Guohua (00370) issued an announcement. On the date of this announcement, Guohua Construction (an indirect wholly-owned subsidiary of the company) has agreed...
According to the Zhitong Finance App, Guohua (00370) announced that on the date of this announcement, Guohua Construction (an indirect wholly-owned subsidiary of the company) has paid a deposit of RMB 5 million to the target company Huaxiang (Guangdong) Urban Construction and Development Co., Ltd. in accordance with the cooperation agreement. The deposit was funded by Beijing Yachen in accordance with the Yachen Cooperation Agreement, and 30% of the target company's shares have been transferred to Guohua Construction Industry. The target company has yet to enter into a project agreement and has not been successfully appointed as the designated contracting entity for the project.
On November 22, 2023: (1) CNOOC Guangdong, Guohua Jianye and Zhongjing Tianyuan entered into a termination agreement, according to which the contracting parties agree (which includes) (i) termination of the cooperation agreement, effective from November 22, 2023; (ii) a total of approximately RMB 4.5 million (that is, the deposit amount reduces expenses already incurred in the normal course of the project's business, and the final amount is subject to confirmation by the contracting party) shall be returned to Guohua Jianye; and (iii) Guohua Construction shall return 30% of its shares in the target company to CNOC Guangdong; and
(2) Guohua Jianye and Beijing Yachen entered into a termination agreement. The parties agree (which includes) (i) the termination of the Archen Cooperation Agreement, effective November 22, 2023; and (ii) all refunds received by Guohua Jianye under the termination agreement shall be refunded to Beijing Yachen. However, if Guohua Jianye fails to recover any refunds from China Hainan Airlines Guangdong for reasons other than Guohua Construction, Beijing Yachen has no right to recover such unrecovered amounts from Guohua Jianye.
By entering into cooperation agreements and Arachen cooperation agreements, it is anticipated that the Group will generate revenue by providing project development and management services for the project. After considering China's policy concerns, current market conditions, and uncertainty about the project's progress, the board believes that in the foreseeable future, the project may not require the Group's services. Therefore, the Board of Directors believes that the termination of the agreement and the termination arrangements under the Arachen termination agreement are fair and reasonable and conform to the overall interests of the company and shareholders, and will not have a significant adverse impact on the Group's business, operations and financial position.