CIMC Vehicles Plans to Issue Shares on A-share Market

Late on May 6, 2020, A + H listed company CIMC Group released an announcement that the listing resolution was deliberated and adopted in the board meeting of its holding subsidiary CIMC Vehicles Group Co., Ltd. (hereinafter referred to as "CIMC Vehicles"). The CIMC Vehicles will launch an initial public offering of RMB common shares (A shares) in China and trade on the GEM of the Shenzhen Stock Exchange. This means that CIMC Vehicles will become a listed company in A-share market. Successful A-share listing would make it the first semi-trailer company to list on the A-share market.

According to the CIMC’s announcement, in the initial A-share issuance plan, CIMC Vehicles aims to issue no more than 15% of CIMC Vehicles' total share capital and no more than 311.47 million shares (including 311.47 million shares). CIMC Vehicles will issue the shares at an appropriate time after the approval of Shenzhen Stock Exchange and the registration with China Securities Regulatory Commission. The specific issuance date shall be determined by the board of directors of CIMC Vehicles or its authorized persons through consultation with relevant regulatory authorities.

CIMC's announcement states that the CIMC Group holds a total of 53.82% of the equity of CIMC Vehicles and is the controlling shareholder of CIMC Vehicles. After the completion of the A-share issuance, CIMC Group will remain the controlling shareholder of CIMC Vehicles, and CIMC Vehicles will remain a subsidiary within the scope of the consolidated statements of CIMC Group.

For CIMC Vehicles, the A-share issuance will help CIMC Vehicles further expand the financing channels in the A-share capital market, promote business transformation and development, and create greater value for shareholders and investors. It will also help CIMC Vehicles further improve the incentive mechanism for management and key personnel in the A-share capital market, urge the management personnel to fulfill their responsibilities and stimulate their enthusiasm and creativity, so as to improve the business performance. For CIMC Group, the completion of CIMC Vehicles' A-share issuance will help add the system value of CIMC, which will not damage status of CIMC Group as an independent public company and its sustained profitability, and will help to maximize the values for shareholders of CIMC Group.

It is also reported that on July 11, 2019, CIMC Vehicles was officially listed on the Hong Kong Stock Exchange, which is the first semi-trailer manufacturer listed on the Hong Kong stock market. Thus, CIMC Vehicles has officially become the fourth independent listed platform established by CIMC after CIMC Group (A + H shares), CIMC ENRIC (H shares) and CIMC TianDa (H shares). CIMC Vehicles has maintained a good profit situation since its listing. According to its first Announcement of Annual Results (H-share) after listing, the net profit of CIMC Vehicles is 1.326 billion yuan in 2019, increasing by 7.7 percent year on year.

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