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GZI Transport Acquires Equity Interests in Three Portions of Tianjin Section of Jinbao Expressway

Date: 2009-09-25
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 (Hong Kong, 25 September 2009)…GZI Transport Limited (“GZI Transport” or the “Company”)     (Stock Code: 1052) announces today that the Company will acquire 60% equity interests in Tianjin Jinfu Expressway Co., Ltd. (“Tianjin Jinfu”),Tianjin Langdao Expressway Co., Ltd. (“Tianjin Langdao”) and Tianjin Yuanhong Expressway Co., Ltd. (“Tianjin Yuanhong”) for a consideration of RMB340,000,000 (approximately HK$386,759,000) through its wholly-owned subsidiary Choice Tone. Tianjin Jinfu, Tianjin Langdao and Tianjin Yuanhong operate different portions of Tianjin Section of Jinbao Expressway.

 

Tianjin Jinfu, Tianjin Langdao and Tianjin Yuanhong are sino-foreign joint venture companies. Their only assets are the portions of Waihuan Line–Shuangkou Zhennan, Shuangkou Zhennan–Xujiabao and Xujiabao–border of Hebei Province, respectively, of Tianjin Section of Jinbao Expressway. Tianjin Jinfu, Tianjin Langdao and Tianjin Yuanhong recorded revenues and profits after tax of RMB69,587,000 and RMB18,637,000 totally for the first half of 2009.

 

Jinbao Expressway commenced operations in July 2000 and has a mileage of 23.944 km. It connects with Hebei Jinbao Highway, Tianjin Jinjin Highway, Jinghu Highway, Tianjin Waihuan Lane and other provincial and national highways / expressways.

 

Regarding the acquisition, Mr. Zhang Zhaoxing, Chairman of GZI Transport said, “As GZI Transport takes the optimization of its toll road mix as its top priority, GZI Transport has been proactively expanding its portfolio ratio of expressways to Class I highways. Under the support from the central government, the economy of Tianjin City has been developing rapidly with a year-on-year growth rate of 16.2% in its GDP in the first half of 2009. The acquisition of Jinbao Expressway, which is located in the western part of Tianjin City, will help increase the weight of expressway projects in the Company’s assets and will help improve the Company’s business structure. The acquisition is also aimed at attaining the Company's long-term objective of continuously enhancing its profitability.

 

The acquisition will be effective only after Tianjin Expressway Group has issued a waiver of pre-emptive right in relation to the proposed acquisition. If such waiver is not obtained or if the board of the Company does not approve the proposed acquisition within one month of the date of signing of the Equity Transfer Deed, the agreement shall be terminated.

 

Profile of GZI Transport Limited


 The Group is mainly engaged in investment, operation and management of toll expressways, national highways and bridges mainly located in Guangdong Province. As at 30 June 2009, the Group had 12 toll road and bridge projects which it invests in and operates, with an attributable length of approximately 317.3 km. These projects include Guangzhou City Northern Ring Road, Guangzhou City Northern Second Ring Expressway, Guangzhou Western Second Ring Expressway, Guangdong Humen Bridge and Shantou Bay Bridge; inter-province transportation projects such as Guangshen Highway, Guangshan Highway, Guangcong Highway II, Guanghua Highway, Qinglian Highways and Cangyu Expressway all of which connects the transportation hub in Guangzhou City with Guangdong, Hunan and Jiangxi provinces; and Xian-Lintong Expressway in Shaanxi Province. All of these projects have been in operation and collecting toll fees.

 

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Note: For details of the acquisition, please refer to the Discloseable Transaction Announcement dated 25 September 2009

 

For enquiries, please contact:

Mr. Karl Cheung / Ms. Christy Lai
Rikes Hill and Knowlton Limited
Tel: (852) 2520 2201
Fax: (852) 2520 2241
 

 

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