Announcement on The Provision

RNS Number : 1035D

Datang Intl Power Generation Co Ld

10 September 2008

 

DATANG INTERNATIONAL POWER GENERATION CO., LTD.

   (a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 991)

 

OVERSEAS REGULATORY ANNOUNCEMENT

ANNOUNCEMENT ON THE PROVISION

OF GUARANTEES

 

SPECIAL NOTICES:   The board of directors (the “Board”) and all directors (the “Directors”) of the Company warrant that there are no false representations or misleading statements contained in, or material omissions from, this announcement; and jointly and severally accept full responsibility for the truthfulness, accuracy and completeness of the information contained in this announcement.   This announcement is made pursuant to Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

 

Important notices regarding the content:

l           The guaranteed party: Jiangxi Datang International Xinyu Power Generation Company Limited (“Xinyu Power Generation Company”)

l The amount of these guarantees and the aggregate guarantee amount: The amounts of these guarantees are RMB486 million and RMB80 million respectively.

The aggregate guarantee amount before these guarantees was nil.

l Provision of counter-guarantee: Nil.

l The aggregate amount of external guarantees: As of 30 June 2008, the aggregate amount of external guarantees of the Company and its controlling subsidiaries amounted to RMB11,398.67 million.

l The aggregate amount of overdue external guarantees: Nil.

 

I.    Information of the Guarantees

 

1.  On 5 September 2008, Datang International Power Generation Co., Ltd. (the “Company”) entered into a “Guarantee Contract” (“Guarantee Contract”) with China Development Bank under which the Company shall provide a joint liability guarantee in favour of China Development Bank in respect of a loan in an amount of RMB486 million applied by Xinyu Power Generation Company, the Company’s wholly-owned subsidiary, under its “Renminbi Loan Contract” (“Loan Contract”) with China Development Bank. The Company shall act in accordance with the Guarantee Contract during the guarantee period. 

The “Resolution on undertaking of guarantee obligation for Jiangxi Datang International Xinyu Power Generation Company Limited” (《關於承接江西大唐國際新余發電有限責任公司擔保責任的議案》) was considered by the fourth meeting of the sixth session of the Board and the 2007 Annual General Meeting (“General Meeting”). The Board and the shareholders of the Company at the General Meeting resolved that the Company should provide guarantee for Xinyu Power Generation Company in connection with a bank loan of RMB555.1 million. The guarantee will be provided on a joint-liability basis.

 

2.  The Company will enter into a guarantee contract (“Relevant Guarantee Contract”) with China Development Bank under which the Company shall provide a joint liability guarantee in respect of a loan in an amount of RMB80 million applied by Xinyu Power Generation Company for the construction of desulphurisation facilities with China Development Bank. The Company shall act in accordance with the Relevant Guarantee Contract during the guarantee period.

 

The “Resolution on provision of guarantee for Jiangxi Datang International Xinyu Power Generation Company Limited” (《關於為江西大唐國際新余發電有限責任公司提供擔保的議案》) was considered by the thirteenth meeting of the sixth session of the Board. The Board resolved that the Company shall provide a joint liability guarantee in connection with the financing of Xinyu Power Generation Company for its application of bank loan facilities and construction of desulphurisation facilities, with a guarantee amount of RMB180 million. As the asset to liability ratio of Xinyu Power Generation Company is over 70%, this resolution will be proposed to the 2008 First Extraordinary General Meeting of the Company for consideration.

 

II. Information of the Guaranteed Party

 

Xinyu Power Generation Company was established in 1997 with a registered capital of RMB319.4 million. Its address is Xinyu City, Jiangxi Province, the People’s Republic of China, and its scope of business includes the operation of two 200MW coal-fired power generating units, development of energy conservation projects, integrated application of pulverized fuel ash and related businesses. 

 

As of 31 December 2007, the total assets, liabilities and asset-to-liability ratio of Xinyu Power Generation Company were approximately RMB1,161.52 million, RMB1,101.65 million and 94.85%, respectively. As of 30 June 2008, the total assets, total liabilities, asset-to-liability ratio and total loans of Xinyu Power Generation Company were approximately RMB1,199.66 million, RMB1,162.10 million, 96.87% and RMB624.6 million, respectively (the above figures are unaudited).

 

 

 

 

 

 

 

III. Major Terms of the Guarantee Contracts

 

1.  In accordance with the Guarantee Contract, the Company shall provide guarantee to China Development Bank in respect of a loan in the principal amount of RMB486 million, its interest, penalty interest, compensation, penalty, award of damages and expenses for execution of creditor's rights under the Loan Contract. The guarantee will be provided on a joint-liability basis. The guarantee period is one year after the expiration of the term for performance of each loan under the Loan Contract and the term for performance of loan under the Loan Contract is ten years.

 

2.  In accordance with the Relevant Guarantee Contract, the Company shall provide a guarantee in respect of a loan in an amount of RMB80 million applied by Xinyu Power Generation Company with China Development Bank. The guarantee covers the principal amount of RMB80 million, its interest, penalty interest, compensation, penalty, award of damages and expenses for execution of creditor's rights. The guarantee will be provided on a joint-liability basis. The guarantee period is one year after the expiration of the term for performance of each loan under the relevant loan contract and the term for performance of loan under the relevant loan contractis ten years.

 

IV. Opinion of the Board

 

1.  Opinion of the Board on a guarantee provided for a loan in an amount of RMB486 million applied by Xinyu Power Generation Company:

 

The Board is of the opinion that since the original bank loans of Xinyu Power Generation Company were due when it was acquired by the Company in October 2007, it was necessary for Xinyu Power Generation Company to continue to obtain loans from banks so as to meet the requirements of its normal operation. Therefore, the Board agreed to provide guarantee for its bank loans with a view to meeting the requirements of the overall development for the Company and its subsidiaries. This guarantee has been considered and approved by the shareholders of the Company at the General Meeting of the Company.

 

2.  Opinion of the Board on a guarantee provided for a loan in an amount of RMB80 million applied by Xinyu Power Generation Company:

 

The Board is of the opinion that utilisation of the bank loan by Xinyu Power Generation Company on constructing desulphurisation facilities can ensure the smooth implementation of the power generation plan for 2009 and onwards and satisfy the requirements of development for Xinyu Power Generation Company. The Board agreed that the Company shall provide guarantee for its bank loans with a view to meeting the requirements of the overall development for the Company and its subsidiaries. The Board agreed to propose this guarantee to the 2008 First Extraordinary General Meeting of the Company for consideration and approval.

 

V.   Aggregated Amount of External Guarantees and Amount of Overdue Guarantees

 

As of 30 June 2008, the Company’s aggregate amount of external guarantees was RMB11,398.67 million (unaudited), representing 33.52% of the audited net assets in the latest financial report. Such guarantees were all made for the subsidiaries, jointly-controlled entities and associates of the Company and there were no overdue guarantees.

 

 

 

By Order of the Board 

Zhou Gang    

Secretary to the Board

 

 

Beijing, the PRC, 9 September 2008

 

As at the date of this announcement, the directors of the Company are:

 

Zhai Ruoyu, Hu Shengmu, Cao Jingshan, Fang Qinghai, Zhou Gang, Liu Haixia, Guan Tiangang, Su Tiegang, Ye Yonghui, Li Gengsheng, Xie Songlin*, Liu Chaoan*,
Yu Changchun*, Xia Qing* and Li Hengyuan*

 

* Independent non-executive directors

 

 

 

 

END

 

 

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