Geely Automobile : (1) DISCLOSEABLE AND CONNECTED TRANSACTIONS IN RELATION TO THE ACQUISITIONS; (2) CONTINUING CONNECTED TRANSACTIONS UPON COMPLETION OF THE ACQUISITIONS; (3) FURTHER REVISION OF ANNUAL CAPS FOR THE TRANSACTIONS UNDER THE SERVICES AGREEMENT; AND (4) EXPECTED DATE OF DESPATCH OF CIRCULAR IN RELATION TO THE LYNK & CO FINANCING ARRANGEMENTS

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吉利汽車控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 175)

1. DISCLOSEABLE AND CONNECTED TRANSACTIONS IN RELATION TO THE ACQUISITIONS;
2. CONTINUING CONNECTED TRANSACTIONS UPON COMPLETION OF THE ACQUISITIONS;
3. FURTHER REVISION OF ANNUAL CAPS FOR THE TRANSACTIONS UNDER THE SERVICES AGREEMENT; AND
4. EXPECTED DATE OF DESPATCH OF CIRCULAR IN RELATION TO THE LYNK & CO FINANCING ARRANGEMENTS

   Financial Adviser to Geely Automobile Holdings Limited

   Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

5. DISCLOSEABLE AND CONNECTED TRANSACTIONS IN RELATION TO THE ACQUISITIONS

6. Baoji Acquisition

On 7 November 2017 (after trading hours), Geely Luoyou, a 99% owned subsidiary of the Company, entered into the Baoji Acquisition Agreement with Zhejiang Geely pursuant to which Geely Luoyou has conditionally agreed to acquire, and Zhejiang Geely has conditionally agreed to sell, the entire registered capital of the Baoji Target, for a consideration of RMB345,100,000.

1. Yili Acquisition

   On 7 November 2017 (after trading hours), Geely Luoyou entered into the Yili Acquisition Agreement with Zhejiang Geely and Shanghai Maple pursuant to which Geely Luoyou has conditionally agreed to acquire, and Zhejiang Geely and Shanghai Maple have conditionally agreed to sell, the entire registered capital of the Yili Target, for a consideration of RMB495,000,000.

2. SZX Acquisition

On 7 November 2017 (after trading hours), Geely Luoyou entered into the SZX Acquisition Agreement with Geely Holding pursuant to which Geely Luoyou has conditionally agreed to acquire, and Geely Holding has conditionally agreed to sell, the entire registered capital of the SZX Target for a consideration of RMB993,100,000.

1. CONTINUING CONNECTED TRANSACTIONS UPON COMPLETION OF THE ACQUISITIONS

   On 7 November 2017, the Company entered into the Powertrain Sales Agreement with LYNK & CO and Geely Holding pursuant to which the Group has conditionally agreed to sell vehicle engines, transmissions and related after-sales parts manufactured by the Target Companies to the LYNK & CO Group and the Geely Holding Group after completion of the Acquisitions for a term of three years from 1 January 2018 to 31 December 2020. The proposed Powertrain Sales Annual Caps for the years ending 31 December 2018, 2019 and 2020 are RMB9,179,760,000, RMB14,556,510,000 and RMB15,661,070,000, respectively.

2. FURTHER REVISED ANNUAL CAPS FOR THE TRANSACTIONS UNDER THE SERVICES AGREEMENT

   Reference is made to the Company's announcements dated 27 November 2009, 13 November 2015 and 18 October 2016 in relation to the Services Agreement, the original annual caps and the Revised Annual Caps (as defined below) for the years ending 31 December 2016, 2017 and 2018 under the Services Agreement.

   The Services Agreement was entered into between the Company and Geely Holding on 27 November 2009 and has a term of 10 years from 1 January 2010 to 31 December 2020. Pursuant to the Services Agreement, (i) the Group has agreed to sell CKDs and Sedan Tool Kits to the Geely Holding Group; and (ii) the Geely Holding Group has agreed to sell CBUs, automobile parts and components, and provide process manufacturing services to the Group. The Services Agreement was approved by the then independent shareholders of the Company at the extraordinary general meeting of the Company held on 31 December 2009.

   In view of the better-than-expected demand for the Group's products, the Board expects that the Revised Annual Caps for the sale of CKDs and purchase of CBUs under the Services Agreement for the two years ending 31 December 2018 will not be sufficient to meet the Company's requirements. Accordingly, the Board resolved to further revise the annual caps for the sale of CKDs and purchase of CBUs for the two years ending 31 December 2018 under the Services Agreement. Pursuant to the requirements of the Listing Rules, the Company will seek approval from the Independent Shareholders at the EGM for the Further Revised Annual Caps for the two years ending 31 December 2018 under the Services Agreement. Save for the Further Revised Annual Caps, other terms of the Services Agreement remain unchanged.

   IMPLICATIONS UNDER THE LISTING RULES
3. Connected and discloseable transactions contemplated under the Acquisition Agreements

   As at the date of this announcement, both Zhejiang Geely and Shanghai Maple are owned as to 90% by Geely Holding, which in turn is beneficially wholly owned by Mr. Li and his associate. As such, each of Zhejiang Geely, Shanghai Maple and Geely Holding is an associate of Mr. Li, an executive Director and a substantial Shareholder holding approximately 44.03% of the total issued share capital of the Company as at the date of this announcement, and is a connected person of the Company. Accordingly, the Acquisitions constitute connected transactions for the Company pursuant to Chapter 14A of the Listing Rules.

   As one or more of the applicable percentage ratios in respect of the Acquisitions in aggregate is more than 5%, the Acquisitions are subject to the reporting, announcement and the Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules. Furthermore, as one or more of the applicable percentage ratios in respect of the Acquisitions in aggregate is more than 5% but less than 25%, the Acquisitions also constitute discloseable transactions for the Company under Chapter 14 of the Listing Rules.

4. Continuing connected transactions contemplated under the Powertrain Sales Agreement and continuing connected transactions under the Services Agreement

LYNK & CO is a joint venture of the Company and is owned as to 50% by Zhejiang Jirun, as to 20% by Zhejiang Haoqing and as to 30% by VCI as at the date of this announcement. Zhejiang Haoqing and VCI are owned as to 90% and 99%, respectively by Geely Holding. As Geely Holding is a connected person of the Company, the transactions contemplated under the Powertrain Sales Agreement constitute continuing connected transactions for the Company.

As one or more of the applicable percentage ratios of the proposed Powertrain Sales Annual Caps under the Powertrain Sales Agreement exceed(s) 5% on an annual basis, the continuing connected transactions contemplated under the Powertrain Sales Agreement are subject to the reporting, annual review, announcement and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

In addition, as one or more of the applicable percentage ratios of the Further Revised Annual Caps under the Services Agreement also exceed(s) 5% on an annual basis, the Further Revised Annual Caps under the Services Agreement are also subject to the reporting, annual review, announcement and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

Mr. Li, Mr. Yang Jian, Mr. Li Dong Hui, Daniel and Mr. An Cong Hui, each an executive Director, are considered to have material interests in the Acquisition Agreements, the Powertrain Sales Agreement and the Services Agreement by virtue of their interests and/or directorship in Geely Holding. As a result, Mr. Li, Mr. Yang Jian, Mr. Li Dong Hui, Daniel and Mr. An Cong Hui have abstained from voting on the Board resolutions for approving the Acquisition Agreements and the transactions contemplated thereunder, the Powertrain Sales Agreement (including the Powertrain Sales Annual Caps) and the transactions contemplated thereunder, and the Further Revised Annual Caps under the Services Agreement.

GENERAL

An Independent Board Committee has been formed to advise the Independent Shareholders with respect to the Acquisition Agreements and the transactions contemplated thereunder, the Powertrain Sales Agreement and the transactions contemplated thereunder, and the Further Revised Annual Caps under the Services Agreement, and an Independent Financial Adviser has been appointed to advise the Independent Board Committee and the Independent Shareholders on whether the terms of the Acquisition Agreements and the transactions contemplated thereunder, the Powertrain Sales Agreement and the transactions contemplated thereunder, and the Further Revised Annual Caps under the Services Agreement are fair and reasonable and in the interests of the Company and the Independent Shareholders. A circular containing, among other things, (i) further information about the Acquisition Agreements, the Powertrain Sales Agreement and the Further Revised Annual Caps, respectively; (ii) the recommendation of the Independent Board Committee in respect of the Acquisition Agreements, the Powertrain Sales Agreement and the Further Revised Annual Caps; (iii) the advice of the Independent Financial Adviser regarding the terms of the Acquisition Agreements, the Powertrain Sales Agreement and the Further Revised Annual Caps; and (iv) other information as required under the Listing Rules together with the notice of the EGM, will be despatched to the Shareholders on or before 8 December 2017 (which is more than 15 business days after the publication of this announcement) after taking into account the time required for preparing and gathering the relevant information to be contained in the circular.