Offer Document – for Convenience Purposes Only]
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[Translation of the German Offer Document – for convenience purposes only] OFFER DOCUMENT Voluntary public takeover offer for purchasing securities pursuant to Sections 29 et seqq. of the German Securities Acquisition and Takeover Act (cash offer) by AVIC International Engineering Holdings Pte. Ltd. 10 Collyer Quay # 27-00 Ocean Financial Centre Singapore (049315) and Europe Project Management Pte. Ltd. 10 Collyer Quay #27-00 Ocean Financial Centre Singapore (049315) and Europe Technology Investment Pte. Ltd. 10 Collyer Quay #27-00 Ocean Financial Centre Singapore (049315) and Europe Engineering Holdings Pte. Ltd. 10 Collyer Quay #27-00 Ocean Financial Centre Singapore (049315) to the shareholders of KHD Humboldt Wedag International AG Colonia-Allee 3, 51067 Cologne, Germany to acquire all no-par value ordinary bearer shares in KHD Humboldt Wedag International AG against a cash payment in the amount of EUR 6.45 per share Acceptance period: from 21 November 2013 to 19 December 2013, 24:00 KHD Shares: ISIN DE0006578008 (WKN 657800) Tendered KHD Shares: ISIN DE000A1YDES4 (WKN A1Y DES) Subsequently tendered KHD Shares: ISIN DE000A1YDET2 (WKN A1Y DET) Mandatory publication pursuant to Sections 34 and 14, para. 2 and 3 of the German Securities Acquisition and Takeover Act (WpÜG). No further documents form part of the Offer Document. Shareholders of KHD Humboldt Wedag International AG, in particular those who have residence, registered office or customary abode outside of the Federal Republic of Germany should pay particular attention to the statements under Sections 1.4 and 1.5 of this Offer Document. 1 [Translation of the German Offer Document – for convenience purposes only] CONTENTS CLAUSE PAGE 1. GENERAL INFORMATION ...........................................................................................5 1.1 Legal basis of the Takeover Offer ...............................................................................5 1.2 Publication of the decision to launch the Takeover Offer................................................6 1.3 Review of the Offer Document by the German Federal Financial Supervisory Authority .....6 1.4 Publication and distribution of the Offer Document .......................................................6 1.5 Acceptance of the Offer outside of the Federal Republic of Germany ...............................7 2. INFORMATION REGARDING THE STATEMENTS CONTAINED IN THIS OFFER DOCUMENT ...7 2.1 General...................................................................................................................7 2.2 Status and sources of the information contained in the Offer Document ..........................7 2.3 Forward-looking statements and intentions .................................................................8 2.4 No updates..............................................................................................................8 3. SUMMARY OF THE TAKEOVER OFFER ..........................................................................8 4. TAKEOVER OFFER .................................................................................................. 11 4.1 Subject Matter of the Takeover Offer ........................................................................ 11 4.2 Offer Price............................................................................................................. 12 4.3 Start and End of the Acceptance Period..................................................................... 12 4.4 Possible Extension of the Acceptance Period .............................................................. 12 4.5 Additional Acceptance Period pursuant to Section 16, para. 2 WpüG ............................. 13 5. DESCRIPTION OF THE BIDDERS AND PERSONS ACTING IN CONCERT WITH THE BIDDERS13 5.1 Legal basis and capital structure of the Bidders.......................................................... 13 5.2 Corporate structure of the Bidders............................................................................ 15 5.3 Background information on the Bidders..................................................................... 17 5.4 Share Purchase Agreements .................................................................................... 18 5.5 Voting Agreement .................................................................................................. 19 5.6 Option Agreements ................................................................................................ 19 5.7 Persons Acting in Concert with the Bidders ................................................................ 20 5.8 Shares currently held by the Bidders or Persons Acting in Concert with the Bidders or their subsidiaries; Attribution of voting rights.................................................................... 20 5.9 Information about securities transactions .................................................................. 21 6. DESCRIPTION OF THE TARGET ................................................................................ 21 6.1 Legal basis and capital structure .............................................................................. 21 6.2 Business activities .................................................................................................. 23 6.3 Selected financial figures......................................................................................... 24 6.4 Corporate bodies.................................................................................................... 24 6.5 Persons acting in concert with the Target .................................................................. 24 6.6 Indication of the opinion of the management board and the supervisory board of KHD on the Takeover Offer ................................................................................................. 25 7. BACKGROUND OF THE OFFER .................................................................................. 25 8. INTENTIONS OF THE BIDDERS AND OF THE FURTHER ACQUIRERS OF CONTROL IN RESPECT OF THE FUTURE OF KHD AND THE BIDDERS ................................................ 25 8.1 Future business activity of KHD................................................................................ 25 8.2 Registered office of KHD; Location of significant business divisions............................... 26 8.3 Employees, employee representation and employment conditions ................................ 26 8.4 Management board and supervisory board of KHD ..................................................... 26 8.5 Structural changes and other important measures...................................................... 26 8.6 Future use of KHD's assets...................................................................................... 26 8.7 Future obligations of KHD........................................................................................ 26 8.8 Details of the intentions relating to the future of the Bidders as well as Goldimax, Golden Prosperity, Kaihang, Kairong, AVIC Beijing, AVIC International, AVIC Holding, AVIC Shenzhen and AVIC................................................................................................ 27 9. CONSIDERATION ................................................................................................... 27 9.1 Type and amount of consideration offered................................................................. 27 9.2 No applicability of Section 33b WpÜG ....................................................................... 29 2 [Translation of the German Offer Document – for convenience purposes only] 9.3 Cash payments or other cash-equivalent benefits for management board and supervisory board members of KHD and potential conflicts of interest............................................ 29 10. FINANCING THE TAKEOVER OFFER........................................................................... 29 10.1 Transaction volume ................................................................................................ 29 10.2 Financing measures................................................................................................ 29 10.3 Confirmation of financing ........................................................................................ 30 11. INFORMATION REGARDING OFFICIAL APPROVALS AND PROCEEDINGS IN CONNECTION WITH THE ACQUISITION OF THE SECURITIES OF KHD ............................................... 31 11.1 Merger control ....................................................................................................... 31 11.2 Clearance under the German Foreign Trade Regulation ............................................... 31 11.3 Requirements under HKSE Listing Rules.................................................................... 31 11.4 Approval of Publication of this Offer Document........................................................... 32 12. OFFER CONDITION................................................................................................. 32 12.1 Offer Condition ...................................................................................................... 32 12.2 Waiver of Offer Condition ........................................................................................ 32 12.3 Non-fulfilment of the Offer Condition ........................................................................ 33 12.4 Publication of satisfaction or non-satisfaction of the Offer Condition.............................. 33 13. ACCEPTANCE