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.

ANNOUNCEMENT CONTINUING CONNECTED TRANSACTION ENTERING INTO FACTORING COOPERATION AGREEMENT WITH CHINALCO FACTORING

Reference is made to the announcement of the Company dated 17 August 2017, in relation to proposed development of factoring business in respect of accounts receivable by the Company with Chinalco Factoring.

On 27 September 2017, the Company entered into the Factoring Cooperation Agreement with Chinalco Factoring, pursuant to which Chinalco Factoring has agreed to provide factoring financing services to the Company in accordance with the terms and conditions set out therein, for a period commencing from the date when the Factoring Cooperation Agreement takes effect and expiring on 31 December 2018.

As at the date of this announcement, Chinalco Factoring is a subsidiary of Chinalco, the controlling Shareholder of the Company, and thus is a connected person of the Company under the Hong Kong Listing Rules. As a result, this transaction constitutes a continuing connected transaction of the Company under Chapter 14A of the Hong Kong Listing Rules. As the highest applicable percentage ratio (as defined under the Hong Kong Listing Rules) in respect of the entering into of the Factoring Cooperation Agreement and the determination of the annual caps thereunder exceeds 0.1% but is less than 5%, the Factoring Cooperation Agreement and the annual caps thereunder are subject to reporting and announcement requirements but exempt from independent shareholder's approval requirement under Chapter 14A of the Hong Kong Listing Rules.

  1. INTRODUCTION

    Reference is made to the announcement of the Company dated 17 August 2017, in relation to proposed development of factoring business in respect of accounts receivable by the Company with Chinalco Factoring.

    On 27 September 2017, the Company entered into the Factoring Cooperation Agreement with Chinalco Factoring, pursuant to which Chinalco Factoring has agreed to provide factoring financing services to the Company in accordance with the terms and conditions set out therein, for a period commencing from the date when the Factoring Cooperation Agreement takes effect and expiring on 31 December 2018.

  2. FACTORING COOPERATION AGREEMENT
    1. Date

      27 September 2017

    2. Parties

      1. the Company, as the recipient; and

      2. Chinalco Factoring, as the provider.

      3. Term

        Commencing from the date when the Factoring Cooperation Agreement takes effect and expiring on 31 December 2018.

      4. Conditions Precedent

        The Factoring Cooperation Agreement and the transactions thereunder shall take effect upon being approved by competent governing bodies of the parties thereto and signed and sealed by the authorized representatives of the parties thereto.

      5. Factoring Services

        Chinalco Factoring has agreed to provide factoring financing services to the Company in accordance with the terms and conditions of the Factoring Cooperation Agreement.

        Subject to the Factoring Cooperation Agreement, the Company shall enter into specific contracts or agreements for such specific factoring services to specify the terms of relevant transactions. Those specific contracts or agreements must be in line with the principles and terms of the Factoring Cooperation Agreement and the relevant laws and regulations. The Company and Chinalco Factoring shall design a payment method on a flexible basis according to the specific factoring services.

      6. Annual Caps

        Within the term of the Factoring Cooperation Agreement, the annual cap for the transactions between the Company and Chinalco Factoring for both 2017 and 2018 is RMB1.3 billion.

        The above annual caps are determined after taking into account (i) the demand of the Group for accounts receivable financing services; (ii) the Group's historical revenue and settlement of the accounts receivable for the year ended 31 December 2016; and (iii) the amount of the accounts receivable as disclosed in the latest financial statements of the Company.

        There are no past transactions in relation to provision of factoring services by Chinalco Factoring to the Group.

      7. Pricing Principles

        The financing costs for the services to be provided by Chinalco Factoring to the Company shall be determined based on fair and reasonable market prices and normal commercial terms, and specifically, shall not be higher than those charged by third-party factoring companies in the PRC for similar services.

      8. REASONS FOR AND BENEFITS OF ENTERING INTO THE FACTORING COOPERATION AGREEMENT

        The Factoring Cooperation Agreement and the transaction contemplated thereunder will help to alleviate capital occupation by accounts receivable, satisfy the funding requirement for business development, support continuous business operation, improve the efficiency of capital utilization and maximize benefits.

        The Directors (including independent non-executive Directors) are of the view that the transaction contemplated under the Factoring Cooperation Agreement is on normal commercial terms, is fair and reasonable and in the interests of the Company and the Shareholders as a whole, but is not in the ordinary or usual course of business of the Group due to the nature of such transaction.

      9. IMPLICATIONS UNDER HONG KONG LISTING RULES

        10. As at the date of this announcement, Chinalco Factoring is a subsidiary of Chinalco, the controlling Shareholder of the Company, and thus is a connected person of the Company under the Hong Kong Listing Rules. As a result, this transaction constitutes a continuing connected transaction of the Company under Chapter 14A of the Hong Kong Listing Rules. As the highest applicable percentage ratio (as defined under the Hong Kong Listing Rules) in respect of the entering into of the Factoring Cooperation Agreement and the determination of the annual caps thereunder exceeds 0.1% but is less than 5%, the Factoring Cooperation Agreement and the annual caps thereunder are subject to reporting and announcement requirements but exempt from independent shareholder's approval requirement under Chapter 14A of the Hong Kong Listing Rules.

        As Mr. Yu Dehui and Mr. Liu Caiming, the Directors of the Company, concurrently hold positions in Chinalco, they have abstained from voting on the Board resolution with respect to the transaction contemplated under the Factoring Cooperation Agreement. Saved as disclosed above, none of the Directors has any material interest in the transaction contemplated under the Factoring Cooperation Agreement and therefore none of the other Directors has abstained from voting on such Board resolution.

      CHINALCO - Aluminum Corporation of China Ltd. published this content on 27 September 2017 and is solely responsible for the information contained herein.
      Distributed by Public, unedited and unaltered, on 27 September 2017 13:14:10 UTC.

      Original documenthttp://www.chalco.com.cn/chalcoen/rootfiles/2017/09/27/1506471873225774-1506471873227692.pdf

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