Wanjia Group Holdings Limited — Capital/Financing Update 2013

Oct 10, 2013

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

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MIN XIN HOLDINGS LIMITED 閩信集團有限公司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 222)

CONNECTED TRANSACTION FORMATION OF JOINT VENTURE COMPANY

AND

ESTABLISHMENT OF MINXIN MICRO CREDIT

FORMATION OF JOINT VENTURE COMPANY

The Board is pleased to announce that on 10 October 2013, Fujian Minxin, Fujian Huaxing, Citichamp, Fujian Zhanglong, Fujian Sangang, Fujian Jiasheng, Longyan Huasheng, Longyan Property Right Exchange Centre, Chen Yongxiang, Wang Lixin and Xie Liangliang entered into the JV Agreement for the establishment of the JV Company. The JV Company will be principally engaged in the provision of micro credit and entrusted loans to small and medium enterprises in Changtai, Zhangzhou City, Fujian Province. The JV Company will be accounted for as an available-for-sale financial asset in the financial statement of Fujian Minxin and the consolidated financial statements of the Group respectively.

Fujian Minxin is a wholly-owned subsidiary of the Company. Fujian Huaxing is a wholly-owned subsidiary of FIDG. As FIDG is a substantial shareholder of the Company holding approximately 48.01% interest in the Shares, Fujian Huaxing is an associate of FIDG and a connected person of the Company under the Listing Rules. The entering into of the JV Agreement constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules accordingly.

As one or more of the applicable percentage ratios in respect of the JV Agreement is more than 0.1% but less than 5%, the JV Agreement is subject to the reporting and announcement requirements but exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.

ESTABLISHMENT OF MINXIN MICRO CREDIT

On 23 September 2013, the Company obtained official approval granted by the Fujian Provincial Economic and Trade Commission for the establishment of Minxin Micro Credit, which will be principally engaged in the provision of micro credit and entrusted loans to small and medium enterprises in Sanming Ecological Region of Industry and Trade (三明生態工貿區), Sanming, Fujian Province. The establishment of Minxin Micro Credit is subject to further approval by the Fujian Provincial Department of Foreign Trade & Economic Cooperation.

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(I) FORMATION OF JOINT VENTURE COMPANY

The Board is pleased to announce that on 10 October 2013, Fujian Minxin, Fujian Huaxing, Citichamp, Fujian Zhanglong, Fujian Sangang, Fujian Jiasheng, Longyan Huasheng, Longyan Property Right Exchange Centre, Chen Yongxiang, Wang Lixin and Xie Liangliang entered into the JV Agreement for the establishment of the JV Company. The JV Company will be principally engaged in the provision of micro credit and entrusted loans to small and medium enterprises in Changtai, Zhangzhou City, Fujian Province. A summary of the principal terms of the JV Agreement is set out below.

Date

10 October 2013

Parties

• (1) Fujian Huaxing;

• (2) Citichamp;

• (3) Fujian Zhanglong;

• (4) Fujian Sangang;

• (5) Fujian Minxin;

• (6) Fujian Jiasheng;

• (7) Longyan Huasheng;

• (8) Longyan Property Right Exchange Centre;

• (9) Chen Yongxiang;

• (10) Wang Lixin; and

• (11) Xie Liangliang.

The Directors (including the independent non-executive Directors) confirm that, to the best of their knowledge, information and belief having made all reasonable enquiry, Citichamp, Fujian Zhanglong, Fujian Sangang, Fujian Jiasheng, Longyan Huasheng, Longyan Property Right Exchange Centre, their respective ultimate beneficial owners, Chen Yongxiang, Wang Lixin and Xie Liangliang are Independent Third Parties and are independent of the Company and its connected persons.

The joint venture parties had agreed to set up a preparatory committee for the preparation of all necessary documents for the establishment of the JV Company, including but not limited to those required for the application for approval by Fujian Provincial Economic and Trade Commission.

Scope of Business

The JV Company will be principally engaged in the provision of micro credit and entrusted loans to small and medium enterprises in Changtai, Zhangzhou City, Fujian Province. The JV Company will be accounted for as an available-for-sale financial asset in the financial statement of Fujian Minxin and the consolidated financial statements of the Group respectively.

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Registered Capital and Shareholdings

The registered capital of the JV Company shall be RMB150,000,000 (equivalent to approximately HK$189,960,000) divided into 150,000,000 shares with face value of RMB1 each, which shall be contributed by the joint venture parties in cash within 10 days upon receipt of approval from the Fujian Provincial Economic and Trade Commission for the establishment of the JV Company in the following proportions:

Joint venture	Amount of contribution to	Amount of contribution to	Number of	Percentage of
party	registered capital		shares of	interest
		Approximate	the JV	in the JV
	RMB (‘000)	HK$ equivalent (‘000)	Company (‘000)	Company
Fujian Huaxing	44,000	55,722	44,000	29.33%
Fujian Minxin	15,000	18,996	15,000	10.00%
Other joint
venture	91,000	115,242	91,000	60.67%
parties

The joint venture parties shall pay a deposit equivalent to 10% of their respective contribution to the registered capital of the JV Company to Fujian Huaxing in cash within 5 business days upon entering into the JV Agreement. The deposit will be refunded to the joint venture parties within 3 business days upon the receipt of contribution to the registered capital of the JV Company.

The deposit and the contribution to the registered capital of the JV Company payable by Fujian Minxin will be funded by the internal resources of Fujian Minxin.

Board Composition

The board of directors of the JV Company shall be composed of nine directors, among which two directors shall be nominated by Fujian Huaxing and seven directors shall be nominated by the other joint venture parties. Each shareholder holding 5% or more registered capital in the JV Company may nominate one director to be elected at the general meeting of the shareholders. The chairman of the board of directors of the JV Company (who shall also be the legal representative of the JV Company) shall be nominated by Fujian Huaxing. The directors shall have a term of office for three years and may be re-elected upon expiry of the term. Fujian Minxin has the right to nominate one director to be elected at the general meeting of the shareholders.

Transfer of Registered Capital

Fujian Huaxing shall not transfer its interests in the registered capital of the JV Company within 3 years after the establishment of the JV Company. The other joint venture parties shall not transfer their respective interests in the registered capital of the JV Company within 2 years after the establishment of the JV Company. Directors and senior management of the JV Company shall not transfer their respective interests in the registered capital of the JV Company during their term of office.

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Each shareholder in the JV Company may transfer its interests in the registered capital of the JV Company to other shareholders in the JV Company by notifying the other shareholders in writing under the condition that the total number of shareholders shall not be less than eight after such transfer.

Any transfer of interests in the registered capital of the JV Company to third parties who are not shareholders of the JV Company shall require the approval of at least 50% of the shareholders of the JV Company at the general meeting. Any shareholder of the JV Company who raises objection to the aforementioned transfer of interests in the registered capital of the JV Company shall acquire such interests, or otherwise be deemed to consent to the proposed transfer. Shareholders of the JV Company shall have priority to acquire any interests in the registered capital on the same terms offered to third parties who are not shareholders (except where interests are offered to related parties recognised at a general meeting of the shareholders) in proportion to their shareholding in the JV Company or as otherwise agreed by such shareholders.

Approvals Required for the Establishment of the JV Company

The establishment of the JV Company is subject to approval by the Fujian Provincial Economic and Trade Commission and the Fujian Provincial Department of Foreign Trade & Economic Cooperation.

Reasons for and Benefits of Entering into the JV Agreement

The Company is an investment holding company and the Group’s principal business activities include banking investment in the PRC and Macao. Fujian Minxin is an investment company established in the PRC. The Group is actively exploring opportunities to expand its investment in financial services sector in the PRC. The Directors (including the independent non-executive Directors) believe that the entering into of the JV Agreement and the establishment of the JV Company is in line with the investment strategy of the Group and Fujian Minxin and would have synergy effect on the business development of the Group as a whole in the long term.

The Directors (including the independent non-executive Directors) are of the view that the formation of the JV Company is in the usual and ordinary course of business of the Group, and that the terms of the JV Agreement are on normal commercial terms, fair and reasonable and in the interest of the Company and the Shareholders as a whole.

Listing Rules Implications

Fujian Minxin is a wholly-owned subsidiary of the Company. Fujian Huaxing is a wholly-owned subsidiary of FIDG. As FIDG is a substantial shareholder of the Company holding approximately 48.01% interest in the Shares, Fujian Huaxing is an associate of FIDG and a connected person of the Company under the Listing Rules. The entering into of the JV Agreement constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules accordingly.

As one or more of the applicable percentage ratios in respect of the JV Agreement is more than 0.1% but less than 5%, the JV Agreement is subject to the reporting and announcement requirements but exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.

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Mr. Weng Ruo Tong (being Chairman of FIDG) and Mr. Peng Jin Guang (being Vice Chairman and General Manager of FIDG) are regarded as having interests in the transactions under the JV Agreement and have abstained from voting on the resolution of the Board approving the transactions under the JV Agreement.

Shareholders and potential investors of the Company are reminded that the establishment of the JV Company is subject to approval by the Fujian Provincial Economic and Trade Commission and the Fujian Provincial Department of Foreign Trade & Economic Cooperation in the PRC. Accordingly, there is no certainty that the JV Company may be established. Shareholders and public investors are advised to exercise caution when dealing in the shares of the Company.

Information on the Joint Venture Parties

The Group is principally engaged in banking investment, insurance, property development and investment, and investment holdings.

Fujian Huaxing is a diversified financial conglomerate and principally engaged in non-bank financial services in the PRC.

Citichamp is principally engaged in property development and the manufacturing and distribution of enamelled wire in the PRC.

Fujian Zhanglong is principally engaged in operation and management of state-owned assets of Zhangzhou City, and import and export trading in the PRC.

Fujian Sangang is principally engaged in the manufacturing and distribution of steel products and chemical fertilizer in the PRC.

Fujian Jiasheng is principally engaged in the manufacturing and distribution of steel wires, hardware, machinery and equipments in the PRC.

Longyan Huasheng is principally engaged in financial services investment, assets investment and management in the PRC.

Longyan Property Right Exchange Centre is a governmental entity focusing on the trading of property rights in the PRC.

(II) ESTABLISHMENT OF MINXIN MICRO CREDIT

On 23 September 2013, the Company obtained official approval granted by the Fujian Provincial Economic and Trade Commission for the establishment of a wholly-owned subsidiary, Minxin Micro Credit, in Sanyuan District, Sanming, Fujian Province. Minxin Micro Credit will be principally engaged in the provision of micro credit and entrusted loans to small and medium enterprises in Sanming Ecological Region of Industry and Trade (三明生態工貿區), Sanming, Fujian Province. The registered capital of Minxin Micro Credit is RMB300 million, to be contributed by the Company on the date of establishment of Minxin Micro Credit. The term of business is 20 years from the date of issue of the business licence of Minxin Micro Credit. The establishment of Minxin Micro Credit is subject to further approval by the Fujian Provincial Department of Foreign Trade & Economic Cooperation.

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The Group is actively exploring opportunities to expand its investment in financial services sector in the PRC. The Directors (including the independent non-executive Directors) believe that the proposed establishment of Minxin Micro Credit would provide the Group with a good opportunity to expand its investment horizon and strengthen its financial services business, and would have synergy effect on the business development of the Group in the long term. With the rapid growth of the economy in the PRC, the Group believes that the demand for the micro credit business will continue to grow and there will be business opportunities for the Group in this area.

Shareholders and potential investors of the Company are reminded that the establishment of Minxin Micro Credit is subject to further approval by the Fujian Provincial Department of Foreign Trade & Economic Cooperation. Accordingly, there is no certainty that Minxin Micro Credit may be established. Shareholders and public investors are advised to exercise caution when dealing in the shares of the Company.

DEFINITIONS

In this announcement, the following expressions have the meanings set out below unless the context requires otherwise:

“Board”	the board of Directors
“Chen Yongxiang”	陳永祥, an individual and Independent Third Party
“Citichamp”	冠城大通股份有限公司(Citichamp Dartong Co., Ltd.*), a company
	established in the PRC and an Independent Third Party, the shares of
	which are listed on the Shanghai Stock Exchange (Stock Code: 600067)
“Company”	Min Xin Holdings Limited (Stock Code: 222), a company incorporated in
	Hong Kong with limited liability, the shares of which are listed on the
	Main Board of the Stock Exchange
“Director(s)”	the director(s) of the Company
“FIDG”	福建省投資開發集團有限責任公司(Fujian Investment & Development
	Group Co., Ltd.), a company established in the PRC and a substantial
	shareholder of the Company
“Fujian Huaxing”	福建省華興集團有限責任公司(Fujian Huaxing Group Co., Ltd.*), a
	company established in the PRC and a wholly-owned subsidiary of FIDG
“Fujian Minxin”	福建閩信投資有限公司(Fujian Minxin Investments Co., Ltd.), a
	company established in the PRC and a wholly-owned subsidiary of the
	Company
“Fujian Jiasheng”	福建嘉勝鋼圈集團有限公司 (Fujian Jiasheng Steel Group Co., Ltd.*), a
	company established in the PRC and an Independent Third Party
“Fujian Sangang”	福建省三鋼（集團）有限責任公司(Fujian Sangang (Group) Co., Ltd.*),
	a company established in the PRC and an Independent Third Party

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“Fujian Zhanglong”		福建漳龍實業有限公司(Fujian Zhanglong Industrial Co., Ltd.*), a
		company established in the PRC and an Independent Third Party
“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	an independent third party not connected with any of the Directors, chief
Party”		executive or substantial shareholders of the Company or any of its
		subsidiaries or their respective associates
“JV Agreement”		the joint venture agreement dated 10 October 2013 entered into amongst
		Fujian Huaxing, Citichamp, Fujian Zhanglong, Fujian Sangang, Fujian
		Minxin, Fujian Jiasheng, Longyan Huasheng, Longyan Property Rights
		Exchange Centre, Chen Yongxiang, Wang Lixin and Xie Liangliang in
		relation to the establishment of the JV Company
“JV Company”		福建長泰縣華興小額貸款股份有限公司(Fujian Changtai Huaxing
		Micro Credit Co., Ltd.*), a joint stock limited liability company to be
		established in the PRC pursuant to the JV Agreement
“Listing Rules”		the Rules Governing the Listing of Securities on the Main Board of the
		Stock Exchange
“Longyan Huasheng”		龍岩市華盛企業投資有限公司(Longyan Huasheng Enterprise
		Investment Co., Ltd.*), a company established in the PRC and an
		Independent Third Party
“Longyan Property	Right	龍岩市産權交易中心(Longyan Property Right Exchange Centre*), a
Exchange Centre”		governmental entity established in the PRC and an Independent Third
		Party
“Macao”		the Macao Special Administrative Region of the PRC
“Minxin Micro Credit”		三明市三元區閩信小額貸款有限公司(Sanming Sanyuan District
		Minxin Micro Credit Company Limited), a limited company to be
		established in the PRC as a wholly-owned subsidiary of the Company
“PRC”		the People’s Republic of China, which for the purpose of this
		announcement excludes Hong Kong, Macao and Taiwan

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“RMB” Renminbi, the lawful currency of the PRC “Share(s)” ordinary share(s) of HK$1 each in the share capital of the Company “Shareholder(s)” holder(s) of the Share(s) “Stock Exchange” The Stock Exchange of Hong Kong Limited “Wang Lixin” 王麗新, an individual and Independent Third Party “Xie Liangliang” 謝亮亮, an individual and Independent Third Party “%” per cent

By order of the Board Min Xin Holdings Limited Weng Ruo Tong Chairman

Hong Kong, 10 October 2013

As at the date of this announcement, the Executive Directors of the Company are Messrs Weng Ruo Tong (Chairman), Peng Jin Guang (Vice Chairman), Li Jin Hua and Zhang Rong Hui; the Non-Executive Director is Mr Liu Cheng; and the Independent Non-Executive Directors are Messrs Ip Kai Ming, Sze Robert Tsai To and So Hop Shing.

Translation of Renminbi into Hong Kong dollars in this announcement is based on the exchange rate of RMB1.00 = HK$1.2664. Such exchange rate is for the purpose of illustration only and does not constitute a representation that any amount in RMB has been, could have been or may be converted at such or any other rate at all.

* the relevant English name is only a transliteration of the Chinese name for reference only.

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