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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Zhejiang Expressway Co | LSE:ZHEH | London | Ordinary Share | CNE1000004S4 | 'H' CNY1 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 92.1998 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMZHEH
Connected Transaction Asset Management Agreements
Hong Kong Stock 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.
ZHEJIANG EXPRESSWAY CO. LTD
(A joint stock limited company incorporated in the People's Republic of China
with limited liability)
(Stock code: 0576)
CONNECTED TRANSACTION
ASSET MANAGEMENT AGREEMENTS
THE ASSET MANAGEMENT AGREEMENTS
On 20 September 2016, Zheshang Securities AM, an indirect non wholly-owned
subsidiary of the Company, entered into the Asset Management Agreement I with
Zhejiang Communications Finance, a subsidiary of the controlling shareholder of
the Company, pursuant to which Zheshang Securities AM agreed to sell 69,000,000
units (equivalent to RMB69,000,000) of the Specific Asset Management Scheme to
Zhejiang Communications Finance . The Asset Management Agreement I was
terminated on 1 March 2017.
On 18 August 2017, Zheshang Securities AM entered into the Asset Management
Agreement II with Zhejiang Communications Finance, pursuant to which Zheshang
Securities AM agreed to sell 100,000,000 units (equivalent to RMB100,000,000)
of the Collective Asset Management Scheme to Zhejiang Communications Finance.
LISTING RULES IMPLICATIONS
Communications Group is a controlling shareholder of the Company. Zhejiang
Communications Finance is a non wholly-owned subsidiary of Communication Group.
Therefore, Zhejiang Communications Finance is a connected person of the Company
and as a result, the transactions under the Asset Management Agreements
constitute connected transactions for the Company under Chapter 14A of the
Listing Rules.
As the applicable percentage ratios in respect of the transactions contemplated
under the Asset Management Agreement I are more than 0.1% but less than 5%, the
Asset Management Agreement I is subject to the reporting, announcement and
annual review requirements but exempt from the independent Shareholders'
approval requirement under Chapter 14A of the Listing Rules.
As the applicable percentage ratios in respect of the transactions contemplated
under the Asset Management Agreement II are more than 0.1% but less than 5%,
the Asset Management Agreement II is subject to the reporting, announcement and
annual review requirements but exempt from the independent Shareholders'
approval requirement under Chapter 14A of the Listing Rules.
Although the Asset Management Agreement I and the Asset Management Agreement II
are entered into by the Group with the same party within a 12-month period and
are similar in nature, no aggregation in accordance with Rule 14A.81 of the
Listing Rules is required as the Asset Management Agreement I was terminated on
1 March 2017.
THE ASSET MANAGEMENT AGREEMENT I
Principal terms of the Asset Management Agreement I are set out below:
Date: 20 September 2016
Parties: (1) Zhejiang Communications Finance, as the
principal;
(2) Zheshang Securities AM, as the manager; and
(3) Everbright Bank Hangzhou Branch, as the
custodian
Asset Management Scheme "Zheshang Juyin No.1 Connection Interaction Stocks
Income Rights No.3" Specific Asset Management
Scheme
Term: 6 months
Investment amount/entrusted RMB69,000,000 (69,000,000 units)
assets:
Investment scope: Invest in the target stock income rights held by
the financing party.
Benchmark rate of returns: 5.5% per annum
Fees: (1) Management fee: 0.3% per annum of the net
value of entrusted assets as at the establishment
date of the Specific Asset Management Scheme.
(2) Performance fee: the manager is entitled to
collect all the returns in excess of the benchmark
rate of returns as the performance fee at the
expiration date of the Specific Asset Management
Scheme.
Governing law: PRC law
Withdrawal of entrusted The principal is not entitled to withdraw its
assets: entrusted assets during the term of the Specific
Asset Management Scheme.
On 1 March 2017, the financing party repurchased all of the stock income rights
before the expiration of the Specific Asset Management Scheme in accordance
with the Asset Management Agreement I. As a result, the Specific Asset
Management Scheme was terminated on the same date.
Due to the inadvertence of the management, the Asset Management Agreement I was
discovered only during the review process of the Asset Management Agreement II.
As the applic able p erce ntage ratios (other than the pro fits ra tio) in
respe ct of the transactions contemplated under the Asset Management Agreement
I are more than 0.1% but less than 5%, thus, such transaction is subject to the
reporting, annual review and announcement requirements, but exempt from
independent shareholders' approval requirements.
Failure to disclose this transaction constitutes a breach of the Listing Rules.
The Company will take steps to strengthen its internal control measures in
relation to the monitoring connected transactions going forward, in order to
avoid repeating similar breach. In this regard, the Company will seek external
legal advice on the relevant requirements under the Listing Rules and review
the internal communication and reporting system and practice with the relevant
departments and staff, particularly over the reporting of potential connected
transactions.
THE ASSET MANAGEMENT AGREEMENT II
Principal terms of the Asset Management Agreement II are set out below:
Date: 18 August 2017
Parties: (1) Zhejiang Communications
Finance, as the principal;
(2) Zheshang Securities AM, as the
manager; and
(3) Everbright Bank, as the
custodian
Asset Management Scheme "Zheshang Huijin Enhanced Earnings"
Collective Asset Management Scheme
Term: No fixed term
Investment amount/entrusted assets: RMB100,000,000 (100,000,000 units)
Investment scope: Mainly invest in the following financial
products legally issued within the PRC:
(i) bonds; (ii) repurchase of pledged
stocks; (iii) commercial banks'
financial management plans with
guaranteed proceeds or with guaranteed
principal but floating proceeds; (iv)
cash; (v) bank deposit; (vi) money
market fund; (vii) reverse repurchase of
bonds; (viii) repurchase of bonds; (ix)
inter-bank deposit certificates; (x)
negotiable certificates of deposits.
Benchmark rate of returns: Benchmark rate of returns for the period
will be announced before the redemption
date of the corresponding period
Fees: (1) Management fee: 0.6% per annum of
the net value of entrusted assets. The
management fee is calculated and accrued
daily.
(2) Performance fee: the manager is
entitled to collect the funds no more
than the balance of the risk reserve
capital (as calculated in the agreement)
as the performance fee every quarter.
Governing law: PRC law
Withdrawal of entrusted assets: Open to redemption on the Monday and
Tuesday of the second week of each month
after a closed period of two months
REASONS FOR AND BENEFITS OF THE TRANSACTIONS
Asset management is the major business of Zheshang Securities AM. The income
generated from asset management has been increased steadily in the past few
years. By entering into the Asset Management Agreements, Zheshang Securities AM
is able to expand its asset management business and earn the management fees
and performance fees, thus beneficial to the Company and Shareholders as a
whole. Further, Zhejiang Communications Finance is able to increase its capital
gain of idle funds and manage the Communications Group's capital effectively,
as such improving the synergy of the Company and Communications Group.
The Group has internal control measures to ensure that the connected
transactions contemplated under the Asset Management Agreements are in
accordance with the investment policies and the terms and conditions of the
agreement, and that the terms and conditions of the Asset Management Agreements
are no less favourable than those terms offered to the independent third
parties for similar services.
Given the above, the Directors (including the independent non-executive
Directors) are of the view that the terms of the Assets Management Agreements
are on normal commercial terms, in the ordinary and usual course of business of
the Company and are fair and reasonable and in the interests of the Company and
the Shareholders as a whole.
LISTING RULES IMPLICATIONS
Communications Group is a controlling shareholder of the Company. Zhejiang
Communications Finance is a non wholly-owned subsidiary of Communications
Group. Therefore, Zhejiang Communications Finance is a connected person of the
Company and as a result, the transactions under the Asset Management Agreements
constitutes connected transactions for the Company under Chapter 14A of the
Listing Rules.
As the applicable percentage ratios in respect of the transactions contemplated
under the Asset Management Agreement I are more than 0.1% but less than 5%, the
Asset Management Agreement I is subject to the reporting, announcement and
annual review requirements but exempt from the independent Shareholders'
approval requirement under Chapter 14A of the Listing Rules.
As the applicable percentage ratios in respect of the transactions contemplated
under the Asset Management Agreement II are more than 0.1% but less than 5%,
the Asset Management Agreement II is subject to the reporting, announcement and
annual review requirements but exempt from the independent Shareholders'
approval requirement under Chapter 14A of the Listing Rules.
Although the Asset Management Agreement I and the Asset Management Agreement II
are entered into by the Group with the same party within a 12-month period and
are similar in nature, no aggregation in accordance with Rule 14A.81 of the
Listing Rules is required as the Asset Management Agreement I was terminated on
1 March 2017.
INFORMATION ON THE PARTIES
The Company is a joint stock company established under the laws of the PRC with
limited liability on 1 March 1997, the H Shares of which are listed on the Main
Board of the Stock Exchange. It is principally engaged in investing in,
developing and operating high-grade roads in the PRC. The Group also carries on
certain other businesses such as securities brokerage, investment banking,
asset management and margin financing through Zheshang Securities.
Zheshang Securities AM is an indirect non wholly-owned subsidiary of the
Company which is incorporated under the laws of the PRC on 18 April 2013.
Zheshang Securities AM is principally engaged in securities asset management
and public securities investment funds management.
Zhejiang Communications Finance is a controlling subsidiary of Communications
Group which is incorporated under the laws of the PRC on 9 November 2012 and
approved by CBRC as a non-banking financial institution on 17 October 2012. As
at the date of this announcement, Zhejiang Communications Finance is owned as
to 40% and 35% by Communications Group and the Company, respectively, and
Zhejiang Communications Finance is an associate of the Company. Zhejiang
Communications Finance is principally engaged in the business of providing
financial services to the subsidiaries of Communications Group, including but
not limited to advising the subsidiaries of Communications Group in relation to
financing, letters of credit and other agency services; authorised insurance
agency businesses; providing guarantees, accepting and discounting commercial
notes, arranging for loans and financial leases, and receiving deposits of the
subsidiaries of Communications Group.
DEFINITIONS
In this announcement, unless the context specifies otherwise, the following
defined expressions have the following meanings:
"Asset Management Agreements" collectively, Asset Management Agreement I
and Asset Management Agreement II
"Asset Management Agreement I" the agreement dated 20 September 2016 entered
into between Zheshang Securities AM, Zhejiang
Communications Finance and Everbright Bank
Hangzhou Branch in relation to the Specific
Asset Management Scheme in the amount of
RMB69,000,000
"Asset Management Agreement II" the agreement dated 18 August 2017 entered
into am ong Zhes han g Se curi tie s A M,
Z hej iang Communications Finance and
Everbright Bank in relation to the Collective
Asset Management Scheme in the amount of
RMB100,000,000
"Asset Management Schemes" collectively, Collective Asset Management
Scheme and Specific Asset Management Scheme
"associate" has the meaning ascribed to it under the
Listing Rule
"Board" the board of Directors
"CBRC" China Banking Regulatory Commission of the
PRC
"Collective Asset Management "Zheshang Huijin Enhanced Earnings"
Scheme" Collective Asset Management Scheme*, an asset
management scheme operated by Zheshang
Securities AM under the Asset Management
Agreement II
"Communications Group" Zhejiang Communications Investment Group Co.,
Ltd.*, a wholly state-owned enterprise
established in the PRC, and the controlling
shareholder of the Company
"Company" Zhejiang Expressway Co., Ltd., a joint
stock limited company incorporated in the
PRC with limited liability
"connected person" has the meaning ascribed to it under the
Listing Rules
"controlling shareholder" has the meaning ascribed to it under the
Listing Rule
"Director(s)" the directors of the Company
"Everbright Bank" China Everbright Bank Co., Ltd, the
custodian of the Asset Management
Schemes
"Group" the Company and its subsidiaries
"H Shares" overseas listed foreign shares in the share
capital of the Company with a nominal value
of RMB1 per share, which are listed on the
Main Board of the Stock Exchange
"Hong Kong" the Hong Kong Special Administrative Region
of the PRC
"Listing Rules" Rules Governing the Listing of Securities on
The Stock Exchange of Hong Kong Limited
"percentage ratio" has the meaning ascribed to it under Rule
14.04(9) of the Listing Rules
"PRC" the People's Republic of China (for the
purpose of this announcement, excludes Hong
Kong, Macau and Taiwan)
"RMB" Renminbi, the lawful currency of the PRC
"Shareholder(s)" holder(s) of the share(s) of the Company
"Specific Asset Management "Zheshang Juyin No.1 Connection Interaction
Scheme" Stocks Income Rights No.3" Specific Asset
Management Scheme*, an asset management
scheme operated by Zheshang Securities AM
under the Asset Management Agreement I
"Stock Exchange" The Stock Exchange of Hong Kong Limited
"subsidiary(ies) has the meaning ascribed to it under the
" Listing Rules
"%" per cent.
"Zhejiang Communications Finance" Zhejiang Communications Investment Group
Finance Co., Ltd.*, a limited liability
company incorporated in the PRC and owned as
to 40% and 35% by Communications Group and
the Company, respectively, as at the date of
this announcement.
"Zheshang Securities" Zhejiang Zheshang Securities Co., Ltd., a
limited liability company incorporated in the
PRC and a direct non wholly-owned subsidiary
of the Company
"Zheshang Securities AM" Zhejiang Zheshang Securities Asset Management
Co.,Ltd.*, a limited liability company
incorporated in the PRC and an indirect non
wholly-owned subsidiary of the Company
* English names for reference only
On behalf of the Board
ZHEJIANG EXPRESSWAY CO., LTD.
ZHAN Xiaozhang
Chairman
Hangzhou, the PRC, 18 August 2017
As at the date of this announcement, the executive directors of the Company are: Mr. ZHAN Xiaozhang, Mr. CHENG Tao and Ms. LUO Jianhu; the non-executive directors of the Company are: Mr. WANG Dongjie, Mr. DAI Benmeng, and Mr. ZHOU Jianping; and the independent non-executive directors of the Company are: Mr. ZHOU Jun, Mr. PEI Ker-Wei and Ms. LEE Wai Tsang, Rosa. END
(END) Dow Jones Newswires
August 18, 2017 07:57 ET (11:57 GMT)
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