Securities code Shanghai Zhenhua Heavy Industries Co.Ltd(600320) 900947 securities abbreviation Shanghai Zhenhua Heavy Industries Co.Ltd(600320) Zhenhua B share No.: pro 2022008
Announcement of framework agreement on daily related party transactions
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Important content tips:
(hereinafter referred to as “Shanghai group”) shall be submitted to the general meeting of shareholders for deliberation.
This related party transaction framework agreement is required by the company’s normal production and operation, does not affect the independence of the company, and will not rely on related parties.
1、 Basic information of daily related party transactions
(I) overview of daily related party transactions
In order to regulate the daily related party transactions between Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units and China Communications Construction Group Co., Ltd. (hereinafter referred to as “CCCC group”) and its subordinate units, the company plans to sign the 20222024 framework agreement on daily related party transactions (hereinafter referred to as “framework agreement”) with CCCC group.
(II) review procedures for the performance of daily connected transactions
1. On April 13, 2022, the company held the 9th meeting of the 8th board of directors, deliberated and adopted the proposal on deliberation of signing the framework agreement on daily related party transactions in 20222024. Related directors have avoided voting.
2. The above proposal has been approved by the company’s independent directors in advance.
3. The independent directors of the company expressed independent opinions on the above proposal and believed that: the proposal is conducive to the company to expand its business scope and seek new development, follow the principles of fairness, impartiality and fairness, the transaction matters comply with market rules, and the proposed transaction pricing is fair and reasonable; There is no situation that damages the interests of the company and all shareholders, especially minority shareholders, and will not affect the independence of the company. The deliberation and voting procedures of the proposal shall comply with the relevant provisions of the articles of association and the rules of procedure of the board of directors. We agree to the proposal on reviewing and signing the framework agreement on daily related party transactions for 20222024 and submit the proposal to the general meeting of shareholders of the company for deliberation.
(III) related party transactions in 2019, 2020 and 2021
Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units and CCCC group and its subordinate units in 2019, 2020 and 2021, the actual amount of related party transactions (audited) is as follows:
In 2019, Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units purchased commodities from CCCC and its subordinate units, with an actual amount of about 100 million yuan Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units accept the labor services provided by CCCC group and its subordinate units, and the actual amount is about 2.7 billion yuan Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units sell commodities / other inflows to CCCC and its subordinate units, and the actual amount is about 3.8 billion yuan.
In 2020, Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units purchased commodities from CCCC and its subordinate units, with an actual amount of about 800 million yuan Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units actually received the labor services provided by CCCC group and its subordinate units, with an amount of about 2.1 billion yuan Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units sell commodities / other inflows to CCCC and its subordinate units, and the actual amount is about 2.6 billion yuan.
In 2021, Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units purchased products from CCCC and its subordinate units, with an actual amount of about 500 million yuan Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units accept the labor services provided by CCCC group and its subordinate units, and the actual amount is about 1.9 billion yuan Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units sell products to CCCC group and its subordinate units, and the actual amount is about 2.7 billion yuan Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units provide labor services to CCCC and its subordinate units, and the actual amount is about 700 million yuan.
2、 Basic information of related parties and analysis of performance ability of related parties
1. Basic information of related parties
CCCC group is a large central enterprise managed by the state owned assets supervision and Administration Commission of the State Council.
(1) Nature of enterprise: limited liability company (solely state-owned)
(2) Legal representative: Wang TongZhou
(3) Registered capital: 72740238297 yuan
(4) Registered address: 85 Deshengmenwai street, Xicheng District, Beijing
(5) Business scope: contracting overseas projects and domestic international bidding projects; General contracting construction of various professional ships; Leasing and maintenance of professional ships and construction machinery; Professional services related to offshore towing and offshore engineering; Technical consulting services for ships and port supporting equipment; Undertake the general contracting of port, waterway, highway and bridge construction projects outside China (including engineering technical and economic consultation, feasibility study, survey, design, construction, supervision, procurement and supply of relevant complete sets of equipment and materials, and equipment installation); Undertake the general contracting of industrial and civil construction, railway, metallurgy, petrochemical, tunnel, electric power, mining, water conservancy and municipal construction projects; Import and export business; Real estate development and property management; Investment and management of transportation, hotel and tourism. (market entities shall independently choose business projects and carry out business activities according to law; projects that must be approved according to law shall carry out business activities according to the approved contents after being approved by relevant departments; they shall not engage in business activities of projects prohibited and restricted by national and municipal industrial policies.)
(6) Affiliated relationship: according to the definition of affiliated legal person in article 6.3.3 of the Listing Rules of Shanghai Stock Exchange (revised in January 2022), since CCCC group holds Shanghai Zhenhua Heavy Industries Co.Ltd(600320) 46.229% of the shares directly or indirectly, CCCC group and its subordinate units (excluding Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and Shanghai Zhenhua Heavy Industries Co.Ltd(600320) consolidated units) belong to Shanghai Zhenhua Heavy Industries Co.Ltd(600320) affiliated legal persons.
(7) Main financial data: as of December 31, 2020, CCCC group had total assets of RMB 200271 billion, net assets of RMB 500509 billion, operating revenue of RMB 737389 billion and net profit of RMB 8.039 billion in 2020 (the above data have been audited).
2. Analysis of related party’s performance capability
Shanghai Zhenhua Heavy Industries Co.Ltd(600320) cccc has normal production and operation, good credit status, and normal performance of daily related party transactions carried out by both parties. At present, CCCC has normal financial status, has the performance ability of continuous operation and service, and there is no performance risk.
3、 Main contents of the agreement
The framework agreement is applicable to the daily related party transactions between Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units and CCCC group and its subordinate units. The basic contents are as follows:
1. Agreement Name: 20222024 framework agreement on daily connected transactions
2. Signed by: Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and CCCC
3. Basic contents of the agreement:
(1) Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units provide labor services to CCCC group and its subordinate units in accordance with the terms and conditions of this Agreement;
(2) Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units accept the labor services of CCCC group and its subordinate units according to the terms and conditions of this Agreement;
(3) Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units sell products to CCCC group and its subordinate units according to the terms and conditions of this Agreement;
(4) Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and its subordinate units purchase products from CCCC group and its subordinate units according to the terms and conditions of this agreement.
4. Pricing principle: the related party transactions under this Agreement shall be conducted in an open, fair and impartial manner. The pricing principles include: (1) national pricing; Or (2) adopt the market price in the absence of national pricing; (1) when the cost of the above materials or services provided by the supplier (2) is not applicable, (3) when the cost of the above materials or services is not applicable.
5. Effective date of the agreement: it shall take effect from the date of deliberation and approval by the general meeting of shareholders.
6. Annual maximum amount to be applied:
Unit: RMB
Related party transaction category related party 20222023 2024
Estimated amount estimated amount
Providing labor services to CCCC group and 1.3 billion yuan, 1.8 billion yuan and 2.3 billion yuan
Its subordinate units
Products sold by CCCC group and 5.5 billion yuan, 6 billion yuan and 6.5 billion yuan
Its subordinate units
Receiving labor services from CCCC group and 3.5 billion yuan, 3.5 billion yuan and 3.5 billion yuan
Its subordinate units
Purchased products: CCCC group and 1.5 billion yuan, 1.5 billion yuan and 1.8 billion yuan
Its subordinate units
The total is 11.8 billion yuan, 12.8 billion yuan and 14.1 billion yuan
Among them, the daily related party transactions whose annual amount exceeds the expected amount of the current year and the cumulative amount exceeds more than 5% of the absolute value of the company’s latest audited net assets shall be submitted to the general meeting of shareholders for deliberation and approval before implementation. 4、 Purpose of signing the agreement and its impact on the listed company
The 20222024 framework agreement on daily related party transactions was signed between the company and CCCC group on the principle of openness, fairness and impartiality and on the basis of market fair price; The signing of the agreement is conducive to improving the company’s operation efficiency, meeting the needs of the company’s business development and production and operation, expanding the business scale of Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and obtaining reasonable returns and enhancing market competitiveness. It is of positive significance to the development of Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and is conducive to the interests of Shanghai Zhenhua Heavy Industries Co.Ltd(600320) and all shareholders. Its existence is necessary. The above connected transactions do not harm the interests of the company and all shareholders, have no adverse impact on the company’s financial status and operating results, and do not affect the company’s independence.
It is hereby announced.
Board of directors of Shanghai Shanghai Zhenhua Heavy Industries Co.Ltd(600320) (Group) Co., Ltd. April 14, 2022
