ANHUI CONCH CEMENT COMPANY LIMITED Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this joint 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 joint announcement.
This joint announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for the securities of West China Cement nor shall there be any sale, purchase or subscription for securities of West China Cement in any jurisdiction in which such offer, solicitation or sale would be unlawful absent the filing of a registration statement or the availability of an applicable exemption from registration or other waiver. This joint announcement is not for release, publication or distribution in or into any jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction.
CONCH INTERNATIONAL HOLDINGS (HK) LIMITED
海 螺 國 際 控 股 ( 香 港 ) 有 限 公 司
(Incorporated in Hong Kong with limited liability)
ANHUI CONCH CEMENT COMPANY LIMITED
安 徽 海 螺 水 泥 股 份 有 限 公 司
(A joint stock limited company incorporated in the People's Republic of China)
WEST CHINA CEMENT LIMITED
中 國 西 部 水 泥 有 限 公 司
(Incorporated in Jersey with limited liability, with registered number 94796)
(Stock Code: 914) (Stock Code: 2233)
West China Cement Limited US$400 MILLION 6.50% SENIOR NOTES DUE 2019
(Stock Code: 5800)
JOINT ANNOUNCEMENT
MAJOR AND CONNECTED TRANSACTION OF WEST CHINA CEMENT IN RELATION TO THE ACQUISITION OF TARGET COMPANIES
DISCLOSEABLE TRANSACTION OF CONCH CEMENT IN RELATION TO THE DISPOSAL OF TARGET COMPANIES AND
ACQUISITION OF SHARES IN WEST CHINA CEMENT
POSSIBLE MANDATORY UNCONDITIONAL CASH OFFERS BY
OPTIMA CAPITAL LIMITED FOR AND ON BEHALF OF THE OFFEROR FOR ALL THE ISSUED SECURITIES IN WEST CHINA CEMENT (OTHER THAN THOSE ALREADY OWNED OR AGREED TO BE ACQUIRED BY THE OFFEROR AND PARTIES ACTING IN CONCERT WITH IT AND THOSE HELD BY PERSONS WHO AGREED
TO EXECUTE LETTERS OF UNDERTAKING)
PROPOSED GRANT OF SPECIFIC MANDATE OF WEST CHINA CEMENT TO ALLOT AND ISSUE THE CONSIDERATION SHARES
ESTABLISHMENT OF INDEPENDENT BOARD COMMITTEES OF WEST CHINA CEMENT AND
RESUMPTION OF TRADING IN THE SHARES OF WEST CHINA CEMENT
Financial adviser to the Offeror and Conch Cement Financial adviser to West China Cement
THE TRANSACTION
The West China Cement Board and the Conch Cement Board are pleased to jointly announce that on 27 November 2015, Grand Winner, West China Cement and Conch Cement entered into an Acquisition Agreement, pursuant to which Grand Winner has conditionally agreed to acquire or procure its wholly-owned subsidiary to acquire, and Conch Cement has conditionally agreed to sell, the entire equity interests in each of (i) Baoji FHS at the consideration of HK$1,465,434,792, (ii) Baoji JLH at the consideration of HK$698,575,918, (iii) Qianxian Cement at the consideration of HK$1,314,287,866, and
(iv) Qianyang Cement at the consideration of HK$1,115,584,024, the aggregate consideration of the Target Companies being HK$4,593,882,600 shall be satisfied by the issue of 3,402,876,000 Consideration Shares by West China Cement at the Issue Price of HK$1.35 per Consideration Share.
Upon the Acquisition Completion and taking into account the 1,147,565,970 Shares held by Conch International as at the date of this joint announcement, the Offeror and parties acting in concert with it will be interested in an aggregate of 4,550,441,970 Shares, representing approximately 51.57% (assuming no outstanding Share Options having been exercised), approximately 51.00% (assuming all in-the-money Share Options based on the Share Offer Price having been exercised) and approximately 50.97% (assuming all the outstanding Share Options having been exercised) of the enlarged issued share capital of West China Cement. West China Cement will become an indirect non-wholly owned subsidiary of Conch Cement, and Asia Gain will cease to be the controlling shareholder of West China Cement.
The Consideration Shares will be issued by West China Cement under the Specific Mandate. An application will be made by West China Cement to the Stock Exchange for the listing of, and permission to deal in, the Consideration Shares.
IMPLICATIONS UNDER THE LISTING RULES
For West China Cement
As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Transaction exceeds 25% but all are less than 100% for West China Cement, the Transaction constitutes a major transaction of West China Cement under Chapter 14 of the Listing Rules.
As of the date of this joint announcement, Conch International, a wholly-owned subsidiary of Conch Cement, is a substantial shareholder of West China Cement. Accordingly, Conch Cement and Conch International are connected persons of West China Cement pursuant to Rule 14A.07 of the Listing Rules. Accordingly, the Transaction constitutes a connected transaction for West China Cement and is subject to the reporting, announcement and Independent Shareholders' approval requirements under the Listing Rules.
For Conch Cement
As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Transaction and the acquisition of the Consideration Shares in West China Cement together with the Offers, on a standalone basis or when aggregated with the previous subscription and acquisition of Shares, exceeds 5% but all are less than 25% for Conch Cement, the Transaction and the Offers together constitutes a discloseable transaction of Conch Cement under Chapter 14 of the Listing Rules and is subject to the reporting and announcement requirements under the Listing Rules.
POSSIBLE MANDATORY UNCONDITIONAL CASH OFFERS
As at the date of this joint announcement, the Offeror and parties acting in concert with it are interested in 1,147,565,970 Shares, representing approximately 21.17% of the total issued share capital of West China Cement. Upon the Acquisition Completion, the Offeror and parties acting in concert with it will be interested in 4,550,441,970 Shares, representing approximately 51.57% (assuming no outstanding Share Options having been exercised), approximately 51.00% (assuming all in-the-money Share Options based on the Share Offer Price having been exercised) and approximately 50.97% (assuming all the outstanding Share Options having been exercised) of the enlarged issued share capital of West China Cement. Subject to the Acquisition Completion, the Offeror will therefore be required under Rule 26.1 of the Takeovers Code to make mandatory unconditional cash offers for all the issued securities of West China Cement which are not already owned or agreed to be acquired by it and parties acting in concert with it.
The Offers, which comprise the Share Offer and the Option Offer, will be unconditional in all respects when made.
Subject to the Acquisition Completion, Optima Capital will, on behalf of the Offeror and in compliance with the Takeovers Code, make the Offers on the following basis:
The Share Offer
For each Offer Share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HK$1.69 in cash
The Share Offer Price of HK$1.69 per Offer Share is the same as the subscription price of 903,467,970 Shares allotted and issued to Conch International on 26 June 2015 (as disclosed in the announcements of West China Cement dated 18 June 2015 and 26 June 2015). Pursuant to Rule 26.3 of the Takeovers Code, the Share Offer Price is the highest price paid by the Offeror and parties acting in concert with it for the Shares of West China Cement within 6 months prior to the commencement of the offer period (as defined in the Takeovers Code).
The Option Offer
For cancellation of each Share Option with
an exercise price of HK$1.25 per Option Share . . . . . . . . . . . HK$0.44 in cash
For cancellation of each Share Option with
an exercise price of HK$0.91 per Option Share . . . . . . . . . . . HK$0.78 in cash
For cancellation of each Share Option with
an exercise price of HK$1.45 per Option Share . . . . . . . . . . . HK$0.24 in cash
For cancellation of each Share Option with
an exercise price of HK$3.41 per Option Share . . . . . . . . . HK$1.00 in cash for
Share Options carrying rights to subscribe for 25,000 Shares
Pursuant to Rule 13 and Practice Note 6 of the Takeovers Code, the Option Offer Price will normally represent the difference between the exercise price of the respective Share Options and the Share Offer Price. Under the Option Offer, the Option Offer Price for each Share Option with an exercise price of HK$1.25, HK$0.91 or HK$1.45 per Option Share represents the difference between the Share Offer Price and the exercise price of these Share Options.
For the Share Options granted by West China Cement on 23 March 2011 with an exercise price of HK$3.41 per Option Share, as the exercise price is higher than the Share Offer Price, the ''see through'' price is therefore zero. Accordingly, the Option Offer with respect to these Share Options will be made at a nominal price of HK$1.00 for Share Options carrying rights to subscribe for 25,000 Shares.
Optima Capital, the financial adviser to the Offeror in respect of the Offers, is satisfied that sufficient financial resources are available to the Offeror to satisfy full acceptance of the Offers.
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