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This announcement appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities.



CHANGFENG AXLE (CHINA) COMPANY LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1039) ESTABLISHMENT OF INDEPENDENT BOARD COMMITTEE AND APPOINTMENT OF INDEPENDENT FINANCIAL ADVISER

Reference is made to the announcement dated 10 October 2014 issued by Changfeng Axle (China) Company Limited (the "Company") in relation to, among others, the Subscription, the Acquisition and the Whitewash Waiver (the "Announcement"). Save as defined herein, capitalized terms used in this announcement have the same meanings as defined in the Announcement.
The Board is pleased to announce that the Independent Board Committee comprising Mr. Zhu Weizhou, Dr. Li Xiuqing and Mr. Chong Ching Hei, all being independent non-executive Directors, to make a recommendation to the Independent Shareholders in respect of the Subscription, the Loan, the Acquisition, the Whitewash Waiver and the Specific Mandate has been established in compliance with Rule 14A.41 of the Listing Rules and Rule 2.8 of the Takeovers Code. The Board notes that under Rule
2.8 of the Takeovers Code, an independent board committee established for this purpose should comprise all non-executive Directors who have no direct or indirect interest in the Subscription, the Loan, the Acquisition, the Whitewash Waiver and the Specific Mandate. As disclosed in the Announcement, Ms. Dong Ying, Dorothy, the non-executive Director, is the director of Starr Investments Cayman II, Inc., an associate of Starr Investments Cayman V, Inc., she is therefore considered to have a material interest in the Subscription, the Loan, the Acquisition, the Whitewash Waiver and the Specific Mandate.
Accordingly, she is not offered membership of the Independent Board Committee.
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The Board further announces that Somerley Capital Limited has been appointed (with the approval of the Independent Board Committee) as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in connection with the Subscription, the Loan, the Acquisition, the Whitewash Waiver and the Specific Mandate in accordance with Rule 14A.44 of the Listing Rules and Rule 2.1 of the Takeovers Code.
By Order of the Board

Changfeng Axle (China) Company Limited Mr. WONG Kwai Mo

Chairman

Hong Kong, 21 October 2014

As at the date of this announcement, the executive directors of the Company are Mr. Wong Kwai Mo, Ms. Wu Ching and Mr. Lai Fengcai; the non-executive director of the Company is Ms. Dong Ying, Dorothy; and the independent non-executive directors of the Company are Mr. Zhu Weizhou, Dr. Li Xiuqing and Mr. Chong Ching Hei.

The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, having made all reasonable inquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statements in this announcement misleading.

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