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(incorporated in Bermuda with limited liability)

(Stock Code: 899) DISCLOSEABLE TRANSACTION IN RELATION TO THE ACQUISITION OF 100% EQUITY INTEREST IN SHAANXI TIANDI ZHONGLI ENERGY DEVELOPMENT COMPANY LIMITED# SALE AND PURCHASE AGREEMENT

The Board is pleased to announce that on 29 June 2016 (after trading hours of the Stock Exchange), the Purchaser, being an indirect wholly-owned subsidiary of the Company, entered into the Sale and Purchase Agreement with the Vendors in relation to the Acquisition, pursuant to which the Purchaser has agreed to purchase and the Vendors have agreed to sell 100% equity interest in the Target Company for the consideration of RMB31,200,000 (equivalent to approximately HK$36,816,000).

LISTING RULES IMPLICATIONS

As the applicable percentage ratio (as defined under the Listing Rules) in respect of the Acquisition is more than 5% but less than 25%, the Acquisition constitutes a notifiable transaction on the part of the Company under Chapter 14 of the Listing Rules.

INTRODUCTION

Reference is made to the announcement of the Company dated 21 December 2015 in relation to, among other matters, the Memorandum of Understanding entered into between the Company and the Vendors regarding the possible acquisition of 100% equity interest in the Target Company.

  • For identification purposes only

    On 29 June 2016 (after trading hours of the Stock Exchange), the Purchaser, being an indirect wholly-owned subsidiary of the Company, entered into the Sale and Purchase Agreement with the Vendors in relation to the Acquisition, pursuant to which the Purchaser has agreed to purchase and the Vendors have agreed to sell 100% equity interest in the Target Company for the consideration of RMB31,200,000 (equivalent to approximately HK$36,816,000).

    The principal terms of the Sale and Purchase Agreement are summarised below.

    SALE AND PURCHASE AGREEMENT

    Date: 29 June 2016

    Parties: (i) the Purchaser;

    1. the Vendor A; and

    2. the Vendor B

    The Vendor A is Ms. 胡惠芳 (transliterated as Hu Huifang#) and the Vendor B is Ms. 石秀蘭 (transliterated as Shi Xiulan#). To the best of the Directors' knowledge, information and belief and having made all reasonable enquiries, each of the Vendors and their respective associates is an Independent Third Party.

    Subject of the Acquisition

    Pursuant to the Sale and Purchase Agreement, the Purchaser agreed to purchase and the Vendors agreed to sell 100% equity interest in the Target Company.

    As at the date of this announcement, the registered capital of the Target Company amounts to RMB 26,600,000 (equivalent to approximately HK$31,388,000) which has been fully paid-up.

    Consideration

    The Consideration for the Acquisition is RMB31,200,000 (equivalent to approximately HK$36,816,000) and shall be payable by the Purchaser in the following manner:

    1. as to RMB4,680,000 (equivalent to approximately HK$5,522,400) (the "First Tranche Consideration") to be payable within ten (10) Business Days after the opening of bank account(s) (the "Bank Account(s)") by the Vendors with licensed bank(s) in the PRC for the purpose of disposing assets in accordance with the relevant laws and regulations in the PRC;

    2. as to RMB21,840,000 (equivalent to approximately HK$25,771,200) to be payable within ten (10) Business Days from the Completion Date; and

    3. subject to, among other matters, the fulfilment of the Sales Guarantee (as defined below) and all CNG Licence (as defined below) having been obtained, the remaining balance of RMB4,680,000 (equivalent to approximately HK$5,522,400) (the "Final Tranche Consideration") to be payable after the first anniversary of the Completion Date and within ten (10) Business Days from the date on which all the Vendors' obligations in relation to the Sales Guarantee are fulfilled.

    If the Purchaser considers, in its absolute discretion, that there is any apprehensible risk or obligations in relation to default in any agreements or contracts entered into by the Target Company prior to the Completion Date, the Purchaser shall have right to withhold a correspondent amount in the Consideration until such risk is eliminated.

    The Consideration was arrived at after arm's length negotiations between the Purchaser and the Vendors after taking into consideration (i) the reasons for the Acquisition as detailed in the paragraph headed "Reasons for and benefits of the Acquisition" in this announcement; (ii) the current financial position of the Target Company; and (iii) the valuation of 100% equity interest in the Target Company, performed by an independent professional valuer on a market approach, of RMB34,000,000 (equivalent to approximately HK$40,120,000) as at 31 March 2016.

    The Directors (including the independent non-executive Directors) consider that the terms and conditions of the Sale and Purchase Agreement are fair and reasonable and on normal commercial terms and are in the interests of the Company and the Shareholders as a whole.

    The Consideration is intended to be funded by internal resources of the Group.

    Completion

    Completion shall take place on the date on which the industrial and commercial registration in relation to the Acquisition is completed, which shall be within thirty (30) Business Days from the date on which the First Tranche Consideration was paid by the Purchaser to the Vendors, or such later date as may be specified by the Purchaser.

    Upon Completion, the Company will, through the Purchaser, become interested in 100% equity interest in the Target Company.

    Sales Guarantee

    The Vendors guarantee to the Purchaser that, during the three hundred and sixty-five (365) days period (the "Guaranteed Period") commencing from the Completion Date, the volume of liquefied natural gas sold by the liquefied natural gas refuelling station (the "LNG Station") of the Target Company located in Guapo Zhen, Hua Xian, Weinan City, Shaanxi Province, the PRC, shall not be less than 7,040 tonnes (the "Sales Guarantee"). For the avoidance of doubt, if the relevant section of the highway on which the LNG Station located is designated as a restricted zone, the Guaranteed Period shall commence on the date such section of the highway ceased to be a restricted zone. In the event that the Sales Guarantee is not fulfilled, the Purchaser may deduct the whole amount of the Final Tranche Consideration from the amount of the Consideration payable to the Vendors.

    The Purchaser and the Vendors shall, upon the expiry of the Guaranteed Period, procure that an audited report for the volume of liquefied natural gas sold by the LNG Station during the Guaranteed Period be prepared, issued and reported by a qualified auditor.

    CNG Licence

    The Vendors undertake to the Purchaser that they will procure the obtaining of all approval, licence and permit (the "CNG Licence") for carrying out the construction works for converting the LNG Station into a liquefied natural gas and compressed natural gas refuelling station within two hundred and seventy (270) days from the Completion Date. In the event that the CNG Licence is not obtained within two hundred and seventy (270) days from the Completion Date, the Vendors shall pay to the Purchaser a daily fee, being an amount equals to 0.1% of the amount of the Consideration actually paid by the Purchaser.

    Asia Resources Holdings Limited published this content on 29 June 2016 and is solely responsible for the information contained herein.
    Distributed by Public, unedited and unaltered, on 29 June 2016 13:30:04 UTC.

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