CHINA AGRI PROD 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.
CHINA AGRI-PRODUCTS EXCHANGE LIMITED(Incorporated in Bermuda with limited liability) (Stock Code: 0149)
ANNOUNCEMENT CHANGE OF USE OF PROCEEDS
The Board announces that it has decided to change the allocation of the use of the net proceeds from the
Rights Issue as more particularly set out in this announcement.
Reference is made to the announcement dated 24 March 2014 of China Agri-Products Exchange Limited (the "Company", and together with its subsidiaries, the "Group") and its prospectus dated 3 March 2014 (the "Prospectus") in relation to the Rights Issue. Capitalised terms used in this announcement have the same meanings as defined in the Prospectus unless otherwise stated.
The Rights Issue completed in March 2014. As stated in the Prospectus, the net proceeds of approximately
HK$495.5 million (the "Proceeds") raised from the Rights Issue were intended to be utilised as follows:
(i) approximately HK$450 million would be utilised for the development of existing and future agricultural produce exchange projects, (a) of which approximately HK$300 million would be utilised for the acquisitions of land in the PRC; and (b) approximately HK$150 million would be utilised for the payments of construction costs of the agricultural produce exchanges in the PRC (of which (1) approximately HK$130 million was intended for the Kaifeng City project; and (2) approximately HK$20 million was intended for the Yulin City project); and
(ii) the remaining balance of approximately HK$45.5 million would be utilised for general working capital of the Group.
As at the date of this announcement, approximately HK$54.4 million, approximately HK$114.2 million and approximately HK$45.5 million have been applied for the acquisitions of land, the payments of construction costs for the Kaifeng City project and the general working capital of the Group, respectively.
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Since completion of the Rights Issue, the Board has noted that the listing of lands by the PRC governmental authorities for auction in the second quarter of 2014 has been slower than expected, and this has resulted in a decrease in the number of suitable sites available to the Group for acquisition. In addition, the Group has been able to secure alternative suitable financing on commercially acceptable terms to fund the Yulin City project.
In light of these recent developments, the Board considers it to be in the interests of the Company and the Shareholders as a whole to reallocate part of the unutilised Proceeds ear-marked for acquisition of lands in the PRC and the Yulin City project to other agricultural produce exchange projects currently being developed by the Company, which is also the principal purpose for which the Proceeds were raised under the Rights Issue. The actual use and the proposed reallocation of the Proceeds are illustrated as follows:-
(i) Acquisition of PRC land 300 130 54.4 (ii) Project in Kaifeng City, the PRC 130 130 114.2 (iii) Project in Yulin City, the PRC 20 0 0 (iv) Project in Qinzhou City, the PRC - 55 0 (v) Project in Huaian City, the PRC - 70 0 (vi) Project in Panjin City, the PRC - 65 0
By Order of the Board
CHINA AGRI-PRODUCTS EXCHANGE LIMITED Chan Chun Hong, ThomasChairman and Chief Executive Officer
Hong Kong, 11 July 2014
As at the date of this announcement, the executive directors of the Company are Mr. Chan Chun Hong, Thomas, Mr. Leung Sui Wah, Raymond and Mr. Yau Yuk Shing and the independent non-executive directors of the Company are Mr. Ng Yat Cheung, Ms. Lam Ka Jen, Katherine and Mr. Lau King Lung.
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