Beijing Development (Hong Kong)
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THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser. If you have sold or transferred all your shares in Beijing Development (Hong Kong) Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee. This circular does not constitute an offer of, nor is it calculated to invite offers for, shares or other securities of Beijing Development (Hong Kong) Limited. The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular. BEIJING DEVELOPMENT (HONG KONG) LIMITED (Incorporated in Hong Kong with limited liability) CONNECTED AND SHARE TRANSACTION Independent financial adviser to the Independent Board Committee Watterson Asia Limited A letter from the Board is set out on pages 5 to 13 of this circular. A letter from the Independent Board Committee is set out on page 14 of this circular. A letter from the independent financial adviser, Watterson Asia Limited, containing its advice to the Independent Board Committee is set out on pages 15 to 25 of this circular. A notice convening an extraordinary general meeting of Beijing Development (Hong Kong) Limited to be held at Taishan Room, Level 5, The Island Shangri-La Hong Kong, Pacific Place, Supreme Court Road, Central, Hong Kong at 10: 00 a.m. on Tuesday, 27 May, 2003 is set out on pages 30 to 31 of this circular. Whether or not you are able to attend the meeting in person, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon and deposit the same with Tengis Limited, the share registrar of Beijing Development (Hong Kong) Limited, at G/F, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for holding the meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting or any adjournment thereof should you so wish. 2May,2003 CONTENTS Page DEFINITIONS ....................................................................... 1 LETTER FROM THE BOARD 1. Introduction ................................................................ 5 2. Agreement ................................................................. 6 3. Shareholding structure of Business Net immediately prior to andafterCompletionoftheProposedTransaction .............................. 8 4. InformationonBusinessNet .................................................. 9 5. InformationonBMAC ....................................................... 10 6. ReasonsandbenefitsoftheProposedTransaction ................................ 11 7. Change in Beijing Development’s shareholding structure .......................... 12 8. Listinganddealing .......................................................... 12 9. TheEGM .................................................................. 13 10. Advice ..................................................................... 13 11. General .................................................................... 13 LETTER FROM THE INDEPENDENT BOARD COMMITTEE .......................... 14 LETTER FROM WATTERSON ASIA ................................................. 15 APPENDIX — GENERAL INFORMATION ......................................... 26 NOTICE OF EGM ................................................................... 30 —i— DEFINITIONS In this circular, the following expressions shall have the following meanings unless the context requires otherwise: ‘‘Agreement’’ the conditional sale and purchase agreement dated 14 April, 2003, entered into between Beijing Enterprises and Beijing Development for the acquisition by Beijing Development of the entire issued share capital in and the Shareholder’s Loan due by Business Net ‘‘Announcement’’ the joint announcement dated 14 April, 2003 issued by Beijing Enterprises and Beijing Development in relation to the Proposed Transaction ‘‘associates’’ have the meaning as defined in the Listing Rules ‘‘Beijing Bashi’’ Beijing Bashi Co., Ltd. ( ), an independent third party not connected with any director, chief executive or substantial shareholder of Beijing Development or Beijing Enterprises or any of their respective subsidiaries or an associate of any of them ‘‘Beijing Development’’ Beijing Development (Hong Kong) Limited ( ), a company incorporated in Hong Kong with limited liability, the shares of whicharelistedontheStockExchange ‘‘Beijing Development Beijing Development and its subsidiaries Group’’ ‘‘Beijing Enterprises’’ Beijing Enterprises Holdings Limited ( ), a company incorporated in Hong Kong with limited liability, the shares of which are listed on the Stock Exchange and is the controlling shareholder of Beijing Development interested in 52.44% of its issued share capital as at the Latest Practicable Date ‘‘Beijing Enterprises Beijing Enterprises and its subsidiaries Group’’ ‘‘Beijing Huaxun’’ Beijing Huaxun Group ( ), an independent third party not connected with any director, chief executive or substantial shareholder of Beijing Development or Beijing Enterprises or any of their respective subsidiaries or an associate of any of them ‘‘Beijing Mass Beijing Mass Transportation Corporation ( , Transportation’’ formerly known as ), an independent third party not connected with any director, chief executive or substantial shareholder of Beijing Development or Beijing Enterprises or any of their respective subsidiaries or an associate of any of them ‘‘Beijing Public Beijing Public Transportation Corporation ( ), an Transportation’’ independent third party not connected with any director, chief executive or substantial shareholder of Beijing Development or Beijing Enterprises or any of their respective subsidiaries or an associate of any of them —1— DEFINITIONS ‘‘BETIT’’ Beijing Enterprises Teletron Information Technology Co., Ltd. ( ), a wholly foreign owned enterprise established in the PRC on 20 February, 2001 and a wholly-owned subsidiary of Cyber Vantage ‘‘BMAC’’ Beijing Municipal Administration & Communications Card Co., Ltd. ( ), a sino-foreign equity joint venture company established in the PRC on 23 October, 2000 ‘‘Board’’ board of Directors ‘‘BOE Technology’’ BOE Technology Group Co., Ltd. ( ,formerly known as ), an independent third party not connected with any director, chief executive or substantial shareholder of Beijing Development or Beijing Enterprises or any of their respective subsidiaries or an associate of any of them ‘‘BT Intelligent System’’ Beijing Teletron Intelligent System Co. Ltd. ( ), a company incorporated in the PRC on 1 March, 2000 with limited liability and is owned as to 80% by BETIT ‘‘BT System Integration’’ Beijing Teletron System Integration Co. Ltd. ( ), a company incorporated in the PRC on 2 June, 1998 with limited liability and is owned as to 51% by BETIT ‘‘Business Day’’ any day other than a Saturday, Sunday or a day on which commercial banking institutions in Hong Kong are authorized or obligated by law or executive order to be closed ‘‘Business Net’’ Business Net Limited ( ), a company incorporated in BVI with limited liability on 22 March, 2002 ‘‘BVI’’ the British Virgin Islands ‘‘Completion’’ the completion of the Agreement ‘‘Completion Date’’ the date which is 3 Business Days after the date on which all of the conditions set out in the Agreement have been satisfied or waived by Beijing Development (or such later date as Beijing Enterprises and Beijing Development may agree) ‘‘Consideration’’ the aggregate consideration of HK$40,000,000 payable by Beijing Development to Beijing Enterprises for the acquisition of the Sale Shares and the Shareholder’s Loan ‘‘Consideration Shares’’ the aggregate of 35,000,000 new Shares to be allotted and issued to Beijing Enterprises upon Completion ‘‘Cyber Vantage’’ Cyber Vantage Group Limited ( ), a company incorporated in BVI with limited liability and is wholly-owned by Beijing Development —2— DEFINITIONS ‘‘Director(s)’’ the director(s) of Beijing Development ‘‘EGM’’ the extraordinary general meeting of Beijing Development to be convened for approving the Proposed Transaction ‘‘Enlarged Group’’ Beijing Development Group as enlarged by 100% interest in Business Net ‘‘Hong Kong’’ the Hong Kong Special Administrative Region of the PRC ‘‘IFTL’’ Idata Finance Trading Limited, a company incorporated in the BVI and a direct wholly-owned subsidiary of Beijing Enterprises ‘‘Independent Board independent committee of the Board consisting of Mr. Cao Guixing and Mr. Committee’’ Feng Ching Yeng, Frank appointed by the Board of Beijing Development to advise the Independent Shareholders in respect of the Proposed Transaction ‘‘Independent the Shareholder(s) other than Beijing Enterprises and its associates Shareholder(s)’’ ‘‘IC Card(s)’’ the integrated circuit card(s), which refer(s) to any plastic card with one or more embedded integrated circuit