services; Residential and catering; Cultural and entertainment; Urban and rural composite residential. Land Use Term : Commercial, financial 40 years; (from land handover date) Hotel type apartment 65 years; Residential 70 years; Other land uses are granted at the statutory maximum land use term. Land Hand Over : The grantor will hand over the cleared land to the grantee before 30 March 2012. Building Covenant : To commence construction before 30 March 2012 and to complete the construction before 30 March 2018.

(2) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (the “Grantor”) and 南京臨江老城改造建設投資有限公司 (the “Grantee”) dated 7 January 2014, due to the adjustment of city master planning, the total site area of Land No. 1, west of Jiangbian Road, Xiaguan District has been adjusted to 359,853.75 sq.m., and the total land grant fee for Land No. 1 has been adjusted to RMB12,601,510,000 accordingly.

The particulars of the Property are as follows:

Lot No. : 09-10 Granted Site Area : 7,197.57 sq.m. Land Use : Commercial and office mixed Plot Ratio : Maximum is 7 Coverage Ratio : Maximum is 55% Height Limit : 120 metres Greenery Ratio : No less than 15% Lot No. : 09-11 Granted Site Area : 8,036.79 sq.m. Land Use : Commercial and office mixed Plot Ratio : Maximum is 5 Coverage Ratio : Maximum is 50% Height Limit : 80 metres Greenery Ratio : No less than 20%

Note: As advised, the Property is part of the above-said land in Notes (1) & (2)

– XI-25 –

PROPERTY VALUATION REPORT

APPENDIX XI

(3) According to Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2014] No. 22, entered into between 南京市國土資源局 (Nanjing Bureau of Land and Resources) (“Party A”), 南京臨江老城改造建設投資有限公司 (“Party B”) and 南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited) (“Party C”) dated 26 May 2014, Party A has agreed to change the Grantee of Lot 09-10 and 09-11 of Land No. 1, west of Jiangbian Road, Xiaguan District from Party B to Party C (wholly-owned subsidiary of Party B), the particulars of land grant are as follows:

Grantor	:	南京市國土資源局
		(Nanjing Bureau of Land and Resources)
Grantee	:	南京証大三角洲置業有限公司
		(Nanjing Zendai Delta Real Estate Company Limited)
Location	:	Lot 09-10 and 09-11 of Land No. 1, west of Jiangbian Road, Xiaguan
		District.
Lot No.	:	09-10 and 09-11
Granted Site Area	:	09-10 : 7,197.57
(sq.m.)		09-11 : 8,036.79
		Total 15,234.36
Land Grant Fee	:	RMB633,970,000
Land Use	:	Commercial and office mixed
Plot Ratio	:	09-10 : 7.0
		09-11 : 5.0
Land Hand Over	:	The grantor will hand over the cleared land to the grantee before 30 March
		2012.
Building Covenant	:	To commence construction before 30 March 2012 and to complete the
		construction before 30 March 2018.

(4) According to Receipt of the Land Grant Fee No. 0183284413 dated 27 May 2014, 南京市財政局 (Nanjing Finance Bureau) has received the land grant fee of RMB633,970,000 for Lot 09-10 and 09-11 of Land No. 1, west of Jiangbian Road, Xiaguan District from 南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited).
(5) According to Business License No. 320106000240067 dated 29 April 2014, 南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited) was established with a registered capital of RMB20,000,000 for a valid operation period from 13 February 2014 to 12 February 2034.
(6) According to the PRC legal opinion:
(i) 南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited) was legally established and is a legal and valid existing enterprise;
(ii) According to Grant Contract for State-owned Land Use Rights No. 3201012010CR0131, the Supplemental Agreement to Grant Contract for State-owned Land Use Rights NGTZRHB[2013] No. 32 and NGTZRHB[2014] No. 22, 南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited) is the grantee of the Property, and the land grant fee has been fully settled. It has the right to register for obtaining the Real Estate Title Certificate of the land; and
(iii) After 南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited) has obtained the Real Estate Title Certificate of the land, it would legally possess the land use rights and have the right to develop, occupy, possess, or otherwise dispose of the land use rights of the land.

– XI-26 –

APPENDIX XI

PROPERTY VALUATION REPORT

(7) The status of title and grant of major approvals and licenses in accordance with the information provided by the Company and the opinion of the PRC legal adviser:

Real Estate Title Certificate	No
Grant Contract for State-owned Land Use Rights	Yes
Supplemental Agreement to Grant Contract for State-owned Land Use Rights	Yes
Receipt of the Land Grant Fee	Yes
Business License	Yes

(8) The Land Parcels A to F are located in Gulou District, being one of the core districts of Nanjing, the capital of Jiangsu Province, the PRC. There are 2 planned metro lines No. 5 and No. 9 in the area, which are both estimated to be completed in 2020. Currently there are a few residential and commercial projects under construction in the immediate location of the Land Parcels. In valuing the Property, we have assumed approximately RMB11,108 per sq.m. on gross floor area basis for land. In undertaking our valuation, we have made reference to sales prices of land within the same district which have characteristics comparable to the Property. The prices of similar land range from approximately RMB6,643 to RMB12,347 per sq.m. on gross floor area basis. The unit rate assumed by us is consistent with the relevant comparables after due adjustments.

– XI-27 –

GENERAL INFORMATION

APPENDIX XII

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 Group. 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. DISCLOSURE OF INTERESTS

(a) Interests and short positions of the Directors in the Shares, underlying shares and debentures of the Company and its associated corporations

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executives of the Company in the shares, underlying shares and debentures of the Company and its associated corporations (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 they were taken or deemed 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 to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (“Model Code”) as set out in Appendix 10 to the Listing Rules as adopted by the Company, were as follows:

			Approximate
			percentage of
Name of Director/	Capacity and	Number of Shares/	issued
chief executives	nature of interests	underlying Shares	capital
Mr. Tang Jian	Beneficial owner	10,000,000 (L)	0.07%

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or chief executives of the Company had any interests and short positions in the shares, underlying shares and debentures of the Company or any of its associated corporations (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 any such Director was taken or deemed to have under such provisions of the SFO); or which was required, pursuant to section 352 of the SFO, to be entered in the register referred to therein, or which was required, pursuant to the Model Code to be notified to the Company and the Stock Exchange.

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

– XII-1 –

GENERAL INFORMATION

APPENDIX XII

(b) Interests and short positions of the substantial Shareholders in the Shares, underlying shares and debentures of the Company

As at the Latest Practicable Date, so far as was known to the Directors or chief executive of the Company, the following persons (other than the Directors or chief executive of the Company) had, or were deemed or taken to have, an interest or short position in the Shares and underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO or, who were, directly or indirectly, interested in 5% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or held any option in respect of such capital:

			Approximate
			percentage of
Name of substantial			total issued
Shareholders	Capacity	Number of Shares	Shares
Smart Success	Beneficial owner	7,165,566,000 (L)	48.16%
Capital Ltd. (Note 1)
Wise Leaders Assets	Interest in controlled	7,165,566,000 (L)	48.16%
Ltd. (Note 1)	corporation
Dong Yin Development	Interest in controlled	7,165,566,000 (L)	48.16%
(Holdings) Limited	corporation
(Note 1)
COS Greater China	Interest in controlled	7,165,566,000 (L)	48.16%
Special Situations	corporation
Fund, L.P. (Note 1)
China Orient Summit	Interest in controlled	7,165,566,000 (L)	48.16%
Capital SSF GP	corporation
Co. Ltd. (Note 1)
China Orient Summit	Interest in controlled	7,165,566,000 (L)	48.16%
Capital International	corporation
Co. Ltd. (Note 1)
COAMI (Note 1)	Interest in controlled	7,165,566,000 (L)	48.16%
	corporation
Cheer Link Global Ltd.	Interest in controlled	7,165,566,000 (L)	48.16%
(Note 1)	corporation
中國東方資產管理公司	Interest in controlled	7,165,566,000 (L)	48.16%
(COAMC) (Note 1)	corporation
China Alliance	Beneficial owner	2,091,260,000 (L)	14.05%
Properties Limited
(Note 2)
Shanghai Forte Land	Interest in controlled	2,091,260,000 (L)	14.05%
Co., Ltd (Note 2)	corporation

– XII-2 –

GENERAL INFORMATION

APPENDIX XII

			Approximate
			percentage of
Name of substantial			total issued
Shareholders	Capacity	Number of Shares	Shares
Shanghai Fosun High	Interest in controlled	2,091,260,000 (L)	14.05%
Technology (Group)	corporation
Company Limited
(Note 2)
Fosun International	Interest in controlled	2,091,260,000 (L)	14.05%
Limited (Note 2)	corporation
Fosun Holdings Limited	Interest in controlled	2,091,260,000 (L)	14.05%
(Note 2)	corporation
Fosun International	Interest in controlled	2,091,260,000 (L)	14.05%
Holdings Ltd.	corporation
(Note 2)
Guo Guangchang	Interest in controlled	2,091,260,000 (L)	14.05%
(Note 2)	corporation

Notes:

According to published information, (i) 中國東方資產管理公司 (COAMC) has 100% control of Dong Yin Development (Holdings) Limited, which in turn has 100% control of Wise Leaders Assets Ltd.; (ii) Wise Leaders Assets Ltd. and Dong Yin Development (Holdings) Limited each has 50% control of COAMI; and (iii) COAMI has 80% control of China Orient Summit Capital International Co. Ltd., which in turn has 100% control of China Orient Summit Capital SSF GP Co. Ltd. China Orient Summit Capital SSF GP Co. Ltd. is the only general partner of COS Greater China Special Situations Fund, L.P. According to published information, COS Greater China Special Situations Fund L.P. has 100% control of Cheer Link Global Ltd. which in turn has 100% control of Smart Success Capital Ltd..
According to published information, Mr. Guo Guangchang has 58% control of Fosun International Holdings Ltd., which has 100% control of Fosun Holdings Limited, which has 71.29% control of Fosun International Limited, which has 100% control of Shanghai Fosun High Technology (Group) Company Limited, which together with Fosun International Limited have approximately 99.11% control of Shanghai Forte Land Co., Ltd., which has 100% control of China Alliance Properties Limited.

Save as disclosed above, as at the Latest Practicable Date, so far as was known to the Directors, no other person (other than the Directors or chief executive of the Company) had, or was deemed or taken to have an interest or short position in the Shares or/and underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

Save as disclosed above, as at the Latest Practicable Date, according to the register of interests required to be kept by the Company under Section 336 of the SFO, no other persons were recorded to hold any long or short positions in the shares or underlying shares or the equity derivatives of the Company.

– XII-3 –

GENERAL INFORMATION

APPENDIX XII

3. COMPETING BUSINESS

As at the Latest Practicable Date, none of the Directors and his associates had any interests which competes or was likely to compete, either directly or indirectly, with the Company’s business.

4. SERVICE CONTRACTS

Ms. Li Li Hua, an executive Director of the Company, has entered into a service contract with the Company which may be terminated by either party by giving one-month notice to the other party. Effective from 1 December 2014, Ms. Li Li Hua is entitled to receive a fixed remuneration of RMB2,600,000 per annum and a discretionary bonus to be determined with reference to her duties, responsibilities and market practice, as well as the Company’s remuneration policy and is subject to review by the remuneration committee of the Board.

Save as disclosed above, as at the Latest Practicable Date, there was no existing service contract or any proposed service contract between any of the Directors or proposed Directors and any member of the Enlarged Group within a year without payment of any compensation (other than statutory compensation).

5. DIRECTORS’ INTEREST IN ASSETS

None of the Directors had any direct or indirect interest in any asset which had been, since 31 December 2014 (being the date to which the latest published audited consolidated financial statements of the Group were made up) and up to the Latest Practicable Date, acquired or disposed of by or leased to or are proposed to be acquired or disposed of by or leased to any member of the Enlarged Group.

6. DIRECTORS’ INTEREST IN CONTRACTS

There was no contract of significance in relation to the Enlarged Group’s business to which the Company, its subsidiaries, its fellow subsidiaries or its holding company was a party and in which a Director had a material interest, whether directly or indirectly, subsisting as at the Latest Practicable Date.

7. LITIGATION

Reference is made to the announcements of the Company dated 30 December 2011, 31 May 2012, 5 June 2012, 2 August 2012, 29 November 2012, 30 November 2012 and 24 April 2013. On 4 June 2012, Shanghai Zendai Land Company Limited (“Shanghai Zendai Land”), a wholly-owned subsidiary of the Company, was served a document of summons issued by Shanghai No. 1 Intermediate People’s Court (“the Court”) in relation to disputes on asset damage and compensation and breaching of pre-emptive rights in shareholding of Shanghai Haizhimen Property Management Co., Ltd., the then associate of the Company, initiated by Zhejiang Fosun Commerce Development Limited. On 24 April 2013, the Court issued a first

– XII-4 –

APPENDIX XII

GENERAL INFORMATION

instance judgment (the “Judgment”) and granted an order to (i) invalidate the agreement on disposal (“Wudaokou Disposal”) of Shanghai Zendai Wudaokou Property Company Limited (“Shanghai Zendai Wudaokou”); (ii) invalidate the share transfer agreement relating to the transfer of the entire equity interests of Shanghai Zendai Wudaokou to an independent third party; and (iii) restate the ownership of Shanghai Zendai Wudaokou within 15 days after the effective date of the Judgment to the state prior to the transfer. On 7 May 2013, an appeal (the “Appeal”) was lodged with the Higher People’s Court of Shanghai against the Judgment. Since the Appeal has been duly lodged, the Judgment cannot be enforced and will not become effective pending the results of the Appeal. As at the Latest Practicable Date, the results of the Appeal were still pending.

In case the Appeal is unsuccessful, the equity interests of Shanghai Zendai Wudaokou would revert to the Group and the previously received consideration which amounted to RMB2,860,000,000 may need to be paid back to the purchaser to the abovementioned agreement (“Wudaokou Purchaser”). The Company’s PRC legal advisers, King & Wood Mallesons, consider that the legal grounds on which the Judgment was based are mistaken and are of the view that there are valid grounds for the Appeal and that the Company has a reasonable chance to win the Appeal. The Company considers that the Judgement does not have any material adverse effect on the operations or financial position of the Group. The Board, after consultation with the PRC legal advisers, King & Wood Mallesons, does not consider a need to make any provision in respect of the Appeal and Judgement, nor any impairment in respect of other receivables amounting to RMB100,000,000 in respect of outstanding portion of the consideration due from the Wudaokou Purchaser.

Save as disclosed above, as at the Latest Practicable Date, the Enlarged Group was not engaged in any litigation, arbitration or claim of material importance and no litigation, arbitration or claim of material importance was known to the Directors to be pending or threatened against the Enlarged Group.

8. EXPERTS AND CONSENTS

The following are the qualification of the experts who have been named in this circular or have given opinion or advice which are contained in this circular:

Name	Qualification
Dacheng Law Offices	A PRC legal adviser
DTZ Debenham Tie Leung Limited	An independent valuer
King & Wood Mallesons	A PRC legal adviser
PricewaterhouseCoopers	Certified Public Accountants

The above experts have given and have not withdrawn its written consent to the issue of this circular with the inclusion of its letter and/or reference to its name in the form and context in which it appears.

– XII-5 –

GENERAL INFORMATION

APPENDIX XII

As at the Latest Practicable Date, the above experts did not have any shareholding in any member of the Enlarged Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Enlarged Group, or any interests, directly or indirectly, in any assets which had been, since 31 December 2014, being the date to which the latest published audited financial statements of the Enlarged Group were made up, acquired, disposed of or leased to any member of the Enlarged Group, or were proposed to be acquired, disposed of or leased to any member of the Enlarged Group.

9. MATERIAL CONTRACTS

The following contracts (not being contracts entered into in the ordinary course of business) were entered into by members of the Enlarged Group within two years immediately preceding the Latest Practicable Date and are or may be material:

(a) the framework agreement dated 4 November 2013 entered into among the Group, AECI Limited, Heartland Properties (Proprietary) Limited and AECI Real Estate (Proprietary) Limited in respect of the acquisition of, among others, certain immovable properties located in the Modderfontein area at a consideration of approximately ZAR930.68 million, details of which are disclosed in the circular of the Company dated 20 December 2013;
(b) the share transfer agreement dated 10 March 2014 entered into between Long Profit Group Limited (“Long Profit”), an indirect non wholly-owned subsidiary of the Company, and the Seller for the acquisition of the entire share capital of the Bidding Subsidiary at a consideration of RMB902,300,000, details of which are disclosed in the circular of the Company dated 17 February 2014 and the supplemental circular of the Company dated 30 April 2014;
(c) the sale and purchase agreement dated 24 March 2014 entered into between the Company and Power Rider Enterprises Corp. in respect of the disposal of 20% of the issued share capital of Richtex Holdings Limited at a consideration of RMB200,000,000, details of which are disclosed in the announcement of the Company dated 24 March 2014;
(d) the subscription agreement dated 24 March 2014 entered into among Hero Horse Holding Limited, Long Profit and Wisdom Mind Holdings Corp in respect of the subscription of new shares to be issued by Long Profit at a consideration of HK$20, details of which are disclosed in the announcement of the Company dated 24 March 2014;
(e) the share transfer agreement dated 20 November 2014 entered into between the Bidding Subsidiary and the Seller for the acquisition of the entire share capital of and the shareholder’s loan due from 南京五道口置業有限公司 (Nanjing Wudaokou Real Estate Co., Ltd.*) at a consideration of RMB1,043,210,000, details of which are disclosed in the circular of the Company dated 7 July 2014 and the supplemental circular of the Company dated 22 December 2014;

– XII-6 –

GENERAL INFORMATION

APPENDIX XII

(f) the sale and purchase agreement dated 16 July 2015 entered into between 海門証大濱江置業有限公司 (Haimen Zendai Binjiang Properties Company Limited, “Haimen Zendai”), a wholly-owned subsidiary of the Company, 蕪湖歌斐証瑞投資中心(有限合夥) (Wuhu Gefei Zhengrui Investment Centre (limited partnership)) and 北京永利時代投資控股有限責任公司 (Beijing Yongli Shidai Investment Holding Company Limited) in relation to, among other things, the disposal of the 73% of the issued share capital of 廊坊市証合泰房地產開發有限公司 (Langfang Zhenghetai Property Development Company Limited*) by Haimen Zendai at a consideration of RMB127.00 million, details of which are disclosed in the announcement of the Company dated 16 July 2015; and
(g) the Equity Transfer Agreements and the Supplemental Agreement.

10. MISCELLANEOUS

(a) The secretary of the Company and the qualified accountant of the Company is Mr. Wong Ngan Hung, who is a member of Hong Kong Institute of Certified Public Accountants.
(b) The registered office of the Company is situated at Canon’s Court, 22 Victoria Street, Hamilton HM12, Bermuda. The head office and principal place of business of the Company in Hong Kong is situated at Unit 6108, 61/F., The Center, 99 Queen’s Road Central, Hong Kong.
(c) The Hong Kong branch share registrar and transfer office of the Company is Tricor Secretaries Limited at Level 22, Hopewell Center, 183 Queen’s Road East, Wanchai, Hong Kong.
(d) The English texts of this circular and the accompanying proxy form shall prevail over the Chinese texts in case of inconsistency.

11. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at Unit 6108, 61/F., The Center, 99 Queen’s Road Central, Hong Kong during normal business hours (except Saturdays and public holidays) from the date of this circular up to and including the date of the SGM:

(a) the memorandum of association and the bye-laws of the Company;
(b) the annual reports of the Company for the two financial years ended 31 December 2014;
(c) the accountant’s report of each of the Target Companies, the text of which is set out in Appendix II to Appendix VII to this circular;
(d) the accountant’s report on the unaudited pro forma financial information of the Enlarged Group, the text of which is set out in Appendix X to this circular;

– XII-7 –

GENERAL INFORMATION

APPENDIX XII

(e) the letter and valuation certificate relating to the Land Parcels prepared by DTZ Debenham Tie Leung Limited, the texts of which are set out in Appendix XI to this circular;
(f) the PRC legal opinion of Dacheng Law Offices dated 3 July 2015 in respect of the Target Companies and the Land Parcels;
(g) the PRC legal opinion of King & Wood Mallesons dated 27 August 2015 in respect of the Wudaokou Disposal and the Judgement;
(h) the service contract referred to in the paragraph under the heading “4. Service contracts” in this appendix;
(i) the written consents referred to in the paragraph under the heading “8. Experts and consents” in this appendix;
(j) the material contracts referred to in the paragraph under the heading “9. Material contracts” in this appendix; and
(k) a copy of this circular.

– XII-8 –

NOTICE OF SGM

SHANGHAI ZENDAI PROPERTY LIMITED 上海証大房地產有限公司[*]

(Incorporated in Bermuda with limited liability) (Stock code: 755)

NOTICE OF SPECIAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that a special general meeting of Shanghai Zendai Property Limited (the “Company”) will be held at Unit A, 29/F, Admiralty Center I, 18 Harcourt Road, Hong Kong, on Tuesday, 13 October 2015, at 10:30 a.m. to consider and, if thought fit, pass, with or without modification, the following resolution as ordinary resolution of the Company:

ORDINARY RESOLUTION

“ THAT :

the equity transfer agreements dated 12 August 2015 (the “Equity Transfer Agreements”) and the supplemental agreement dated 24 August 2015 (the “Supplemental Agreement”) entered into between the Bidding Subsidiary and the Seller (both as defined in the circular of the Company dated 24 September 2015, a copy of which is marked “A” and tabled before the meeting and initialed by the chairman of the meeting for identification purpose), pursuant to which the Bidding Subsidiary has conditionally agreed to acquire from the Seller, the entire registered capital of 南京喜瑪拉雅置業有限公司 (Nanjing Himalayas Real Estate Company Limited), 南京証大寬域置業有限公司 (Nanjing Zendai Kuanyu Real Estate Company Limited), 南京大拇指商業發展有限公司 (Nanjing Thumb Development Company Limited), 南京水清木華置業有限公司 (Nanjing Shuiqingmuhua Real Estate Company Limited), 南京麗笙置業有限公司 (Nanjing Radisson Real Estate Company Limited), 南京証大三角洲置業有限公司 (Nanjing Zendai Delta Real Estate Company Limited) (the “ Target Companies ”) and the sale loans owing by the Target Companies to the Seller, at a consideration of approximately RMB4,513.61 million (equivalent to approximately HK$5,461.47 million) subject to the terms and conditions of the Equity Transfer Agreements as amended by the Supplemental Agreement, and the transactions contemplated thereunder be and are hereby approved, confirmed and ratified; and

– SGM-1 –

NOTICE OF SGM

any one director, or any two directors if the affixation of the common seal is necessary, of the Company be and is hereby authorized for and on behalf of the Company to do all such further acts and things and execute such further documents and take all such steps which in their opinion may be necessary, desirable or expedient to implement and/or give effect to the terms of the Equity Transfer Agreements as amended by the Supplemental Agreement and the transactions contemplated thereunder.”

By Order of the Board SHANGHAI ZENDAI PROPERTY LIMITED Li Li Hua Director

Hong Kong, 24 September 2015

Registered office:

Canon’s Court 22 Victoria Street Hamilton HM12 Bermuda

Principal place of business in Hong Kong:

Unit 6108, 61/F., The Center 99 Queen’s Road Central Hong Kong

Notes:

Any member entitled to attend and vote at a meeting of the Company is entitled to appoint another person as his proxy to attend and vote instead of him. A proxy need not be a member of the Company.
In order to be valid, the form of proxy together with any power of attorney or other authority under which it is signed or a certified copy of such power of attorney must be lodged with the Company’s branch registrar in Hong Kong, Tricor Secretaries Limited at Level 22, Hopewell Center, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the Meeting or any adjournment thereof, (as the case may be).
In the case of joint holders, the vote of the senior who tenders a vote, whether present in person or by proxy, will be accepted to the exclusion of the vote(s) of other joint holder(s), and for this purpose seniority shall be determined by the order in which the names stand in the register of members in respect of the joint holding.

As at the date of this notice, the executive Directors are Mr. Zhang Chenguang, Mr. Zhong Guoxing, Dr. Wang Hao and Ms. Li Li Hua. The non-executive Directors are Mr. Xu Xiaoliang and Mr. Gong Ping. The independent non-executive Directors are Mr. Lai Chik Fan, Mr. Li Man Wai, Mr. Chow, Alexander Yue Nong and Dr. Xu Changsheng.

– SGM-2 –

AI assistant

Snack Empire Holdings Limited — Proxy Solicitation & Information Statement 2015

50208_rns_2015-09-24_32efc499-f10a-4315-8a85-19ce624bd209.pdf

SHANGHAI ZENDAI PROPERTY LIMITED 上海証大房地產有限公司[*]

VERY SUBSTANTIAL ACQUISITION IN RESPECT OF THE ACQUISITIONS OF THE EQUITY INTERESTS AND THE SALE LOANS

Financial adviser to the Company

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

SHANGHAI ZENDAI PROPERTY LIMITED 上海証大房地產有限公司[*]

VERY SUBSTANTIAL ACQUISITION IN RESPECT OF THE ACQUISITIONS OF THE EQUITY INTERESTS AND THE SALE LOANS

INTRODUCTION

LETTER FROM THE BOARD

THE ACQUISITIONS

The Equity Transfer Agreement A

Details of the Acquisition A

The Consideration A

LETTER FROM THE BOARD

The Equity Transfer Agreement B

Parties :

Details of the Acquisition B

The Consideration B

LETTER FROM THE BOARD

The Equity Transfer Agreement C

Parties :

Details of the Acquisition C

The Consideration C

LETTER FROM THE BOARD

The Equity Transfer Agreement D

Parties :

Details of the Acquisition D

The Consideration D

LETTER FROM THE BOARD

The Equity Transfer Agreement E

Parties :

Details of the Acquisition E

The Consideration E

LETTER FROM THE BOARD

The Equity Transfer Agreement F

Parties :

Details of the Acquisition F

The Consideration F

LETTER FROM THE BOARD

Other principal terms of the Equity Transfer Agreements

LETTER FROM THE BOARD

Conditions precedent for the Equity Transfer Agreements becoming effective

LETTER FROM THE BOARD

Upon the Equity Transfer Agreements becoming effective

INFORMATION ON THE SELLER, THE TARGET COMPANIES AND THE LAND PARCELS

Information on the Seller

Information on the Target Companies

Target Company A

Target Company B

LETTER FROM THE BOARD

Target Company C

LETTER FROM THE BOARD

Target Company D

Target Company E

Target Company F

Information on the Land Parcels

LETTER FROM THE BOARD

REASONS FOR THE ACQUISITIONS

LETTER FROM THE BOARD

EFFECTS ON EARNINGS AND ASSETS AND LIABILITIES OF THE GROUP

Assets and liabilities

Earnings

IMPLICATIONS UNDER THE LISTING RULES

SGM

RECOMMENDATION

ADDITIONAL INFORMATION

1. FINANCIAL INFORMATION OF THE GROUP

2. INDEBTEDNESS STATEMENT

Borrowings

Securities

Contingent liabilities

Snack Empire Holdings Limited Proxy Solicitation & Information Statement 2015