China Agri : Connected Transaction

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.

(Incorporated in Hong Kong with limited liability)

On 11 August 2014, Excel Joy and Excel Joy Storage entered into the Absorption and
Merger Agreement, pursuant to which:
a) Excel Joy Storage shall be merged and absorbed by Excel Joy (the "Merger

b) to facilitate and in consideration of the Merger Transaction, Excel Joy will increase its registered capital which will be apportioned to each of COFCO and Excel Joy International with reference to (i) the assessed net asset value of each of Excel Joy and Excel Joy Storage, and (ii) the respective equity interests of COFCO and Excel Joy International in each of Excel Joy and Excel Joy Storage before the Merger Transaction.

COFCO is a substantial shareholder of the Company (not in the subsidiary level) which holds more than 10% equity interest in each of Excel Joy and Excel Joy Storage, both being the Company's non-wholly-owned subsidiaries. Therefore, each of Excel Joy and Excel Joy Storage are connected subsidiaries of the Company pursuant to Rule 14A.16 of the Listing Rules. As the percentage ratios as calculated pursuant to Rule 14.07 of the Listing Rules are more than 0.1%, but less than 5%, the transactions contemplated under the Absorption and Merger Agreement are only subject to the reporting and announcement requirements but exempted from the requirement for independent shareholders' approval under Chapter 14A of the Listing Rules.

Date: 11 August 2014
Parties: Excel Joy, as merging party
Excel Joy Storage, as merged party
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The current status of each of Excel Joy and Excel Joy Storage

The registered capital and total investment of each of Excel Joy and Excel Joy Storage have been fully paid up and no additional payment is required pursuant to the Absorption and Merger Agreement.

The status of Excel Joy after completion of the Absorption and Merger Agreement

Registered capital USD269,068,392.44
Total investment USD292,834,957.43

The shareholding structure of relevant parties immediately before the completion of the

Absorption and Merger Agreement

COFCO

58.00%

the Company

100% Excel Joy

International

24.17%

23.39%

75.83%

Excel Joy Excel Joy Storage

76.61%

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The shareholding structure of relevant parties immediately after the completion of the

Absorption and Merger Agreement

COFCO

58.00%

the Company

100% Excel Joy

International

24.06%

75.94%

Excel Joy

After the completion of the absorption and merger, Excel Joy will become the owner of all of the assets and liabilities of Excel Joy Storage and take up its business and staff.

Excel Joy and Excel Joy Storage are indirectly non-wholly-owned subsidiaries of the Company. Excel Joy is principally engaged in the production and sale of edible oil. Excel Joy Storage's principal activities are provision of storage services to Excel Joy. Both companies are in closely related lines of business and are located in Harbor Economic Area of Tianjin, China. The Merger Transaction will fully integrate the business of Excel Joy Storage and Excel Joy. Thus, it will also help to optimise the internal management structure, achieve cost saving and enhance the operation efficiency of the Group.

Financial Information

As of 31 December 2013, the audited net asset value of Excel Joy was approximately RMB1,013,419,500 and set out below is the audited net profit/(loss) before and after tax of Excel Joy for the two financial years ended 31 December 2012 and 2013:

RMB RMB

Audited net profit before tax 15,027,300 176,700
Audited net profit/(loss) after tax 26,797,600 (916,500)
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Upon completion of the Absorption and Merger Agreement, the shareholding in Excel Joy held indirectly by the Company will increase from 75.83% to approximately 75.94%. Excel Joy will continue to be a subsidiary of the Company.

Financial Information

As of 31 December 2013, the audited net asset value of Excel Joy Storage was approximately RMB240,086,400 and set out below is the audited net profit before and after tax of Excel Joy Storage for the two financial years ended 31 December 2012 and 2013:

RMB RMB

Audited net profit before tax 3,049,500 2,368,800
Audited net profit after tax 3,049,500 2,368,800
Upon completion of the Absorption and Merger Agreement, Excel Joy Storage will be dissolved.

Excel Joy Valuation Report and Storage Valuation Report

Excel Joy Storage shall be absorbed and merged by Excel Joy. The respective adjusted equity interests of Excel Joy International and COFCO in Excel Joy were determined pro-rata with reference to the assessed net asset value of Excel Joy and Excel Joy Storage pursuant to the Excel Joy Valuation Report and the Storage Valuation Report conducted by an independent valuer which adopted the replacement cost approach. As at 31 May 2014, the assessed net asset value of each of Excel Joy and Excel Joy Storage was RMB1,507.04 million and RMB259.06 million, respectively.

COFCO is a substantial shareholder of the Company (not in the subsidiary level) which holds more than 10% equity interest in each of Excel Joy and Excel Joy Storage, both being the Company's non-wholly-owned subsidiaries. Therefore, each of Excel Joy and Excel Joy Storage are connected subsidiaries of the Company pursuant to Rule 14A.16 of the Listing Rules. As the percentage ratios as calculated pursuant to Rule 14.07 of the Listing Rules are more than 0.1%, but less than 5%, the transactions contemplated under the Absorption and Merger Agreement are only subject to the reporting and announcement requirements but exempted from the requirement for independent shareholders' approval under Chapter 14A of the Listing Rules.
The Directors (including independent non-executive Directors) are of the view that the Absorption and Merger Agreement is on normal commercial terms which have been negotiated at an arm's length basis and are fair and reasonable and are in the interests of the shareholders of the Company as a whole. According to the articles of association of the Company, only the independent non-executive directors participated in the voting for approving the Absorption and Merger Agreement and none of them has a material interest in the transactions contemplated thereunder.
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The Group is a leading producer and supplier of processed agricultural products in the PRC. It offers a diverse range of products to its customers in and outside the PRC and it enjoys market leading positions in the majority of its businesses including oilseeds processing, biochemical and biofuel, rice processing and trading, wheat processing and brewing materials.

The principal activity of Excel Joy International is investment holding.

The principal activities of Excel Joy are production and sale of edible oil.

The principal activities of Excel Joy Storage are provision of storage services.

COFCO is the ultimate controlling shareholder indirectly holding approximately 58% of the total issued shares of the Company. COFCO is a state-owned company in the PRC with business interests in agricultural commodities trading, agricultural products processing, food and beverages, hotel management, real estate, logistics and financial services.

In this announcement, unless the context otherwise requires, the following expressions have the following meanings:
"Absorption and
Merger Agreement"
the absorption and merger agreement entered into between
Excel Joy and Excel Joy Storage on 11 August 2014;
"Board" the board of directors of the Company;
"COFCO" C O F C O C orporation ( r=I�IIJ1�0Pl ), a w holly state-owned company established in the PRC currently under the purview of the State-owned Assets Supervision and Administration Commission of the State Council of the PRC, the ultimate controlling shareholder of the Company;
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"Company'' C h i n a A g ri-Industries Holdings Limited, a compan y incorporated in Hong Kong with limited liability, the shares of which are listed on the main board of The Stock Exchange of Hong Kong Limited;
"Director(s) '' the director(s) of the Company;
"Excel Joy" COFCO Excel Joy (Tianjin) Co., Ltd. (r=I1JZ(x?$)1

�0Pl), a non-wholly-owned subsidiary of the Company

and is owned as to approximately 75.83% by Excel Joy
International and approximately 24.17% by COFCO;
"Excel Joy International" Excel Joy International Limited, a company incorporated in the British Vi r gin Islands with limited liability, a wholly-owned subsidiary of the Company;
"Excel Joy Storage" Tianjin COFCO Excel Joy Lingang Storage Co., Ltd. (x?$r= I1JZim�ir�1�0Pl), a non-wholly-owned subsidiary
of the Company and is owned as to approximately 76.61% by Excel Joy International and approximately 23.39% by COFCO;
"Excel Joy Valuation Report" t h e v a l u a t i o n r eport issued by China United A ssets Appraisal Group Co., Ltd. in relation to the valuation of Excel Joy with the benchmark date of 31 May 2014;
"Group" the Company and its subsidiaries;
"Listing Rules'' the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited;
"PRC'' the People's Republic of China;
"Storage Valuation Report'' t h e v a l u a t i o n r eport issued by China United A ssets Appraisal Group Co., Ltd. in relation to the valuation of Excel Joy Storage with the benchmark date of 31 May 2014.
By Order of the Board

Managing Director

Hong Kong, 11 August 2014

As at the date of this announcement, the Board comprises: Mr. YU Xubo, as chairman of the Board and executive director; Mr. YUE Guojun and Mr. SHI Bo as executive directors; Mr. NING Gaoning, Mr. MA Wangjun and Mr. WANG Zhiying as non-executive directors; and Mr. LAM Wai Hon, Ambrose, Mr. Victor YANG and Mr. Patrick Vincent VIZZONE as independent non-executive directors.

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