China Coal bed methane (08270.HK) announced that on December 2, 2021, Guangxi Lianfu Business Services Co., Ltd. (seller A, a wholly-owned subsidiary of the company) and Sun Guilan (seller B) entered into a conditional sale and purchase agreement with the buyer Guangxi Tongzhou holding Co., Ltd., according to which the buyer agreed to acquire 100% equity interest in Guangxi Beiliu Gas Co., Ltd. The cash consideration is RMB 80 million (which can be adjusted).
Before completion, the target company is owned by seller An and seller B by 97.5% and 2.5% respectively. Upon completion, the Group will no longer hold any interest in the target company.
The target company is a limited company established in China, mainly engaged in selling pipeline natural gas and providing gas connection services in Beiliu City, Guangxi Province, China.
The board of directors is of the view that the future operation of the target company is not optimistic, and the sale of Beiliu company will enhance the financial situation of the group and bring more cash flow.