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(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 03382) CONNECTED TRANSACTION PURCHASE OF MACHINERY AND HIRE OF SERVICES

The Board announces that on 16 January 2012, First Company, a wholly-owned subsidiary of the Group, entered into the Agreement with Tianjin Port E&M pursuant to which First Company agreed to purchase Machinery and to hire Services of Tianjin Port E&M and Tianjin Port E&M agreed to sell Machinery and to provide Services at the consideration of approximately RMB13.79 million subject to the terms of the Agreement.
Tianjin Port E&M is a wholly-owned subsidiary of Tianjin Port Group (which is a controlling shareholder of the Company), and therefore Tianjin Port E&M is a connected person of the Company as def ined under the Listing Rules. Accordingly, the Transaction constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. As the applicable percentage ratios as def ined in the Listing Rules in respect of the Transaction are more than 0.1% but less than 5%, the Transaction is exempted from the independent shareholders' approval requirements under Rule 14A.48 of the Listing Rules and is only subject to the reporting and announcement requirements as set out in Rules 14A.45 to 14A.47 of the Listing Rules.
On 16 Januar y 2012, First Company, a wholly-owned subsidiar y of the Group, entered into the Agreement with Tianjin Port E&M pursuant to which First Company agreed to purchase Machinery and to hire Services of Tianjin Port E&M and Tianjin Port E&M agreed to sell Machinery and to provide Services at the consideration of approximately RMB13.79 million subject to the terms of the Agreement.

PRINCIPAL TERMS OF THE AGREEMENT Date

16 January 2012
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Parties

(1) Seller/Services provider : Tianjin Port E&M (2) Purchaser : First Company

Assets to be acquired and Services to be hired

Acquisition of one set of 38t-35m portal crane with the provision of installation, relocation of one set of existing 25t-33m portal crane and related services by Tianjin Port E&M.

Consideration

The consideration payable by First Company to Tianjin Port E&M for the Machinery and Services amounts to approximately RMB13.79 million. Such consideration was arrived at through a tender process held by First Company in which Tianjin Port E&M offered the lowest price of approximately RMB13.79 million for the sale of the Machinery (together with the provision of installation and related services) and the provision of the Services.
The consideration shall be paid by instalments in accordance with the progress of the manufacturing work and subject to the delivery, installation, adjustment and f inal examination of the Machinery and the provision of Services. A retention money representing 5% of the total consideration shall be payable within 30 days after the expiry of the warranty period of the Machinery (being 12 months).
It is expected that the above consideration by First Company would be funded by internal resources of the
Group.

REASONS FOR AND BENEFITS OF ENTERING INTO THE AGREEMENT

The pur pose of purchasing the Machinery and hiring the Services is to increase the loading and unloading capacity of the Group and could benef it the Group in terms of long-term investment and improving the overall operating eff iciency.
The Directors (including the independent non-executive Directors) believe that the ter ms of the Agreement are on normal commercial terms, fair and reasonable and the entering into the Agreement is in the interests of the Company and shareholders of the Company as a whole.
None of the Directors had material interest in the Transaction. However, in view of good corporate governance practices, as Mr. Yu Rumin and Mr. Tian Changsong are both directors of the Company and Tianjin Port Group, and Mr. Li Quanyong is a director of the Company and the chief economist of Tianjin Port Group, they had all abstained from voting in the relevant Board resolutions approving the Transaction.
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LISTING RULES IMPLICATIONS

Tianjin Port E&M is a wholly-owned subsidiary of Tianjin Port Group (which is a controlling shareholder of the Company), and therefore Tianjin Port E&M is a connected person of the Company as def ined under the Listing Rules. Accordingly, the Transaction constitutes a connected transaction of the Company under Chapter 14A of the Listing Rules. As the applicable percentage ratios as def ined in the Listing Rules in respect of the Transaction are more than 0.1% but less than 5%, the Transaction is exempted from the independent shareholders' approval requirements under Rule 14A.48 of the Listing Rules and is only subject to the reporting and announcement requirements as set out in Rules 14A.45 to 14A.47 of the Listing Rules.

GENERAL

The Group is principally engaged in containerised and non-containerised cargo handling services at the port of Tianjin, primarily through its subsidiaries and associated companies. In addition, it is also involved in sales and other port auxiliary services at the port of Tianjin in the PRC. First Company is principally engaged in containerised and non-containerised cargo handling services and other port auxiliary services.
Tianjin Port Group is the controlling shareholder of the Company. Its principal business includes port handling and stevedoring services, warehousing, logistics, and port area land development at the port of Tianjin in the PRC primarily through its group companies. Tianjin Port E&M is principally engaged in manufacturing and installation of electrical and mechanical machineries, lifting and transpor t machineries, and pipeline and steel structure project.

DEFINITIONS

In this announcement, unless the context requires otherwise, the following terms shall have the following meanings:
"Agreement" the ag reement dated 16 Januar y 2012 entered into between First Company and Tianjin Port E&M for the acquisition of Machineries and hire of Services by First Company from Tianjin Port E&M, details of which are set out in the section headed "Principal Terms of the Agreement" of this announcement;
"Board" the board of Directors;
"Company" Tianjin Port Development Holdings Limited, a company incorporated in the Cayman Islands with limited liability and the shares of which are listed on the main board of the Stock Exchange;
"Director(s)" the director(s) of the Company;
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"First Company"