Sansheng : Announcements and Notices - Major Transaction in Relation to Provision of Financial Assistance

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Sansheng Holdings (Group) Co. Ltd.

三 盛 控 股（ 集 團 ）有 限 公 司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 2183)

MAJOR TRANSACTION IN RELATION TO

PROVISION OF FINANCIAL ASSISTANCE

BACKGROUND

Reference is made to the announcement of the Company dated 17 August 2017 in relation to the Acquisition.

On 16 August 2017 (after trading hours), the Purchaser (a direct wholly-owned subsidiary of the Company) entered into the Agreement to acquire 90% of the issued share capital of the Target Company from the Vendor for the consideration of RMB549,400,000 (equivalent to approximately HK$642,798,000). Completion is subject to the fulfilment of the conditions precedent including, inter alia, the ProjectCo Acquisition having been completed.

Pursuant to the Agreement, the Purchaser also conditionally agreed to procure the Lender to provide the Loan to the NewCo in the principal amount of RMB890,600,000 (equivalent to approximately HK$1,042,002,000) for the sole purpose of satisfying the consideration of the ProjectCo Acquisition.

PROVISION OF FINANCIAL ASSISTANCE

On 8 September 2017 (after the trading hours), the Lender, the NewCo and the Guarantors entered into the Loan Agreement in respect of the provision of the Loan for the sole purpose of satisfying the consideration of the ProjectCo Acquisition.

IMPLICATION OF THE LISTING RULES

As one of the percentage ratios in respect of the provision of the Loan exceeds 25%, it constitutes a major transaction for the Company under the Listing Rules, which requires reporting, announcement and Shareholders' approval. As no Shareholder has any material interest in the provision of the Loan, no Shareholder is required to abstain from voting if the Company were to convene an extraordinary general meeting to approve the Loan Agreement. The Company will obtain written Shareholders' approval from Mega Regal Limited, the controlling Shareholders holding 74.82% of the issued share capital of the Company as at the date of this announcement. No extraordinary general meeting of the Company will be convened by the Company to approve the Loan Agreement and the transactions contemplated thereunder.

A circular containing, among others, (i) the further details of the Loan Agreement; (ii) the financial information of the Group; and (iii) other information as required under the Listing Rules is expected to be despatched on or before 25 September 2017.

BACKGROUND

Reference is made to the announcement of the Company dated 17 August 2017 in relation to the Acquisition.

On 16 August 2017 (after trading hours), the Purchaser (a direct wholly-owned subsidiary of the Company) entered into the Agreement to acquire 90% of the issued share capital of the Target Company from the Vendor for the consideration of RMB549,400,000 (equivalent to approximately HK$642,798,000). Completion is subject to the fulfilment of the conditions precedent including, inter alia, the ProjectCo Acquisition having been completed.

Pursuant to the Agreement, the Purchaser also conditionally agreed to procure the Lender to provide the Loan to the NewCo in the principal amount of RMB890,600,000(equivalent to approximately HK$1,042,002,000) for the sole purpose of satisfying the consideration of the ProjectCo Acquisition.

PROVISION OF FINANCIAL ASSISTANCE

On 8 September 2017 (after the trading hours of the Stock Exchange), the Lender, the NewCo and the Guarantors entered into the Loan Agreement in respect of the provision of the Loan, which is for the sole purpose of satisfying the consideration of the ProjectCo Acquisition. Details of the Loan Agreement are set out as below.

Date:

8 September 2017

Parties:

Lendor: Fuzhou Shangsheng Development Limited* (福州上盛投資有限公

司), a direct wholly-owned subsidiary of the Company;

NewCo: Fuzhou ZhongSheng Weiye Investment Company Limited* (福州

中盛偉業投資有限責任公司), a direct wholly-owned subsidiary of

the Target Company

Guarantors: (1) Mr. Wang Peng, the Vendor, who holds 100% of the issued

share capital of the Target Company; who guarantees the performance of NewCo's obligations under the Agreement

(2) Mr. Wang Yan Ping, the father of Mr. Wang Peng; who guarantees the performance of NewCo's obligations under the Agreement

To the best of the Director's knowledge, information and belief, having made all reasonable enquiries, the NewCo and its ultimate beneficial owner, and the Guarantors are third parties independent of the Company and its connected persons.

Terms of the Loan

Pursuant to the Loan Agreement, the Loan is in the principal amount of RMB890,600,000 (equivalent to approximately HK$1,042,002,000) with a term from the date of the Loan Agreement to 5 September 2018.

It bears no interest and is secured by the pledge of the 100% equity interest in the NewCo and the 100% equity interest in the ProjectCo in favor of the Lender.

The Loan shall be solely used for satisfying the consideration of the ProjectCo Acquisition, details of which is set out in the section headed ''Information of the Lender and the NewCo''.

INFORMATION OF THE LENDER AND THE NEWCO

The Lender

The Lender is a company incorporated in the PRC with limited liability and a direct wholly- owned subsidiary of the Company. It is principally engaged in property investment and property development in the PRC.

The NewCo

As disclosed in the Announcement, it is one of the conditions precedent to the Agreement that the Target Company shall establish a wholly-owned subsidiary, the NewCo, in the PRC with registered capital of RMB500,000,000 for the purpose of acquiring the ProjectCo, which principal assets are two parcels of land with an aggregate area of 197,622.41 sqm for residential and commercial use located in Pingtan County, Fujian Province, the PRC.

On 17 August 2017, NewCo was established with the scope of business involving property investment and property development. Set out below is the group structure of the Target Group as at the date of this announcement:

Target Company

100%

NewCo

As disclosed in the Announcement, the consideration and the relevant tax expenses of the ProjectCo Acquisition are estimated to be RMB890,600,000 (equivalent to approximately HK$1,042,002,000), which will be financed by the Loan.

REASONS FOR AND BENEFITS OF FINANCIAL PROVISION

The Company is an investment holding company and its subsidiaries are principally engaged in property development and property investment.

The Loan is solely for the purpose of satisfying the consideration and the relevant tax expenses of the ProjectCo Acquisition of approximately RMB890,600,000 (equivalent to approximately HK$1,042,002,000). Completion of the ProjectCo Acquisition is one of the conditions precedents to the Acquisition and therefore provision of the Loan is to facilitate the Acquisition, which as disclosed in the Announcement, is considered by the Board to be a prime opportunity for the Group to increase its presence in the PRC property market and to leverage on its experience in property development to enhance its existing business. The Directors consider that the provision of the Loan is in the interests of the Company and the Shareholders as a whole.

The Loan shall be financed by way of the revolving facility of RMB3,000,000,000

(equivalent to approximately HK$3,510,000,000) provided by Fuzhou Sansheng Investment Limited* (福州三盛投資有限公司), which is beneficially owned as to 80% by Fujian Zesheng Investment Advisory Limited Liability Company* (福建澤盛投資諮詢有限責任公

司) (which is in turn owned as to 95% by Mr. Lin Rongbin (being the controlling Shareholder and an executive Director) and 5% by Ms. Cheng Xuan (being an executive

Director and the spouse of Mr. Lin Rongbin)) and 20% by Ms. Cheng Xuan.