19 March 2018, China Merchants Port Holdings Company Limited (“CMPort” or “the Company”) held an extraordinary general meeting of the shareholders (the “EGM”) for the purpose of voting on the resolutions regarding the disposal of Shenzhen Chiwan Wharf Holdings Limited (“Chiwan Wharf”) and the acquisition of the Port of Newcastle in Australia. The meeting was hosted by Mr. Bai Jingtao, Managing Director of CMPort, Mr. Zheng Shaoping, Executive Director and Deputy General Manager, other Non-executive Directors and representatives of Shareholders also attended the meeting.
With more than 90% of the votes were cast in favor of both resolutions, the resolutions proposed at the EGM were duly passed as ordinary resolutions.
Mr. Bai Jingtao was interviewed by media after the EGM, he said, “CMPort is striving to be a world’s leading comprehensive port service provider, and will implement its future development strategies by balancing quality, efficiency and scale. We will follow the principle of high quality development, with the consideration of quality and efficiency while conducting appropriate scale expansion, and to make decisions on acquisition and disposal of assets. We always adhere to the goal of maximizing shareholder interests and create more benefits and value for our shareholders.”
The disposal of Chiwan Wharf to resolve non-compete undertaking
The considerations for the disposal of Chiwan Wharf are RMB25.47 per A share and HK$13.35 per B share, respectively. After the completion of the disposal, CMPort will recognise a disposal gain of HK$3.88 billion, including its share of profits of HK$1.06 billion from China Nanshan Development (Group) Incorporation simultaneously. The disposal of Chiwan Wharf is an important first step for CMPort to honour the non-compete undertaking issued on 17 September 2012. Going forward, China Merchants Group also intends to hold its interest in CMPort through Chiwan Wharf, thereby completely resolving the competition issue for Chiwan Wharf. In addition, the Company recognise that it is currently a good timing for CMPort to unlock the value of its investment in Chiwan Wharf. CMPort will improve investment returns and create shareholder value in the future by investing in other high-quality overseas projects.
The acquisition of Port of Newcastle to achieve synergic development
The total consideration for the acquisition of Port of Newcastle is AUD607.5 million (equivalent to approximately HK$3,809 million), including the acquisition of 50% equity interest in Port of Newcastle of AUD445 million and shareholder loans of AUD162.5 million. The Port of Newcastle is the world’s largest coal export port and also the largest port on the east coast of Australia, with 21 berths and a total land area of 7.92 square kilometers. The acquisition of Port of Newcastle in Australia is the first step taken by CMPort to invest in Oceania, and will potentially complement the current trading network under the Company’s port portfolio with furthersynergy and help realise further "Port and Park" development under “Port-Park-City” (“PPC”) model. CMPort believes the acquisition will generate positive long-term financial returns to the Company.
