Shenzhen Investment : Announcements and Notices - Potential Disposal of the Entire Equity Interest and Sharheolder's Loan in Certain Indirect Wholly-owned Subsidiaries Through Public Listing-for-sale

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)

The Board announces that the Company intends to dispose the entire equity interest and shareholder's loan in (1) Three Sanshui Project Companies; (2) Pengji Assets Management Company; and (3) Pengxiang Company, all being indirect wholly-owned subsidiaries of the Company. In accordance with the relevant requirements applicable to transfer of state-owned equity interest, the listing-for-sale process in respect with the Potential Disposals will commence at Shenzhen United Property and Share Rights Exchange on 24 April 2017.

Three Sanshui Project Companies, Pengji Assets Management Company and Pengxiang Company are project companies holding property development projects in the third- and fourth-tier cities in the PRC.

The initial bidding price for the transfer of the Interests in Three Sanshui Project Companies is RMB2,815,481,800 (of which equity interest amounts to approximately RMB299 million and shareholder's loan amounts to approximately RMB2.517 billion).

The initial bidding price for the transfer of the Interests in Pengji Assets Management Company is RMB2,604,575,600 (of which equity interest amounts to approximately RMB1.141 billion and shareholder's loan amounts to approximately RMB1.463 billion).

The initial bidding price for the transfer of the Interests in Pengxiang Company is RMB228,982,100 (of which equity interest amounts to approximately RMB11.71 million and shareholder's loan amounts to approximately RMB217 million).

The initial bidding price is determined at a price not less that the appraised value approved by the relevant regulatory authority of state-owned assets in the PRC. The final consideration will depend on the final bid price offered by the successful bidder, which in any event will be no less than the initial bidding price.

Taking into account the respective initial bidding price of the Potential Disposals, one of the applicable percentage ratios as set out in the Listing Rules in relation to the respective potential disposal of the Interests in (1) Three Sanshui Project Companies, in aggregate; and

(2) Pengji Assets Management Company is expected to be more than 5% but less than 25%, such potential disposals, if materialized, may each constitute a discloseable transaction for the Company and is, therefore, subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules. As all the applicable percentage ratios in relation to the potential disposal of the Interests in Pengxiang Company are expected to be less than 5%, such potential disposal does not constitute a notifiable transaction under Chapter 14 of the Listing Rules.

Further announcement(s) will be made by the Company in accordance with the Listing Rules as and when appropriate.

This announcement is made by the Company pursuant to Rule 13.09 of the Listing Rules and the Inside Information Provisions (as defined under the Listing Rules) under Part XIVA of the SFO.

The Board announces that the Company intends to dispose the entire equity interest and shareholder's loan in (1) Three Sanshui Project Companies; (2) Pengji Assets Management Company; and (3) Pengxiang Company, all being indirect wholly-owned subsidiaries of the Company. In accordance with the relevant requirements applicable to transfer of state-owned equity interest, the listing-for-sale process in respect with the Potential Disposals will commence at Shenzhen United Property and Share Rights Exchange on 24 April 2017.

Three Sanshui Project Companies, Pengji Assets Management Company and Pengxiang Company are project companies holding property development projects in the third- and fourth-tier cities in the PRC.

The Three Sanshui Project Companies are companies established in the PRC, and indirect wholly-owned subsidiaries of the Company. Three Sanshui Project Companies together own the development project located at Sanshui District, Fushan City, the PRC. The planned land use of the land is low-density residential and commercial/services usage. 1,073 mu of the land is undeveloped land. On the part of the developed land, there were 139 villas with a gross floor area of 64,996.14 sq.m. remained unsold as of 31 March 2017.

Public listing in respect of the transfer of the Interests in Three Sanshui Project Companies will be carried out individually by company. However, as a condition of the public listing, in order to be qualified as the transferee, intended transferees shall at the same time have valid registration for the bidding and paid the security deposit for the transfer of the Interests in Three Sanshui Project Companies.

The initial bidding price for the transfer of the Interests in Three Sanshui Project Companies is RMB2,815,481,800 (of which equity interest amounts to approximately RMB299 million and shareholder's loan amounts to approximately RMB2.517 billion).

The respective information on the Three Sanshui Project Companies is set out below:

Sanshui Property

As at 31 October 2016, Sanshui Property had total assets of approximately RMB2.101 billion and liabilities of approximately RMB2.403 billion according to audited report; and the appraised value of the equity interest of Sanshui Property amounted to approximately RMB214 million according to the appraisal report issued by an independent asset appraisal institution.

The initial bidding price for the transfer of the Interests in Sanshui Property is RMB2,571,992,500 (of which equity interest amounts to approximately RMB214 million and shareholder's loan amounts to approximately RMB2.358 billion).

Sanshui Investment

As at 31 October 2016, Sanshui Investment had total assets of approximately RMB114 million and liabilities of approximately RMB94 million according to audited report; and the appraised value of the equity interest of Sanshui Investment amounted to approximately RMB46 million according to the appraisal report issued by an independent asset appraisal institution.

The initial bidding price for the potential disposal of the entire equity interest in Sanshui Investment is RMB45,536,400. And, the loan due to Sanshui Investment from the transferor in the amount of RMB19,976,490 will be repaid to Sanshui Investment by the transferor after the transfer of the equity interest has taken place.

Sanshui Hotel

As at 31 October 2016, Sanshui Hotel had total assets of approximately RMB187 million and liabilities of approximately RMB167 million according to audited report; and the appraised value of the equity interest of Sanshui Hotel amounted to approximately RMB39 million according to the appraisal report issued by an independent asset appraisal institution.

The initial bidding price for the transfer of the Interests in Sanshui Hotel is RMB197,952,900 (of which equity interest amounts to approximately RMB39 million and shareholder's loan amounts to approximately RMB159 million).

Pengji Assets Management Company is a company established in the PRC, an indirect wholly-owned subsidiary of the Company. Pengji Assets Management Company, through its wholly-owned subsidiary, owns the development project" Shanglin Garden" ( 上林苑) located at Zhoushanhe Xincheng, Taizhou City, Jiangsu Province, the PRC. The planned land use of the project is commercial/residential usage. 275 mu of the land is undeveloped land whereas gross floor area of 105,563 sq.m. is under construction. On the part where construction has been completed, 46 residential units with gross floor area of 4,969.75 sq.m. and 22 commercial units with gross floor area of 5,423.94 sq.m. remained unsold as of 14

April 2017. And, 4,000 sq.m. and 7,800 sq.m. of public housing on the northern part and southern part of the land respectively are built for Taizhou government for free.

As at 31 December 2016, Pengji Assets Management Company had total assets of approximately RMB1.455 billion and liabilities of approximately RMB1.559 billion according to audited report; and the appraised value of the equity interest of Pengji Assets