COFCO (Hong Kong) Limited made a proposal to acquire an additional 39.25% stake in China Agri-Industries Holdings Limited (SEHK:606) for CNY 8.8 billion on November 27, 2019. COFCO (Hong Kong) Limited will acquire 2.06 billion shares at CNY 4.25 each in cash. A total of 92.2 million options will be acquired. COFCO (Hong Kong) Limited intends to finance the entire cash amount required for the proposal from internal cash resources and/or other financing for the Certain Funds Period. Upon completion, China Agri-Industries Holdings Limited will become wholly-owned by COFCO (Hong Kong) Limited. Upon the scheme becoming effective, all scheme shares will be cancelled. China Agri-Industries Holdings Limited will apply to the Stock Exchange for the withdrawal of the listing of the shares on the Stock Exchange in accordance with Rule 6.15 of the Listing Rules, with effect from the effective date. As on January 21, 2020, due to certain conditions for the exercise of certain share options with its vesting schedule not having been met, it was determined that share options granted at an exercise price of HKD 2.85 per share, over an aggregate of 30.98 million shares, will not be exercisable. As a result, total of 61.192 million options will be acquired under the transaction. An Independent Board Committee which comprises Lam Wai Hon, Ambrose, Patrick Vincent Vizzone and Ong Teck Chye has been established by the Board to review and recommend the proposal. The transaction is subject to approval of the scheme at the Court Meeting representing at least 75% of the voting rights, passing of a special resolution by a majority of at least 75% of the votes cast by the shareholders present and voting in person or by proxy at the EGM, sanction of the Scheme and the confirmation of the reduction of the share capital of China Agri-Industries Holdings Limited involved in the scheme by the High Court. The long stop date is September 30, 2020 or such later date as COFCO (Hong Kong) Limited may be determined. As of March 17, 2020, the High Court has sanctioned the scheme document without any modification. The reduction of the share capital of China Agri Industries involved in the Scheme was also confirmed by the High Court on the same day. The Scheme is expected to become effective and all the conditions were fulfilled pertaining to the transaction on Thursday, March 19, 2020. Subject to the scheme becoming effective, the listing of shares on the stock exchange is expected to be withdrawn on March 23, 2020. Edith Leung, Ling Ho, Vicky Ma, Anita Lam, Anthony Fay, Clara Tang, Jacqueline Landells and Weisiyu Jiang of Clifford Chance advised COFCO on CNY 8.04 billion (HKD 9 billion) of financing for the acquisition. China International Capital Corporation Hong Kong Securities Limited acted as the financial advisor to COFCO (Hong Kong) Limited. Benita Yu and Charlton Tse of Slaughter and May acted as legal advisors for COFCO (Hong Kong) Limited.