REG - SDIC Power Holdings - Results of Issuance and Changes in Capital Stock

SDIC Power Holdings CoAnnouncement

10/12/2021 10:40

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RNS Number : 2853V  SDIC Power Holdings Co., LTD  10 December 2021

 

SDIC Power Holdings Co., LTD.

Announcement on the Results of Non-public Issuance of Stocks and Changes in
Capital Stock

 

Important notes:

1. Issuance quantity and price

Type of stock: RMB common stock (A shares)

Issuance quantity: 488,306,450 shares

Issuance price: RMB 7.44/share

2. Subscription quantity and restricted stock trade period of the issuance
object

SDIC Power Holdings Co., LTD. (hereinafter referred to as "the Company" or
"SDIC Power") privately issued A shares to State Development & Investment
Corp., Ltd. (hereinafter referred to as "SDIC") this time, with a subscription
number of 488,306,450 shares and a lock-up period of 36 months from the date
of completing the share registration formalities.

3. Estimated time to market

The newly issued shares have been registered in Shanghai Branch of China
Securities Depository and Clearing Corporation Limited on Dec 9th, 2021. The
newly added shares of the Company shall not be transferred within 36 months
from the date of completing the share registration formalities, and the
expected listing and circulation time shall be the next trading day after the
expiration of the restricted stock trade period.

4. Transfer of assets

All the shares issued this time are subscribed in cash, without involving the
transfer of assets.

I. Basic Information of This Issuance

1. Relevant procedures for the performance of this issuance

(1) Deliberated and adopted by the Board of Directors

On July 19, 2021, the Company held the 30th session of the 11th Board of
Directors to deliberate and adopt the relevant proposals for this non-public
issuance of stocks.

(2) Deliberated and adopted by the Shareholders' Meeting

On August 4, 2021, the Company held the sixth Extraordinary Shareholders'
Meeting in 2021, deliberated and adopted various proposals related to this
non-public issuance of A shares, and authorized the Board of Directors to
handle all matters related to this non-public issuance of A shares.

(3) The approval process of the regulatory authorities for the performance of
this issuance

1) SDIC issued the Approval on Matters Concerning the Non-public Issuance of A
Shares by SDIC Power Holdings Co., LTD. (GTZL  2021  No. 201) to the Company
on July 24, 2021.

2) The Issuance Examination Committee of the China Securities Regulatory
Commission (hereinafter referred to as the "CSRC") deliberated and adopted the
application for this non-public issuance of A shares by the Company on October
18, 2021.

3) CSRC issued the Reply to SDIC Power Holdings Co., LTD. on the Approval of
its Non-public Issuance of Stocks (ZJXK  2021  No. 3410) on October 29, 2021.

2. This issuance

(1) Type of issued stock: RMB common stock (A shares)

(2) Issuance quantity: 488,306,450 shares

(3) Issuance price: RMB 7.44/share

(4) Total raised funds: RMB 3,632,999,988.00

(5) Issuance cost: RMB 2,976,232.50 (excluding tax)

(6) Net raised funds: RMB 3,629,845,181.56

(7) Joint sponsor institutions (joint lead underwriters): CITIC Securities
Co., Ltd. (hereinafter referred to as "CITICS") and Essence Securities Co.,
Ltd. (hereinafter referred to as "Essence Securities")

3. Capital verification of raised funds and share registration

According to the Verification Report issued by BDO China Shu Lun Pan Certified
Public Accountants LLP on November 25, 2021 (XKSBZ  2021  No. ZG11947), as of
November 25, 2021, CITICS had received a total of RMB 3,632,999,988.00 of
subscription funds paid to the special payment account opened by CITICS for
this non-public issuance of SDIC Power.

On November 26, 2021, CITICS transferred the remaining amount of the above
subscription funds after deducting the sponsorship fee and underwriting fee of
the sponsor institution to the account designated by the issuer. According to
the Verification Report issued by BDO China Shu Lun Pan Certified Public
Accountants LLP on November 26, 2021 (XKSBZ  2021  No. ZG11946), as of 13:00
on November 26, 2021, there were total raised funds of RMB 3,632,999,988.00
for SDIC Power's non-public issuance of stocks. After deducting sponsorship
and underwriting fees and intermediary fees paid by SDIC Power, totaling RMB
3,154,806.44 including tax, the net amount of actually raised funds is RMB
3,629,845,181.56, plus the deductible VAT input tax of RMB 178,573.94 for this
issuance fee, totaling RMB 3,630,023,755.50, including the newly added
registered capital (capital stock) of RMB 488,306,450.00, which is included in
the capital reserve of RMB 3,141,717,305.50.

The registration and custody procedures for the newly issued shares of the
Company were completed in Shanghai Branch of China Securities Depository and
Clearing Corporation Limited on Dec 9th, 2021.

4. Concluding comments of the joint sponsor institution (joint lead
underwriter) and law firm on the non-public issuance process and the
compliance of the subscriber

(1) Concluding comments of the joint sponsor institution (joint lead
underwriter) on the pricing process of this issuance and the compliance of the
issuer

As verified, the Joint Sponsor (joint lead underwriter) concludes that: "The
process of the issuer privately issuing A shares this time is completely
compliant with the Company Law, Securities Law, Administrative Measures for
the Issuance of Securities by Listed Companies, Measures for the
Administration of Securities Issuance and Underwriting, Detailed
Implementation Rules for the Non-public Issuance of Stocks by Listed Companies
and other relevant laws and regulations, Reply to SDIC Power Holdings Co.,
LTD. on the Approval of its Non-pubic Issuance of Stocks (ZJXK  2021  No.
3410) issued by CSRC, the issuer's requirements of internal decision-making
procedures and requirements specified in the Issuance Plan submitted to CSRC
by the joint sponsor (joint lead underwriter) before the launch of non-public
issuance."

As verified, the joint sponsor (joint lead underwriter) concludes that: "The
issuer determines target subscribers in fair and just manners, consistent with
the interests of the Company and all its shareholders, and in line with the
Administrative Measures for the Issuance of Securities by Listed Companies,
Measures for the Administration of Securities Issuance and Underwriting and
other relevant laws and regulations as well as requirements specified in the
Issuance Plan submitted to CSRC by the joint sponsor (joint lead underwriter)
before the launch of non-public issuance." The target subscriber of this
non-public issuance is not a privately offered investment fund as specified in
the Securities Investment Fund Law of the People's Republic of China, Trial
Measures for Fund Management Companies to Provide Asset Management Services
for Specific Clients, the Interim Measures for the Supervision and
Administration of Privately Offered Investment Funds and the Measures for the
Registration of Privately Offered Investment Fund Management Institutions and
Fund Recordation (for Trial Implementation) and thus subject to no
registration procedures for privately offered investment funds. Legal
self-owned or self-raised funds are used for the subscription of the
non-public issuance of A shares. No leverage financing structured portfolio is
involved in the final contribution. No funds come directly or indirectly from
the Issuer and its related parties."

The issuer has abode by the principles of fairness and justice in the issuance
process and the selection of target subscribers regarding this non-public
issuance of stocks, which are in line with the interests of the listed company
and all shareholders.

(2) The concluding comments of the issuer's lawyer on the compliance of the
issuance process and the subscriber

Beijing Guantao Law Firm, the Issuer's Lawyer concludes that:

1. this issuance of SDIC Power has been necessarily approved and authorized,
and checked and approved by CSRC. Such approval, authorization and check are
legal and effective.

2. The subscriber of this issuance, the issuance price and issuance quantity
are in line with Administrative Measures for the Issuance of Securities by
Listed Companies, Detailed Implementation Rules for the Non-public Issuance of
Stocks by Listed Companies and other relevant laws, regulations and normative
documents, the relevant requirements of this issuance plan deliberated and
adopted by the issuer's Shareholders' Meeting, and the approval scope of the
Reply to SDIC Power Holdings Co., LTD. on the Approval of its Non-public
Issuance of Stocks (ZJXK  2021  No. 3410).

3. this issuance process of SDIC Power, the Payment Notice, the Share
Subscription Agreement with Entry-into-force Conditions and other legal
documents are legal and valid, and comply with the relevant provisions of
relevant laws, regulations and normative documents such as the Administrative
Measures for the Issuance of Securities by Listed Companies and the Detailed
Implementation Rules for the Non-public Issuance of Stocks by Listed
Companies, with fair and just issuance results.

II. Introduction to Issuance Results and Issuer

1. Issuance results

this issuance price is RMB 7.44/share, with 488,306,450 shares issued and the
total raised funds of RMB 3,632,999,988.00.

The Company privately issued A shares to SDIC this time.

2. Basic information of the issuer

 Name                        State Development & Investment Corp., Ltd.
 Type of enterprise          Limited liability company (wholly state-owned)
 Domicile                    International Investment Plaza, No. 6-6, Fuchengmen North Street, Xicheng
                             District, Beijing
 Legal representative        Bai Tao
 Registered capital          RMB 33.8 billion
 Unified Social Credit Code  91110000100017643K
 Business scope              Operating state-owned assets within the scope authorized by the State Council
                             and developing investment related businesses; investment and investment
                             management in energy, transportation, fertilizers, high-tech industries,
                             financial services, consulting, guarantees, trade, biomass energy, elderly
                             care industry, big data, healthcare, inspection and testing; assets
                             management; economic information consultation; technology development and
                             technical services. (The enterprise may lawfully and independently choose
                             business projects and carry out business activities; Business activities
                             subject to approval in accordance with law shall be only operated as approved
                             and after the approval by competent authority; the Company shall not engage in
                             any business activity under an item prohibited or restricted by the industrial
                             policies of Beijing City.)

The number of shares subscribed this time is 488,306,450, with the restricted
stock trade period of 36 months from the date of completion of share
registration procedures.

III. Changes in the Top Ten Shareholders of the Company Before and After this
issuance

this issuance will not lead to any change in the control rights of the
Company.

1. The top ten shareholders of the Company before this issuance

As of September 30, 2021, the shareholding of the top ten shareholders of the
Company is as follows:

 S/N  Name of shareholder                                                             Nature of shareholders   Shareholding quantity (share)  Shareholding ratio (%)
 1    State Development & Investment Corp., Ltd.                                      State-owned corporation  3,337,136,589                  47.91
 2    China Yangtze Power Co., Ltd.                                                   State-owned corporation  1,038,080,914                  14.90
 3    China Securities Finance Corporation Limited                                    State-owned corporation  203,657,917                    2.92
 4    China Yangtze Power Investment Management Co., Ltd.                             State-owned corporation  154,638,975                    2.22
 5    Hong Kong Securities Clearing Co., Ltd.                                         Foreign legal person     103,653,045                    1.49
 6    Citibank, National Association                                                  Foreign legal person     82,463,040                     1.18
 7    Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Juzhi   unknown                  75,687,364                     1.09
      Fund
 8    Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Caizhi  unknown                  70,460,137                     1.01
      Fund
 9    National Social Security Fund Portfolio 109                                     unknown                  63,471,635                     0.91
 10   Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Huizhi  unknown                  54,988,628                     0.79
      Fund
 Total                                                                                                         5,184,238,244                  74.42

2. The top ten shareholders of the Company after this issuance

After the completion of this issuance, the top ten shareholders of the Company
are as follows:

 S/N  Name of shareholder                                                             Nature of shareholders   Shareholding quantity (share)  Shareholding ratio (%)
 1    State Development & Investment Corp., Ltd.                                      State-owned corporation  3,825,443,039                  51.32
 2    China Yangtze Power Co., Ltd.                                                   State-owned corporation  1,038,080,914                  13.93
 3    China Securities Finance Corporation Limited                                    State-owned corporation  203,657,917                    2.73
 4    China Yangtze Power Investment Management Co., Ltd.                             State-owned corporation   184,572,381                   2.48
 5    Hong Kong Securities Clearing Co., Ltd.                                         Foreign legal person      110,620,215                   1.48
 6    Citibank, National Association                                                  Foreign legal person     82,463,040                     1.11
 7    Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Juzhi   unknown                  75,687,364                     1.02
      Fund
 8    Shanghai Chongyang Strategic Investment Co., Ltd. - Chongyang Strategic Huizhi  unknown                   54,988,628                    0.74
      Fund
 9    National Social Security Fund Portfolio 109                                     unknown                   53,886,135                    0.72
 10   Gong Youhua                                                                     Domestic Natural person   49,755,073                    0.67
 Total                                                                                                         5,679,154,706                  76.19

IV. Changes in the Company's Capital Stock Structure Before and After this
issuance

Changes in the Company's capital stock structure before and after this
issuance are as follows:

 Item                                           Before this issuance                               This change                After this issuance
                                                Number of shares (shares)  Shareholding ratio (%)  Number of shares (shares)  Number of shares (shares)  Shareholding ratio (%)
 Tradable shares with restrictions for sale     -                          -                       488,306,450                488,306,450                6.55
 Tradable shares without restrictions for sale  6,965,873,347              100.00                  -                          6,965,873,347              93.45
 Total number of shares                         6,965,873,347              100.00                  488,306,450                7,454,179,797              100.00

V. Management Discussion and Analysis

1. The impact on the Company's capital stock structure

After the registration of new shares issued in this non-public issuance is
completed, the Company will increase 488,306,450 tradable shares with
restrictions for sale. In the meantime, this issuance will not lead to changes
in the control rights of the Company. SDIC is still the controlling
shareholder of the Company, while the State-owned Assets Supervision and
Administration Commission of the State Council is still the actual controller
of the Company. After the completion of this non-public issuance, the
Company's equity distribution meets the listing conditions stipulated in the
Listing Rules of Shanghai Stock Exchange.

2. The impact on the Company's asset structure

After the funds raised in this issuance are in place, the total assets and net
assets of the Company will increase at the same time, while the
asset-liability ratio will decrease. After this issuance, the Company will see
better overall financial strength and debt solvency, better capital structure
and better assurance of further development.

3. The impact on the Company's business structure

The funds raised in this issuance will be used to construct Lianghekou
Hydropower Station Project in Yalong River, Sichuan Province and supplement
working capitals, which will enhance the Company's overall strength and
financial strength. As with more working capitals, the Company will have a
lower asset-liability ratio and better financial structure. As a result, the
Company will be confronted with less financial risks and able to assure
sustainable development. After the completion of this issuance, there will be
no drastic change in the Company's main business scope and business income
structure.

4. The impact on corporate governance structure

After the completion of this issuance, there will be a corresponding increase
in the Company's capital stock and corresponding changes in the shareholding
ratio of shareholders. There is no change in controlling shareholder and
actual controller of the Company, and the directors and senior managers will
remain stable, which will not affect the stability and effectiveness of the
original corporate governance structure. The Company will continue to
strengthen and improve the corporate governance structure of the Company.

5. The impact on the structure of the Company's executives

this issuance will not have a significant impact on the structure of
executives. Where the Company intends to adjust the structure of executives,
necessary legal procedures and information disclosure obligations will be
performed as per relevant regulations.

6. The impact of this issuance on horizontal competition and related party
transactions

Upon completion of this issuance, there will be no change in either the
business relationship, related party relationships or horizontal competition
between the Company and its controlling shareholder, actual controller and
their related parties. There will be no horizontal competition between the
Company and its controlling shareholder, actual controller and their related
parties as a result.

In case of related party transactions required for normal operations in the
future, the Company will determine the transaction price in a fair, equitable
and just manner under the principles of marketization in accordance with the
applicable laws and regulations and the Articles of Association, and perform
necessary approval and disclosure procedures.

 

Board of Directors of SDIC Power Holdings Co., LTD.

December 10th, 2021

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