Securities abbreviation: Chongqing Changan Automobile Company Limited(000625) (Chang’an b) securities code: Chongqing Changan Automobile Company Limited(000625) (200625) Announcement No.: 202234 Chongqing Changan Automobile Company Limited(000625)
Announcement on related party transactions of Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd. providing financial services for the company
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
Chongqing Changan Automobile Company Limited(000625) (hereinafter referred to as “the company”) has held the 40th meeting of the 8th board of directors on May 20, 2022, deliberated and adopted the proposal on signing the financial service agreement with Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd. The specific contents are hereby announced as follows:
1、 Overview of related party transactions
1. In order to save transaction costs and expenses and further improve the efficiency of capital use, the company plans to carry out relevant business cooperation with Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd. (hereinafter referred to as “auto finance company”) and sign the financial service agreement. The auto finance company will provide the company with deposit business with a maximum daily deposit balance of no more than 15 billion yuan, auto finance personal consumer credit discount service with a maximum total amount of 4 billion yuan Auto financial services and other financial services with a maximum total credit of 6 billion yuan. The financial services agreement shall be valid for one year from the date of approval by the general meeting of shareholders. If both parties fail to sign a new financial service agreement upon expiration, this agreement will automatically continue for one year.
2. Description of related party relationship: according to the stock listing rules of Shenzhen Stock Exchange, this transaction constitutes a related party transaction between the company and the related legal person controlled by the same ultimate holding company China Ordnance Equipment Group Co., Ltd. (hereinafter referred to as “Ordnance Group”), and this transaction constitutes a related party transaction.
3. The company held the 40th meeting of the 8th board of directors on May 20, 2022, deliberated and adopted the proposal on signing the financial service agreement with Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd. Related directors Mr. Zhu Huarong, Mr. Zhang Bo, Mr. Liu Gang, Mr. Ye Wenhua, Mr. Zhou Kaiquan and Mr. Zhang Deyong avoided voting on the proposal, and the other 9 directors attending the meeting unanimously agreed to the proposal. The independent directors approved the related party transactions in advance and expressed independent opinions.
4. This transaction is subject to the approval of the general meeting of shareholders, and the related parties interested in the related party transaction will withdraw from voting.
5. This connected transaction does not constitute a major asset reorganization as stipulated in the administrative measures for major asset reorganization of listed companies, does not constitute a reorganization and listing, and does not need to be approved by relevant departments.
2、 Basic information of related parties
1. Company name: Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd
2. Registered address: 27-1, 28-1, 29-1, No. 14, yongpingmen street, Jiangbei District, Chongqing
3. Enterprise type: limited liability company
4. Legal representative: ye Yuxin
5. Registered capital: 476843 million yuan
6. Tax registration certificate No.: 9150 Shenzhen Fountain Corporation(000005) 172683xw
7. Main business: accepting time deposits of more than 3 months (inclusive) from overseas shareholders and their group’s wholly-owned subsidiaries in China and domestic shareholders; Accept the loan deposit for the purchase of vehicles by auto dealers and the deposit for the lease of vehicles by the lessee; Issue financial bonds upon approval; Start credit asset securitization business; Engage in interbank lending; Borrowing from financial institutions; Provide car purchase loan business; Provide loans for auto dealers to purchase vehicles and operating equipment, including loans for exhibition hall construction, spare parts and maintenance equipment; Provide automobile financial leasing business (except sale and leaseback business); Selling or repurchasing auto loan receivables and auto finance lease receivables to financial institutions; Handle the residual value sale and disposal of leased cars; Engage in consulting and agency business related to car purchase financing activities; Approved to engage in equity investment business of financial institutions related to auto finance business; Other businesses approved by Bank Of China Limited(601988) industry supervision and administration department.
8. Major shareholder: China Ordnance Equipment Group Co., Ltd. invested 144825 million yuan, accounting for 30.37% of the share capital Chongqing Changan Automobile Company Limited(000625) invested 136649 million yuan, accounting for 28% of the share capital 6 6 % ； Ordnance Equipment Group Finance Co., Ltd. invested 1 million yuan, accounting for 20.97% of the share capital; Chongqing Yufu capital operation group Co., Ltd. invested 953.68 million yuan, accounting for 20% of the share capital.
9. Actual controller: China Ordnance Equipment Group Co., Ltd
10. History: Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd. was founded on August 13, 2012, formerly known as Chongqing Auto Finance Co., Ltd. In November 2015, with the joint promotion of Chongqing municipal government and Ordnance Group, Ordnance Group joined hands with its subordinate member units to increase the capital and restructure the auto finance company. After the capital increase and share expansion, the registered capital of the auto financing company increased to 2.5 billion yuan. In August 2016, it was renamed Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd. In December 2017, the shareholders led by Ordnance Group increased the capital of the auto finance company. After the capital increase, the registered capital of the auto finance company increased from 2.5 billion yuan to 4.768 billion yuan, and the controlling shareholder is still the Ordnance Group.
11. Development of main businesses in recent three years: Chongqing Changan Automobile Company Limited(000625) finance has the first auto finance license approved by the CBRC in Western China, specializing in providing auto finance services for auto dealers, institutions and individual consumers. In recent years, based on the industrial financial positioning, auto finance companies have achieved good development in four major aspects: service main business, risk prevention and control, scientific and technological innovation and sustainable growth. The main business of auto finance companies has covered all provinces, cities and autonomous regions in China except Hong Kong, Macao and Taiwan, providing high-quality financial service support to more than 4000 auto dealers and more than 2 million individual consumers.
12. Financial overview of the latest year: as of December 31, 2021, the audited total assets of the auto finance company were 65.885 billion yuan and the net assets were 8.625 billion yuan; From January to December 2021, the operating revenue was 4.973 billion yuan and the net profit was 865 million yuan.
13. Related relationship with listed companies: the auto finance company is the holding subsidiary of China Ordnance Equipment Group Co., Ltd., the actual controller of the company, and forms a related party relationship controlled by the same actual controller with the company.
14. After inquiry, the auto finance company is not the person who is executed for breaking his promise.
3、 Basic information of related party transactions
Auto finance companies provide the company with deposit business with a maximum daily deposit balance of no more than 15 billion yuan, auto finance personal consumer credit discount service with a maximum total amount of 4 billion yuan, auto finance service with a maximum total amount of credit of 6 billion yuan and other financial services.
The financial services agreement shall be valid for one year from the date of approval by the general meeting of shareholders. If both parties fail to sign a new financial service agreement upon expiration, this agreement will automatically continue for one year.
4、 Pricing policy and basis of related party transactions
The service price shall follow the principle of fairness and reasonableness, and the price of financial services shall be determined according to the standard not higher than the market fair price or the standard specified by the state.
5、 Main contents of related party transaction agreement
(I) deposit service
1. The company shall open a deposit account in the auto financing company and deposit the funds into the deposit account opened in the auto financing company in the form of fixed deposit for more than 3 months (inclusive) based on the principle of free access; 2. The deposit interest rate provided by the auto financing company for the company shall be determined by both parties through negotiation on the basis of not violating the relevant provisions of the people’s Bank of China on interest rate management, and shall not be lower than the deposit interest rate of the same grade obtained by the company in other Chinese financial institutions in the same period;
3. During the term of this agreement, the maximum daily deposit balance of the company in the auto finance company shall not be higher than RMB 15 billion in principle;
4. The auto financing company ensures the safety of the company’s deposits and cashes them in full and in time when the company puts forward capital needs.
(II) auto financial services
1. In order to support the sales of the company’s brand automobile products and improve the market share, the auto finance company agrees to provide financing services for the company’s authorized dealers who meet the credit conditions, as well as personal consumer credit services for the sales of the company’s brand automobile;
2. During the term of this agreement, the auto finance company will provide auto finance personal consumer credit discount service for customers who purchase products from the company through loans, and the maximum total amount of discount interest obtained from the company is 4 billion yuan; 3. During the term of this agreement, the maximum total credit granted by the auto finance company to the franchised dealers of the company’s brand auto products is 6 billion yuan;
4. Specific matters related to auto financial services shall be separately agreed by both parties.
(III) other financial services
1. In addition to the above financial services, the auto finance company will also provide the company with consulting, agency business, auto finance leasing and other financial services related to car purchase financing activities within the business scope permitted by laws and regulations and business license;
2. Before entering into an independent financial company agreement, the two parties need to negotiate and provide other services to the automobile financial company;
3. For other financial services provided by an auto financing company to the company, the price of financial services shall be determined in accordance with the principle of fairness and reasonableness and shall not be higher than the market fair price or the standards stipulated by the state.
The above transactions shall take effect after being approved by the general meeting of shareholders of the company.
6、 Purpose and impact of related party transactions
The financial services provided by auto finance companies are normal non bank financial institutions. The purpose is to save transaction costs and expenses, further improve the efficiency of capital use, and reduce financing costs and risks. The service price shall follow the principle of fairness and reasonableness, and the price of financial services shall be determined according to the standard not higher than the market fair price or the standard specified by the state. The related party transaction will not damage the interests of the company and non related shareholders.
7、 Accumulated various connected transactions with the connected person
From the beginning of the year to the disclosure date, the company and the auto finance company had no other related party transactions except the daily operating related party transactions.
8、 Prior approval and independent opinions of independent directors
The independent directors approved such related party transactions before the board of directors and agreed to submit them to the board of directors for discussion. Independent opinions were expressed after the meeting. The independent directors of the company believed that:
The company signed the financial service agreement with Chongqing Changan Automobile Company Limited(000625) Finance Co., Ltd. the auto finance company will provide the company with deposit services with a maximum daily deposit balance of no more than 15 billion yuan, auto finance personal consumer credit discount business with a maximum total amount of 4 billion yuan, auto finance services with a maximum total amount of credit of 6 billion yuan and other financial services. The purpose of signing the above financial service agreement is to save transaction costs and expenses, further improve the use efficiency of funds and reduce financing costs and financing risks. In addition, the company regularly evaluates the risks of auto financing companies and formulates emergency response plans. The related party transaction will not harm the interests of the company and minority shareholders. When the board of directors votes on the above related party transactions, the related directors withdraw and meet the requirements of relevant laws and regulations.
To sum up, we believe that the above-mentioned decision-making procedures of the company’s related party transactions are legal, the transaction price is fair, and there is no harm to the interests of other shareholders. We agree to the above related party transactions and agree to submit the matter to the general meeting of shareholders of the company for deliberation.
9、 Directory of documents for future reference
1. Resolutions of the 40th meeting of the 8th board of directors;
2. Prior approval opinions and independent opinions of independent directors;
3. Financial services agreement.
It is hereby announced
Chongqing Changan Automobile Company Limited(000625) board of directors may 21, 2022
