Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd
Verification opinions on the reply to the notice of the CSRC on the first feedback on the examination of administrative licensing projects
China Securities Regulatory Commission:
On April 28, 2022, your Association issued the feedback on the application of Shanxi Coking Coal Energy Group Co.Ltd(000983) issuing shares and paying cash to purchase assets and raise supporting funds (No. 220580, hereinafter referred to as “feedback”). Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd., as the land appraisal institution of this reorganization, analyzed and verified the relevant problems in the feedback and issued the following verification opinions: question 18, 8) whether the transaction appraisal / land appraisal institution has relevant professional institutions and business qualifications and complies with the provisions of Article 17 of the reorganization measures. Please conduct self-examination by the appraisal / land appraisal institution and independent financial consultant and give clear opinions.
Reply: I. relevant business qualifications of the transaction appraisal / land appraisal institution
(1) Qualification of asset appraisal institution
The pricing of this transaction is based on the asset appraisal report issued by Zhongshui Zhiyuan. Zhongshui Zhiyuan obtained the qualification certificate for securities and futures related business evaluation approved by the Ministry of Finance and the CSRC on February 13, 2009 (approval No.: Cai Qi [2009] No. 23, Certificate No.: 01 Shenyang Machine Tool Co.Ltd(000410) 17, change No.: Cai ban Qi [2011] No. 92). According to the list of asset appraisal institutions engaged in securities service business (as of March 31, 2022) issued by the CSRC and the filing list and basic information of asset appraisal institutions engaged in securities service business (as of April 30, 2022) issued by the Ministry of finance, Zhongshui Zhiyuan is qualified to engage in asset appraisal of securities service business and has completed relevant filing.
(2) Qualification of mining right evaluation institution
The issuing institution of the mining right appraisal report quoted by the mining right appraisal value in the subject assets is Shanxi Rulin Asset Appraisal Office Co., Ltd. Rulin appraisal holds the qualification certificate of exploration and mining right appraisal issued by China Association of mining right Appraisers (Certificate No.: mining right appraisal Zi [1999] No. 003), and the scope of appraisal contained in the certificate is exploration right and mining right appraisal.
(3) Qualification of land appraisal institution
Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd. is the issuer of the land appraisal report cited in the land appraisal of the subject assets. Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd. is a land appraisal institution registered with the Department of natural resources of Shanxi Province in accordance with the asset appraisal law (filing No.: jtgbz [2020] No. 0018), and holds the registration certificate of land appraisal institution (Certificate No.: jtba142018064) issued by Shanxi Association of land appraisers and land registration agents.
2、 This transaction complies with the provisions of Article 17 of the reorganization measures
For the underlying assets, Zhongshui Zhiyuan appraisal, an appraisal institution in line with the provisions of the securities law, issued an asset appraisal report covering complete assets and liabilities including mining right and land use right, in which the mining right asset appraisal quoted the appraisal results of Shanxi Rulin Asset Appraisal Office Co., Ltd. and the land use right quoted the appraisal results of Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd.
According to the first paragraph of Article 2 of the code of practice for asset appraisal – use of expert work and related reports: “the use of expert work and related reports as mentioned in these standards refers to the behavior of asset appraisal institutions in hiring experts to assist in their work, using professional reports and quoting single asset appraisal reports in the process of asset appraisal business.” Paragraph 4 of Article 2: “quoting a single asset appraisal report means that the asset appraisal institution refers to quoting the single asset appraisal report issued by other appraisal institutions as an integral part of the asset appraisal report in accordance with the requirements of laws and administrative regulations.”
In this transaction, the listed company entrusted Shanxi Rulin Assets Appraisal Office Co., Ltd. to evaluate the mining right of the subject asset and Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd. to evaluate the land use right of the subject asset. Zhongshui Zhiyuan appraisal, the appraisal institution of this transaction, reviewed its appraisal process and conclusion. The review procedure includes on-site investigation, evaluating the rationality of the selected parameters and the rationality of the appraisal conclusion. According to the review of Zhongshui Zhiyuan, the appraisal of mining right and land use right by Shanxi Rulin Assets Appraisal Office Co., Ltd. and Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd. is consistent with the appraisal report of Zhongshui Zhiyuan in terms of appraisal purpose, appraisal object, value standard and value connotation, and the appraisal conclusion is reasonable. Therefore, Shanxi Rulin Assets Appraisal Office Co., Ltd The appraisal result of Shanxi Zhiyuan real estate appraisal and Consulting Co., Ltd. belongs to the single asset appraisal report quoted by Zhongshui Zhiyuan appraisal.
Article 17 of the reorganization management measures “… If the asset transaction pricing is based on the asset evaluation results, the listed company shall hire an asset evaluation institution in line with the provisions of the securities law to issue an asset evaluation report”. The asset appraisal institution of this transaction, Zhongshui Zhiyuan, has relevant securities business qualifications.
In conclusion, the pricing of this transaction is based on the evaluation report issued by Zhongshui Zhiyuan evaluation, an evaluation institution in line with the provisions of the securities law. After the evaluation results are filed by Shanxi state owned Capital Operation Co., Ltd., the transaction parties shall negotiate and determine. Therefore, this transaction complies with the relevant provisions of Article 17 of the reorganization management measures.
3、 Self inspection opinions of land appraisal institutions
After verification, the land appraisal institution believes that:
This institution is a land appraisal institution filed with the Department of natural resources of Shanxi Province in accordance with the asset appraisal law (filing No.: jtgbz [2020] No. 0018), and holds the registration certificate of land appraisal institution (Certificate No.: Jintu Appraisal Association 142018064) issued by Shanxi Association of land appraisers and land registration agents. Therefore, this institution has the business qualification related to land appraisal. The pricing of this transaction is based on the evaluation report issued by Zhongshui Zhiyuan evaluation, an evaluation institution in line with the provisions of the securities law. After the evaluation results are filed by Shanxi state owned Capital Operation Co., Ltd., the trading parties shall negotiate and determine. Therefore, this transaction complies with the relevant provisions of Article 17 of the reorganization management measures.
