3602500-m01annc

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 the Cayman Islands with limited liability)

(Stock Code: 3311) CONNECTED TRANSACTION FORMATION OF JOINT VENTURE WITH

中國建築股份有限公司

(CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED) AND

唐山曹妃甸發展投資集團有限公司

(TANGSHAN CAOFEIDIAN DEVELOPMENT INVESTMENT GROUP LIMITED) FORMATION OF JOINT VENTURE

On 8 July 2016, CSCIICL (a wholly-owned subsidiary of the Company), CSCECL and Tangshan Caofeidian entered into the JV Agreement, pursuant to which the parties agreed to establish the Tangshan JV on a 72:18:10 basis. The Tangshan JV is formed in response to the PRC government's promotion of the public-private partnership model to accelerate the urbanisation of the Caofeidian District, Tangshan City, Hebei Province, the PRC by financing and investing in the Infrastructure Projects (i.e. municipal engineering, construction of housing, construction of landscaping projects and operation and management of municipal facilities.)

LISTING RULES IMPLICATIONS

CSCECL is a subsidiary held as to more than 50% by CSCEC, the ultimate holding company of the Company. Accordingly, CSCECL is a connected person of the Company and the Transaction constitutes a connected transaction for the Company under Chapter 14A of the Listing Rules.

Since all of the applicable percentage ratios as defined in Rule 14A.06 of the Listing Rules calculated with reference to the Transaction exceed 0.1% but are less than 5%, the Transaction is subject to the reporting and announcement requirements but exempt from the circular (including independent financial advice) and independent shareholders' approval requirement pursuant to Rule 14A.76 of the Listing Rules.

FORMATION OF JOINT VENTURE

On 8 July 2016, CSCIICL (a wholly-owned subsidiary of the Company), CSCECL and Tangshan Caofeidian entered into the JV Agreement, pursuant to which the parties agreed to establish the Tangshan JV on a 72:18:10 basis. The Tangshan JV is formed in response to the PRC government's promotion of the public-private partnership model to accelerate the urbanisation of the Caofeidian District, Tangshan City, Hebei Province, the PRC by financing and investing in the Infrastructure Projects (i.e. municipal engineering, construction of housing, construction of landscaping projects and operation and management of municipal facilities.)

JV AGREEMENT Date

8 July 2016

Parties
  1. CSCIICL, a wholly-owned subsidiary of the Company;

  2. CSCECL, a subsidiary of CSCEC, the ultimate holding company of the Company; and

  3. Tangshan Caofeidian.

To the best of the knowledge, information and belief of the Directors after having made all reasonable enquiries, as at the date of the announcement, Tangshan Caofeidian and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons (as defined in the Listing Rules).

Subject Matter

CSCIICL, CSCECL and Tangshan Caofeidian shall establish the Tangshan JV for financing and investing in the Infrastructure Projects in Caofeidian District, Tangshan City, Hebei Province, the PRC. CSCIICL, CSCECL and Tangshan Caofeidian shall hold 72%, 18% and 10% equity interests in the Tangshan JV respectively. Upon establishment, the Tangshan JV will be accounted for as a joint venture of the Group.

Registered Capital

The Tangshan JV shall have a registered capital of RMB527,330,000 (equivalent to approximately HK$627,774,000), which shall be contributed by each of CSCIICL, CSCECL and Tangshan Caofeidian as to RMB379,680,000 (equivalent to approximately HK$452,000,000), RMB94,920,000 (equivalent to approximately HK$113,000,000) and RMB52,730,000 (equivalent to approximately HK$62,774,000), respectively. The registered capital shall be contributed by each of the Parties in cash into the Tangshan JV within two years from the establishment of the Tangshan JV, with the first payment being not less than 20% of each Parties' respective total contribution to the registered capital.

The amount of the registered capital of the Tangshan JV is determined after arm's length negotiations between the Parties with reference to current plans and estimated capital requirements of the Infrastructure Projects in Tangshan, Hebei Province, the PRC.

Profit/loss sharing

The profit/loss in respect of the Tangshan JV shall be shared by the Parties in proportion to their respective equity interests in the Tangshan JV.

Restrictions on equity transfers

Neither CSCIICL nor CSCECL may transfer its equity interest in Tangshan JV to a third party (not being an original shareholder or its affiliate) without the prior written consent of the other Parties and approval from the relevant authority. Tangshan Caofeidian may not transfer its equity interest in Tangshan JV to a third party (not being the original shareholder or its affiliate) without the prior written consent of the other Parties where such transfer will adversely affect the financing of the Infrastructure Projects. In the event that any Party proposes to transfer its equity interest in Tangshan JV to a third party (not being an original shareholder or its affiliate), the other Parties shall have a right of first refusal to such equity interest.

Management

The board of directors of the Tangshan JV shall comprise of seven directors, of which five directors shall be appointed by CSCIICL, one director shall be appointed by CSCECL and one director shall be appointed by Tangshan Caofeidian. The chairman of the board shall be a director appointed by CSCIICL, who shall also be the legal representative of the Tangshan JV. Decisions of the board of directors of the Tangshan JV shall be resolved by two thirds of the Directors pursuant to the JV Agreement, save for certain reserved matters (including but not limited to

amendment of articles of association, profit sharing, approval of Tangshan JV's development strategies, production and operational plans, investment plans, annual budget, merger dissolution or winding-up of Tangshan JV etc) which shall be resolved by all the directors unanimously.

The Tangshan JV shall have three supervisors, of which one shall be appointed by CSCECL, one shall be appointed by Tangshan Caofeidian and the remaining employee representative supervisor shall be elected through an employee representative congress of the Tangshan JV.

The general manager, deputy general manager and the chief financial officer of the Tangshan JV shall be appointed by CSCIICL and be responsible for the management of the normal operations of Tangshan JV and reporting to the board of directors of Tangshan JV.

Future funding

Any additional funding requirements (other than the registered capital) of the Tangshan JV shall be arranged by the Tangshan JV.

INFORMATION ABOUT THE TANGSHAN JV

The Tangshan JV will be engaged in financing and investing in the Infrastructure Projects (i.e. municipal engineering, construction of housing, construction of landscaping projects and operation and management of municipal facilities) in Tangshan City, Hebei Province, the PRC. It is currently anticipated that the Tangshan JV will focus on the basic infrastructure public-private partnership project in Caofeidian District, Tangshan City, Hebei Province, the PRC.

REASONS FOR AND BENEFITS OF THE TRANSACTION

CSCECL has substantial experience in the PRC construction industry. The Transaction provides the Company with the opportunity to participate in infrastructure projects in the PRC with CSCECL as its joint venture partner. The Directors believe that such arrangement will generate synergetic effects, which will be beneficial to the Group.

The Directors (including the independent non-executive Directors) consider that the Transaction is in the ordinary course of business, on normal commercial terms after arm's length negotiations between the Parties, and the terms of the Transaction are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

China State Construction International Holdings Ltd. published this content on 08 July 2016 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 12 July 2016 03:33:02 UTC.

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