Greentown China : DISCLOSEABLE TRANSACTION IN RELATION TO THE ACQUISITION OF SHARES IN SHANGHAI XINHU

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.

GREENTOWN CHINA HOLDINGS LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 03900)

DISCLOSEABLE TRANSACTION

IN RELATION TO

THE ACQUISITION OF SHARES IN SHANGHAI XINHU

On 17 December 2019, the Purchaser (a wholly-owned subsidiary of the Company), the Vendors, the Target Company and the Vendors' Parent Company entered into the Share Transfer and Cooperation Agreement, pursuant to which the Purchaser agreed to acquire the Target Shares, representing 35% of the total shares of the Target Company as at the date of the Share Transfer and Cooperation Agreement, for an aggregate amount of RMB3,600,000,000 payable by the Purchaser in accordance with the Share Transfer and Cooperation Agreement, including a share transfer consideration of RMB550,000,000 and a financial assistance of RMB3,050,000,000. The purpose of the Share Transfer and Cooperation Agreement is mainly to set out the terms of cooperation among the Vendors, the Purchaser and Shenzhen Donghaichao for the development of the Target Project, namely Section 4 of Phase Three of the Pearl City Project.

As one or more of the applicable percentage ratio(s) calculated pursuant to Rule 14.07 of the Listing Rules in respect of the Acquisition (based on the Share Transfer Consideration and Financial Assistance contemplated thereunder) is more than 5% but less than 25%, the transaction constitutes a discloseable transaction for the Company and is subject to the reporting and announcement requirements.

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INTRODUCTION

The Board announces that on 17 December 2019, the Purchaser (a wholly-owned subsidiary of the Company), the Vendors, the Target Company and the Vendors' Parent Company entered into the Share Transfer and Cooperation Agreement, pursuant to which the Purchaser agreed to acquire the Target Shares, representing 35% of the total shares of the Target Company as at the date of the Share Transfer and Cooperation Agreement, for an aggregate amount of RMB3,600,000,000 payable by the Purchaser in accordance with the Share Transfer and Cooperation Agreement, including a share transfer consideration of RMB550,000,000 and a financial assistance of RMB3,050,000,000.

SHARE TRANSFER AND COOPERATION AGREEMENT

Principal terms of the Share Transfer and Cooperation Agreement are set out below:

Date	:	17 December 2019
Parties	:	(1)	the Purchaser;
		(2)	the Vendors;
		(3)	the Target Company; and
		(4)	the Vendors' Parent Company.
		To the best of the knowledge, information and belief of
		the Directors, having made all reasonable enquiries, each
		of the Vendors, the Target Company and the Vendors'
		Parent Company and their respective ultimate beneficial
		owners are not connected persons of the Company.
Subject matter	:	The Purchaser agreed to purchase, and the Vendors as
		legal and beneficial owners of the Target Shares agreed to
		sell (by transfer of 28% and 7% of the total shares of the
		Target Company held by Zhejiang Yunsheng and Xinhu
		Real Estate, respectively), the Target Shares. The Target
		Shares represent 35% of the total shares of the Target
		Company.

The purpose of the Share Transfer and Cooperation Agreement is mainly to set out the terms of cooperation for the development of the Target Project, namely Section 4 of Phase Three of the Pearl City Project, pursuant to which such parties shall share the benefits and bear the risks of the Target Project as to 35% by the Purchaser and 65% by the Original Shareholders of the Target Company. The parties to the Share Transfer and Cooperation Agreement intend that the Purchaser will not participate in the Non-Target Projects.

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Pursuant to the Share Transfer and Cooperation Agreement, the benefits and risks arising from the Non- Target Projects (namely the assets and liabilities and projects of the Target Company other than the Target Project, including Phase 1, Phase 2 and Section 1-3 of Phase 3 of the Pearl City Project (the development of which has been completed), other assets, long term equity investments etc.) shall be shared and borne by the Original Shareholders of the Target Company. Accordingly, the Purchaser shall not enjoy such benefits or bear such risks.

The parties to the Share Transfer and Cooperation Agreement acknowledge that, save as otherwise provided, the shareholders' rights and interests attributable to the Target Shares shall be limited to:

(a) the amount of paid - up capital contribution corresponding to the Target Shares (i.e. 35% of RMB200,000,000, equivalent to RMB70,000,000) and the paid-up capital, capital reserve and surplus to be generated from the Target Project; and

(b) 35% of all existing assets of the Target Project, 35% of the assets and income to be generated upon completion of the Target Project and 35% of all obligations, risks and responsibilities of investing and developing such assets.

Amount payable	:	The Share Transfer and Cooperation Agreement
		states that the Purchaser shall contribute a total of
		RMB3,600,000,000, of which:
		(a) RMB550,000,000 as consideration for the transfer
		of the Target Shares (the " Share Transfer
		Consideration"); and
		(b) RMB3,050,000,000 as loan to be provided by the
		Purchaser (or its designated entity) to the Target
		Company (the "Financial Assistance").

The amount of the Share Transfer Consideration and Financial Assistance was agreed after arm's length negotiations among the parties to the Share Transfer and Cooperation Agreement having considered, among other things, the development potential of the Target Project with reference to the prevailing market conditions.

The Group intends to finance the aforesaid amount by the

Group's internal financial resources.

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Financial Assistance	T h e F i n a n c i a l A s s i s t a n c e i n t h e a m o u n t o f
	RMB3,050,000,000 shall be provided by the Purchaser
	to the Target Company at an interest rate of 10% per
	annum. All the principal and interests of the Financial
	Assistance shall be payable by the Target Project via the
	Target Company no later than 28 December 2023 unless
	otherwise provided.
	The Target Company will on-lend such amount of
	RMB3,050,000,000 to the Vendors, for them to contribute
	to the operation and management of the Target Project and
	to settle certain liabilities owed by the Target Company.

Payment:	Stage payment
	Within 3 business days upon
	the satisfaction of all conditions
	p r e c e d e n t u n d e r t h e S h a r e
	T r a n s f e r a n d C o o p e r a t i o n
	A g r e e m e n t ( t h e " S t a g e 1
	Payment")

Amount payable

RMB1,800,000,000, which consists of the follows:

1. RMB220,000,000 shall be payable by the Purchaser

t o Z h e j i a n g Y u n s h e n g a s

part of the Share	Transfer
Consideration;
(ii) R M B 5 5 , 0 0 0 , 0 0 0	s h a l l b e
payable by the Purchaser
t o X i n h u R e a l E s t a t e a s
part of the Share	Transfer
Consideration; and

1. RMB1,525,000,000 shall be payable by the Purchaser to the Target Company as part of the Financial Assistance.

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Within 3 business days after	RMB1,800,000,000, which consists
(i) the completion of the share	of the follows:
transfer of the Target Shares; and
(ii) the completion of settling the	(i)	RMB220,000,000 shall be
Stage 1 Payment by the Vendors		payable by the Purchaser
for the agreed purposes		t o Z h e j i a n g Y u n s h e n g a s
		part of the Share Transfer
		Consideration;
	(ii)	R M B 5 5 , 0 0 0 , 0 0 0 s h a l l b e
		payable by the Purchaser
		t o X i n h u R e a l E s t a t e a s
		part of the Share Transfer
		Consideration; and
	(iii)	RMB1,525,000,000 shall be
		payable by the Purchaser to
		the Target Company as part of
		the Financial Assistance.

Conditions precedent	:	Completion of the transactions contemplated under the
		Share Transfer and Cooperation Agreement is conditional
		upon the satisfaction of certain conditions precedent. A
		summary of the conditions precedent is as follows:
		(a)	the representations and warranties given by the
			Vendors under the Share Transfer and Cooperation
			Agreement remaining true, accurate, complete and
			not misleading in all material respects;
		(b)	absence of laws or government orders passed by
			any government departments that would make the
			transactions contemplated under the Share Transfer
			and Cooperation Agreement illegal or otherwise
			restrict or prohibit such transactions;
		(c)	absence of claims or potential claims initiated
			against any parties to the Share Transfer and
			Cooperation Agreement which may restrict the
			transactions contemplated under the Share Transfer
			and Cooperation Agreement, materially and
			adversely affect the terms of such transactions

or which may, in the reasonable opinion of the Purchaser, render completion of the Share Transfer and Cooperation Agreement impossible or illegal;

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1. all necessary approval, permits, consents and authorisations having been obtained and maintained by the parties to the Share Transfer and Cooperation Agreement pursuant to applicable rules and regulations;
2. (i) all necessary authorisations, approvals, consents, registrations and filings from relevant government departments; (ii) all necessary internal approvals from the parties to the Share Transfer and Cooperation Agreement; and (iii) all necessary third party consents having been obtained to execute the Share Transfer and Cooperation Agreement and complete the transactions contemplated under the Share Transfer and Cooperation Agreement, which include (among other things), in respect of the Purchaser, the Company having obtained the approval from the Board and its independent Shareholders (if required);
3. the entry into and performance of all transaction

d o c u m e n t s i n r e l a t i o n t o t h e t r a n s a c t i o n s contemplated under the Share Transfer and Cooperation Agreement; and

1. absence of event that, singly or jointly, causes any material adverse effect, and based on the reasonable expectation, there would not incur an event that would, singly or jointly, cause any material adverse effect.

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Completion	:	Subject to satisfaction of the conditions precedent and
		completion of the Stage 1 Payment, completion of the
		Acquisition shall take place upon completion of the
		registration with the relevant governmental authorities of
		change of shareholder in the Target Company.
Rights and obligations		Upon completion of the Acquisition, the rights and
of the Purchaser		obligations of the Purchaser shall be governed by the
		provisions set forth in the Share Transfer and Cooperation
		Agreement. The parties to the Share Transfer and
		Cooperation Agreement agree that upon completion of
		the Acquisition, the Purchaser shall, among other things,
		enjoy and assume 35% of the rights and obligations
		(including profit distribution rights and assumption of
		loss) attributable to the Target Project but no other rights
		or obligations arising from the Non-Target Projects.
Management of the	:	Significant matters of the Target Company (including but
Target Company		not limited to increase or reduction in capital, amendments
		to the memorandum and articles of association, mergers,
		demergers and liquidation) shall require the approval of
		the shareholders of the Target Company at the general
		meetings and shall be voted in proportion to the shares
		held by each shareholder.
		Certain matters set forth in the Share Transfer and
		Cooperation Agreement that are unrelated to the Target
		Project or unrelated to the benefits of the Purchaser under
		the Target Project shall be approved by shareholders
		representing more than one half of voting rights of
		the Target Company at the general meetings. Save as
		aforesaid or unless otherwise provided in the Share
		Transfer and Cooperation Agreement, other matters to
		be approved by shareholders' resolution shall require the
		approval of both the Vendors and the Purchaser.
		The board of directors of the Target Company will consist
		of three directors, of which two will be nominated by the
		Vendors and one will be nominated by the Purchaser.
		The chairman of the board of directors shall be one of the
		directors nominated by the Vendors.
		The general manager shall be responsible for the
		management of the Target Company and shall be
		nominated by the Vendors. The executive general
		Manager shall be nominated by the Purchaser, and shall
		assist the general manager in developing and managing
		projects of the Target Company.

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Use of fundings by the	:	In the event that the Target Company, after deducting the
Target Project		Required Fund (as defined below), has surplus cash in its
		accounts, such cash shall be:
		(i)	a p p l i e d f o r t h e r e p a y m e n t o f t h e F i n a n c i a l
			Assistance;
		(ii)	upon full repayment of the Financial Assistance,
			provided to the Purchaser as interest bearing loan
			until the cash flow returned to the Purchaser and
			the Original Shareholders of the Target Company
			reaches the ratio of 35:65;
		(iii)	provided to the Purchaser and the Original
			Shareholders of the Target Company as interest
			bearing loan on a 35:65 basis;
		(iv)	when the surplus cash returned to the Purchaser and
			the Original Shareholders of the Target Company
			reaches the ratio of 35:65 and the Purchaser's capital
			returned reaches 35% of the estimated profit, the
			use of subsequent surplus cash shall be unanimously
			determined by the board of directors of the Target
			Company; and
		(v)	distributed as dividends to the shareholders of the
			Target Company in accordance with the Share
			Transfer and Cooperation Agreement.
		The "Required Fund" refers to the funding needs of the
		Target Project for the development and construction, daily
		operation and management, payment of taxes and levies,
		bank loan repayment and the principal and interests of the
		Financial Assistance that shall be repaid to the Purchaser
		accordingly, each in the forthcoming 90 days.
		For the purpose of "cash flow returned" as referred to in
		(ii) above, the loan from the Target Project to the Non-
		Target Projects/Vendors shall be deemed to be the cash
		flow returned from the Target Project to the Original
		Shareholders of the Target Company.
Other provisions	:	The Share Transfer and Cooperation Agreement also sets
		forth other provisions regulating the parties' relationship
		in relation to the Target Company, including, amongst
		others, deadlock arrangements, profit distribution and
		termination arrangements.

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INFORMATION ABOUT THE PARTIES AND THE TARGET COMPANY

The Company and the Purchaser

The Company is a company incorporated in the Cayman Islands with limited liability, whose shares are listed on the Main Board of the Stock Exchange. It is one of the leading property developers in the PRC with business operations in various major cities in the PRC and is primarily engaged in developing quality properties targeting mainly middle and high income residents in the PRC.

The Purchaser is a company established in the PRC with limited liability and a wholly-owned subsidiary of the Company and is principally engaged in property development.

The Vendors and the Vendors' Parent Company

Each of Zhejiang Yunsheng and Xinhu Real Estate is a company established in the PRC with limited liability and a wholly-owned subsidiary of the Vendors' Parent Company, and is principally engaged in property development in the PRC. The Vendors' Parent Company is a company established in the PRC, whose shares are listed on the Shanghai Stock Exchange. It is primarily engaged in commerce, property and finance in the PRC.

Target Company

The Target Company is a company established in the PRC with limited liability. It was established in 2001 and is primarily engaged in real estate development, property management, building materials and engineering equipment development.

As at the date of this announcement, the Target Company is owned by Zhejiang Yunsheng, Xinhu Real Estate and Shenzhen Donghaichao as to 78%, 20% and 2%, respectively. Upon completion of the Acquisition, the Target Company will be owned by Zhejiang Yunsheng, the Purchaser, Xinhu Real Estate and Shenzhen Donghaichao as to 50%, 35%, 13% and 2%, respectively. The Target Company will not become a subsidiary of the Company upon completion of the Acquisition. The table below sets out certain audited financial information of the Target Company for the years ended 31 December 2017 and 31 December 2018:

For the year ended

31 December

2017 2018

(RMB) (RMB)

'000 '000

Revenue	31,546	77,837
Net profit/loss before taxation	(45,491)	4,412
Net profit/loss after taxation	(36,052)	2,101

The unaudited net asset value of the Target Company as at 31 October 2019 was approximately RMB955,683,000.

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REASONS FOR AND BENEFITS OF THE ACQUISITION

The parties to the Share Transfer and Cooperation Agreement intend that the Acquisition will facilitate the Target Company in furthering development of the Target Project. The Target Project is situated in Putuo District, Shanghai, and forms part of the Pearl City Project that involves the development of residential and commercial buildings and basements. The Target Project is the fourth section of Phase Three of the Pearl City Project that consists of four sections, of which the first to second and third sections were already completed in 2007 and 2015 respectively and have been delivered to the owners. The Board considers that the Acquisition by the Purchaser and the development of the Target Project will offer the Group with the opportunity to further diversify its investment property development business in the PRC and make full use of the advantage of the Vendors' land resources in the Yangtze River Delta as well as its rich development and operation experience in Shanghai. Accordingly, the Board believes that the Acquisition is in line with the Group's long term vision and can broaden the Group's income base and strengthen its financial position.

The terms of the Share Transfer and Cooperation Agreement (including the Share Transfer Consideration and the Financial Assistance contemplated thereunder) were determined by arm's length negotiation among the parties to the Share Transfer and Cooperation Agreement with reference, among other things: (i) fair market value of comparable properties similar to the Target Project in the comparable phase of development; and (ii) the capital requirement for the development, the actual and anticipated project costs and the projected returns of the Target Project.

While pursuant to the Share Transfer and Cooperation Agreement, the Financial Assistance will only be provided by the Purchaser (but not by all shareholders of the Target Company on a pro-rata basis), it is in view of cooperation for the Target Project that the Financial Assistance will be provided to the other shareholders of the Target Company indirectly. The Board considers that, pursuant to the Share Transfer and Cooperation Agreement, the Financial Assistance may also enable the Target Company to settle certain of its liabilities and fund the necessary daily operation and management expenses of the Target Project, thus in the interest of the Group as a shareholder of the Target Company.

In view of the above, the Board considers that the Share Transfer and Cooperation Agreement (including the Share Transfer Consideration and Financial Assistance contemplated thereunder) is on normal commercial terms, fair and reasonable and in the interests of the Company and its Shareholders as a whole.

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LISTING RULES IMPLICATIONS

As one or more of the applicable percentage ratio(s) calculated pursuant to Rule 14.07 of the Listing Rules in respect of the Acquisition (based on the Share Transfer Consideration and Financial Assistance contemplated thereunder) is more than 5% but less than 25%, the transaction constitutes a discloseable transaction for the Company and is subject to the reporting and announcement requirements.

DEFINITIONS

Unless the context otherwise requires, capitalised terms used in this announcement shall have the following meanings:

"Acquisition"	the acquisition of the Target Shares by the Purchaser in
	accordance with the terms and conditions of the Share
	Transfer and Cooperation Agreement
"Board"	the board of Directors
"Company"	Greentown China Holdings Limited (stock code: 03900), a
	company incorporated in the Cayman Islands with limited
	liability, the shares of which are listed on the Main Board of
	the Stock Exchange
"Director(s)"	the director(s) of the Company
"Financial Assistance"	a loan of RMB3,050,000,000 to be provided by the Purchaser
	to the Target Company in accordance with the terms and
	conditions of the Share Transfer and Cooperation Agreement
"Group"	the Company together with its subsidiaries
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock
	Exchange
"Non-Target Projects"	the assets and liabilities and projects of the Target Company
	other than the Target Project, including Phase 1, Phase 2 and
	Section 1-3 of Phase 3 of the Pearl City Project, other assets,
	long term equity investments etc.
"Original Shareholders of	the original shareholders of the Target Company prior to
Target Company"	the Purchaser having become a shareholder of the Target
	Company, namely the Vendors and Shenzhen Donghaichao

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"Phase Three of Pearl	Phase three of the construction project of the Target
City Project"	Company, which is situated in Putuo District, Shanghai in
	the PRC, with a gross construction area of approximately
	464,423.48 sqm
"PRC"	the People's Republic of China (excluding, for the purpose
	of this announcement, the Hong Kong Special Administrative
	Region of the PRC, the Macao Special Administrative
	Region of the PRC and Taiwan)
"Purchaser"	Greentown Real Estate Group Company Limited (綠城房地
	產集團有限公司), a company established in the PRC and a
	wholly-owned subsidiary of the Company
"RMB"	Renminbi, the lawful currency of the PRC
"Share Transfer Consideration"	a consideration of RMB550,000,000 for the acquisition
	of the Target Shares in accordance with the terms and
	conditions of the Share Transfer and Cooperation Agreement
"Share Transfer and	the Share Transfer and Cooperation Agreement dated 17
Cooperation Agreement"	December 2019 entered into among the Purchaser, the
	Vendors, the Target Company and the Vendors' Parent
	Company
"Shareholder(s)"	holder(s) of the share(s) of the Company
"Shenzhen Donghaichao"	Shenzhen Donghaichao Investment Development Co.,
	Ltd . * ( 深圳市東海潮投資發展有限公司), a company
	established in the PRC which holds 2% of the total shares of
	the Target Company as at the date of the Share Transfer and
	Cooperation Agreement
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Target Company" or	Shanghai Xinhu Real Estate Development Co.,Ltd.* (上海新
"Shanghai Xinhu"	湖房地產開發有限公司), a company established in the PRC
"Target Project"	Section 4 of Phase Three of Pearl City Project, with a gross
	construction area of approximately 202,683.40 sqm
"Target Shares"	35% of the total shares of the Target Company as at the date
	of the Share Transfer and Cooperation Agreement
"Vendors"	Zhejiang Yunsheng and Xinhu Real Estate (or, as the case
	may be and where applicable, their respective associates)

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"Vendors' Parent Company"	Xinhu Zhongbao Co.,Ltd. (新湖中寶股份有限公司), a
	company established in the PRC. From public information,
	Xinhu Zhongbao Co., Ltd. is a company listed on the
	Shanghai Stock Exchange (Stock Code: 600208) and
	Mr. Huang Wei is the ultimate controlling shareholder
	thereof. Both Xinhu Zhongbao Co., Ltd. and Mr. Huang
	Wei are independent third party of the Company and its
	connected persons
"Xinhu Real Estate"	Xinhu Real Estate Group Co., Ltd.* (新湖地產集團有限
	公司), a wholly-owned subsidiary of the Vendors' Parent
	Company established in the PRC and an independent third
	party of the Company and its connected persons

"Zhejiang Yunsheng"

• For identification purposes only

Zhejiang Yunsheng Investment Co., Ltd.* (浙江允升投資 集團有限公司), a wholly-owned subsidiary of the Vendors' Parent Company established in the PRC and an independent third party of the Company and its connected persons

By order of the Board

Greentown China Holdings Limited

Zhang Yadong

Chairman

Hangzhou, the PRC

17 December 2019

As at the date of this announcement, the Board comprises Mr ZHANG Yadong, Mr LIU Wensheng, Mr ZHOU Lianying, Mr GUO Jiafeng, Mr GENG Zhongqiang and Mr. LI Jun as executive directors, Mr. Stephen Tin Hoi NG (Mr Andrew On Kiu CHOW as his alternative) as a non-executive director and Mr JIA Shenghua, Mr KE Huanzhang, Mr SZE Tsai Ping, Michael and Mr HUI Wan Fai as independent non-executive directors.

• For identification purpose only

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