THIS PROSPECTUS IS IMPORTANT AND REQUIRES YOUR …

If you are in any doubt as to any aspect of this Prospectus or as to the action to be taken, you should consult your licenced securities dealer,bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your Ordinary Shares in the Company, you should at once hand this Prospectus and the accompanyingApplication Forms to the purchaser or transferee or to the bank, licenced securities dealer or other agent through whom the sale or transferwas effected for transmission to the purchaser or transferee.

A copy of each of the Open Offer Documents, having attached thereto the documents specified in the paragraph headed “Documents deliveredto the Registrar of Companies in Hong Kong” in Appendix IV to this Prospectus, have been registered with the Registrar of Companies inHong Kong pursuant to Section 38D of the Companies (Winding Up and Miscellaneous Provisions) Ordinance. The Registrar of Companiesin Hong Kong and the SFC take no responsibility for the contents of any of those documents.

Shareholders with registered addresses in any of the Specified Territories and the Beneficial Shareholders who are residents of the SpecifiedTerritories are referred to the important information set out in the sections headed “Letter from the Board — Proposed Open Offer — ExcludedShareholders” and “Letter from the Board — Proposed Open Offer - Limited category of persons in the United States who may be able toparticipate in the Open Offer”.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of thisProspectus, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoeverarising from or in reliance upon the whole or any part of the contents of this Prospectus.

The Assured Entitlements, the Assured Allotment Application Forms, the Offered Mandatory Convertible Securities and the ConversionShares have not been and will not be registered under the U.S. Securities Act or the laws of any State in the United States, and may not beoffered or sold within the United States, absent registration or an exemption from the registration requirements of the U.S. Securities Act andapplicable State securities laws. There is no intention to register any portion of any securities described herein in the United States or toconduct a public offering of securities in the United States.

(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 00144)

OPEN OFFER OF UNLISTED MANDATORY CONVERTIBLE SECURITIESON THE BASIS OF ONE UNIT OF UNLISTED

MANDATORY CONVERTIBLE SECURITIES FOR EVERY FIVE (5)ORDINARY SHARES HELD ON THE RECORD DATE

Joint Lead Financial Advisers

Co-Financial Advisers

Terms used in this cover shall have the same meanings as defined in this Prospectus.

The latest time for acceptance of and payment for the Offered Mandatory Convertible Securities is 4:00 p.m. on Thursday, 5 June 2014.The procedures for application and payment, transfer or conversion of the Offered Mandatory Convertible Securities are set out on pages 25to 30 of this Prospectus.

The existing Ordinary Shares of the Company have been dealt with on an ex-entitlement basis since 9:00 a.m. on Wednesday, 14 May 2014.Such dealings in the Ordinary Shares will take place whilst the conditions to which the Open Offer is subject remain unfulfilled. A persondealing in Ordinary Shares on an ex-entitlement basis will accordingly bear the risk that the Open Offer may not become unconditional ormay not proceed.

The Underwriting Agreement contains provisions entitling the Underwriter by notice in writing to the Company served prior to 5:00p.m. on Friday, 6 June 2014 or such other time or date as the Company and the Underwriter may agree in writing to terminate theUnderwriting Agreement on the occurrence of certain events including force majeure as set out in the section headed “Terminationof the Underwriting Agreement” on page 8 of this Prospectus.

If the Underwriter terminates the Underwriting Agreement, or if the conditions of the Underwriting Agreement are not fulfilled (orwaived by the Underwriter) in accordance with the terms thereof, the Open Offer will not proceed. Shareholders should thereforeexercise caution when dealing in the Ordinary Shares, and if they are in any doubt about their position, they are recommended toconsult their professional advisers.

THIS PROSPECTUS IS IMPORTANT AND REQUIRES YOUR IMPORTANT ATTENTION

11.20

A1B113.51A

21 May 2014

The Open Offer is conditional upon the Underwriting Agreement becoming unconditional

and not being terminated. Furthermore, if the conditions of the Open Offer are not fulfilled, the

Open Offer may not proceed, in which case, a further announcement will be made by the

Company at the relevant time. It should also be noted that the Ordinary Shares have been dealt

with on an ex-entitlement basis from Wednesday, 14 May 2014. Such dealings will take place

when the conditions of the Open Offer remain unfulfilled and the Underwriting Agreement is

subject to termination in accordance with the terms thereof. Any person dealing in the securities

of the Company up to the date on which such condition is fulfilled or waived and up to the Latest

Time for Termination (as defined herein) will accordingly bear the risk that the Open Offer may

not become unconditional and may not proceed. Any person dealing or contemplating any

dealing in the securities of the Company during this period who is in any doubt about his or her

position is recommended to consult his or her own professional adviser.

EXCEPT AS OTHERWISE SET OUT HEREIN, THE OPEN OFFER DESCRIBED IN THIS

PROSPECTUS IS NOT BEING MADE TO SHAREHOLDERS OR BENEFICIAL

SHAREHOLDERS IN THE SPECIFIED TERRITORIES. This Prospectus does not constitute or

form part of any offer or invitation to sell or issue, or any solicitation of any offer to acquire, the

Offered Mandatory Convertible Securities or to take up any entitlements to the Offered Mandatory

Convertible Securities in any jurisdiction in which such an offer or solicitation is unlawful. None of

the Offered Mandatory Convertible Securities, the Conversion Shares, this Prospectus, the Assured

Allotment Application Form or the Excess Application Form will be registered under the securities

laws of any of the Specified Territories and none of the Offered Mandatory Convertible Securities, the

Conversion Shares, this Prospectus, the Assured Allotment Application Form or the Excess

Application Form will qualify for distribution under any of the relevant securities laws of any of the

Specified Territories (other than pursuant to any applicable exceptions as agreed by the Company).

Accordingly, the Assured Entitlements, the Assured Allotment Application Forms, the Offered

Mandatory Convertible Securities and the Conversion Shares may not be offered, sold, pledged, taken

up, resold, renounced, transferred or delivered, directly or indirectly, into or within any of the

Specified Territories absent registration or qualification under the respective securities laws of such

Specified Territories, or exemption from the registration or qualification requirement under applicable

rules of such Specified Territories.

Shareholders with registered addresses in any of the Specified Territories and Beneficial

Shareholders who are residents of the Specified Territories are referred to the sections of this

prospectus headed “Letter from the Board — Proposed Open Offer — Excluded Shareholders” and

“Letter from the Board — Proposed Open Offer — Limited category of persons in the United States

who may be able to participate in the Open Offer”.

NOTICE TO CANADIAN INVESTORS

The Offered Mandatory Convertible Securities will not be distributed in Canada. Any resale of

the Offered Mandatory Convertible Securities in Canada must be made under applicable securities

laws which will vary depending on the relevant jurisdiction, and which may require resales to be made

NOTICE

— i —

under available statutory registration and prospectus exemptions, under a discretionary exemption

granted by the applicable Canadian securities regulatory authority or in a transaction not subject to

securities legislation in Canada. Purchasers are advised to seek legal advice prior to any resale of the

Offered Mandatory Convertible Securities.

NOTICE TO INVESTORS IN MACAU

The Open Offer can only be promoted, distributed, sold or delivered in the Macau Special

Administrative Region of the People’s Republic of China (“Macau”), or any document relating to the

Open Offer be distributed or circulated in Macau, by the institutions licensed in Macau according to

the Macau Financial System Act, as authorised by the Macau regulatory authority in observation of

the guidelines and recommendations issued by such authority from time to time. An overseas offer to

existing Macau Shareholders of the Offered Mandatory Convertible Securities will not require special

licensing or authorisation, provided that it does not involve a public offer in Macau or the circulation

of marketing materials in Macau.

NOTICE TO PRC INVESTORS

This Prospectus does not constitute a public offer of the Offered Mandatory Convertible

Securities, whether by way of sale or subscription, in the PRC. According to relevant PRC laws and

regulations, subject to any applicable exemptions, the Offered Mandatory Convertible Securities are

not being offered and may not be offered or sold directly or indirectly in the PRC to, or for the benefit

of, legal or natural persons of the PRC.

In each case, we reserve the absolute discretion in determining whether to allow such

participation as well as the identities of the persons who may be allowed to do so.

NOTICE TO INVESTORS IN THE UNITED KINGDOM

This Prospectus has not been delivered for approval to the Financial Services Authority (“FSA”)

in the United Kingdom nor has it been approved by an authorised person within the meaning of

Financial Services and Markets Act 2000, as amended (“FSMA”). No approved prospectus within the

meaning of section 85 of FSMA or of the Prospectus Directive has been published or is intended to

be published in relation to the Open Offer. Accordingly, the securities referred to in this Prospectus

may not be, and are not being, offered to persons in the United Kingdom except in circumstances

which will not result in an offer to the public in the United Kingdom in contravention of the FSMA

or the Prospectus Directive.

Within the United Kingdom, this Prospectus is only being addressed and distributed to persons

to whom interests may lawfully be promoted pursuant to section 21 of FSMA. In particular, this

Prospectus is being communicated to, and is directed only at: (a) persons (i) having professional

experience in matters relating to investments so as to qualify them as “investment professionals” under

Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the

“Order”); (ii) falling within Article 49(2)(a) to (d) of the Order; or (iii) falling within Article 50 of

the Order, or (b) persons who are “qualified investors” within the meaning of Article 2(1)(e) of the

Prospectus Directive, or (c) persons to whom it may otherwise be lawfully communicated (together

NOTICE

— ii —

being referred to as “Relevant Persons”). This communication must not be acted on or relied on by

persons who are not Relevant Persons. Any investment or investment activity to which this

communication relates is available only to Relevant Persons and will be engaged in only with Relevant

Persons.

NOTICE TO INVESTORS IN THE UNITED STATES

The Assured Entitlements, the Assured Allotment Application Forms, the Offered Mandatory

Convertible Securities and the Conversion Shares have not been and will not be registered under the

U.S. Securities Act or securities laws of any State or other jurisdiction of the United States and may

not be offered, sold, allotted, taken up, exercised, resold, renounced, pledged, transferred or delivered,

directly or indirectly, in or into the United States, except pursuant to an applicable exemption from,

or in a transaction not subject to, the registration requirements of the U.S. Securities Act and in

compliance with any applicable securities laws of any State or other jurisdiction of the United States.

There will be no public offer of any securities in the United States.

The Open Offer Documents, the Offered Mandatory Convertible Securities and theConversion Shares have not been approved or disapproved by the U.S. Securities and ExchangeCommission, any State securities commission in the United States or any U.S. regulatoryauthority, nor have any the foregoing authorities passed upon or endorsed the merits of the OpenOffer, the Open Offer Documents, the Offered Mandatory Convertible Securities or theConversion Shares or the accuracy or adequacy of this document. Any representation to thecontrary is a criminal offence in the United States.

Subject to certain limited exceptions, none of this Prospectus, the Assured Allotment Application

Form or the Excess Application Form constitutes, will constitute, or forms or will form, part of any

offer or invitation or issue, purchase or acquire the Offered Mandatory Convertible Securities to any

person with a registered address, or who is located, in the United States. The Offered Mandatory

Convertible Securities are being offered outside the United States in reliance on Regulation S.

In addition, until 40 days after the commencement of the Open Offer, any offer, sale or transfer

of the Offered Mandatory Convertible Securities or Conversion Shares in or into the United States by

a dealer (whether or not participating in the Open Offer) may violate the registration requirements of

the U.S. Securities Act.

Each subscriber of Offered Mandatory Convertible Securities being offered and sold outside the

United States will be deemed to have represented and agreed, among other things, that the subscriber

is acquiring the Offered Mandatory Convertible Securities in an offshore transaction meeting the

requirements of Regulation S.

Any person (other than the institutional Accredited Investors who are also QIBs referred to in the

immediately following paragraph) subscribing for or accepting Offered Mandatory Convertible

Securities will be required to represent, among others, that such person:

(i) is not resident or located in, or a citizen of, the United States;

NOTICE

— iii —

(ii) it is not accepting an offer to acquire or take up the Offered Mandatory Convertible

Securities on a non-discretionary basis for a person who is resident or located in, or a

citizen of the United States at the time the instruction to accept was given;

(iii) it is not taking up for the account of any person who is located in the United States, unless:

(a) the instruction to take up was received from a person outside the United States; and

(b) the person giving such instruction has confirmed that (x) it has the authority to give

such instruction, and (y) either (A) has investment discretion over such account or (B)

is an investment manager or investment company that it is acquiring the Offered

Mandatory Convertible Securities in an “offshore transaction” within the meaning of

Regulation S;

(iv) it is acquiring the Offered Mandatory Convertible Securities in an “offshore transaction” as

defined in Regulation S;

(v) it has not been offered the Offered Mandatory Convertible Securities by means of any

“directed selling efforts” as defined in Regulation S;

(vi) it is not acquiring Offered Mandatory Convertible Securities with a view to the offer, sale,

transfer, delivery or distribution, directly or indirectly, of such Offered Mandatory

Convertible Securities or Conversion Shares into the United States; and

(vii) it understands that neither the Offered Mandatory Convertible Securities nor the

Conversion Shares have been or will be registered under the U.S. Securities Act or with any

securities regulatory authority of any State, territory, or possession of the U.S. and the

Offered Mandatory Convertible Securities are being distributed and offered outside the U.S.

in reliance on Regulation S. Consequently it understands the Offered Mandatory

Convertible Securities and the Conversion Shares may not be offered, sold, pledged or

otherwise transferred in or into the U.S., except in reliance on an exemption from, or in

transactions not subject to, the registration requirements of the U.S. Securities Act.

Notwithstanding the representations above, the Company may offer the Offered Mandatory

Convertible Securities in the United States to a limited number of persons whom the Company

reasonably believes to be institutional Accredited Investors who are also QIBs in transactions exempt

from the registration requirements under the U.S. Securities Act, provided that such persons fulfil the

relevant requirements to the satisfaction of the Company.

For the avoidance of doubt, neither HKSCC nor HKSCC Nominees Limited is subject to the

representations and warranties above.

FORWARD-LOOKING STATEMENTS

All statements in this Prospectus other than statements of historical fact are forward-looking

statements. In some cases, forward-looking statements may be identified by the use of words such as

NOTICE

— iv —

“might”, “may”, “could”, “would”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”,

“plan”, “seek”, “continue”, “illustration”, “projection” or similar expressions and the negative

thereof. Forward-looking statements in this prospectus include, without limitation, statements in

respect of the Company’s business strategies, product offerings, market position, competition,

financial prospects, performance, liquidity and capital resources, as well as statements regarding

trends in the relevant industries and markets in which the Company operates, technological advances,

financial and economic developments, legal and regulatory changes and their interpretation and

enforcement.

The forward-looking statements in this Prospectus are based on management’s present

expectations about future events. Management’s present expectations reflect numerous assumptions

regarding the Company’s strategy and operations and industry developments. By their nature, they are

subject to known and unknown risks and uncertainties, which could cause actual results and future

events to differ materially from those implied or expressed by forward-looking statements. Should one

or more of these risks or uncertainties materialise, or should any assumptions underlying

forward-looking statements prove to be incorrect, the Company’s actual results could differ materially

from those expressed or implied by forward-looking statements. Additional risks not known to the

Company or that the Company does not currently consider material could also cause the events and

trends discussed in this Prospectus not to occur, and the estimates, illustrations and projections of

financial performance not to be realised.

Prospective investors are cautioned that forward-looking statements speak only as at the date of

publication of this Prospectus. Except as required by applicable laws, the Company does not

undertake, and expressly disclaims, any duty to revise any forward-looking statement in this

Prospectus, be it as a result of new information, future events or otherwise.

NOTICE

— v —

PAGE

Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Expected Timetable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Termination of the Underwriting Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Appendix I — Financial Information of the Group . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Appendix II — Unaudited Pro Forma Financial Information of the Group . . . . . . . . 36

Appendix III — Adjustments to the Conversion Price . . . . . . . . . . . . . . . . . . . . . . . . . 42

Appendix IV — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

CONTENTS

— vi —

In this Prospectus, unless the context otherwise requires, the following expressions have the

following meanings:

“Announcement” the announcement dated 31 March 2014 issued by the

Company in relation to the Open Offer

“Application Form(s)” the Assured Allotment Application Form(s) and the Excess

Application Form(s)

“Articles” the articles of association of the Company

“associate(s)” has the meaning ascribed to it in the Listing Rules

“Assured Allotment Application

Form(s)”

the form(s) of application for use by the Qualifying

Shareholders to apply for their Assured Entitlement of the

Offered Mandatory Convertible Securities

“Assured Entitlement” assured entitlements to Offered Mandatory Convertible

Securities

“Beneficial Shareholder(s)” any beneficial owner(s) of Ordinary Shares whose Ordinary

Shares are registered as shown in the register of members of

the Company in the name of a registered Shareholder

“Board” the board of Directors of the Company

“Business Day(s)” a day (other than a Saturday, a Sunday or a day on which a

tropical cyclone warning signal number 8 or above or a

“black” rainstorm warning signal is hoisted in Hong Kong) on

which banks are generally open for business in Hong Kong

“CCASS” the Central Clearing and Settlement System established and

operated by HKSCC

“CCASS Investor Participant” a person admitted to participate in CCASS as an investor

participant who may be an individual or joint individuals or a

corporation

“CCASS Participant” a CCASS Clearing Participant, CCASS Custodian Participant

or a CCASS Investor Participant

“CMG” China Merchants Group Limited, a company incorporated in

the PRC and the ultimate holding company of the Company

“CMHK” China Merchants Holdings (Hong Kong) Company Limited, a

company incorporated in Hong Kong with limited liability

and the intermediate holding company of the Company

DEFINITIONS

— 1 —

“CMU” China Merchants Union (BVI) Limited, a company

incorporated under the law of British Virgin Islands and a

substantial shareholder of the Company

“Co-Financial Advisers” Standard Chartered Securities (Hong Kong) Limited, China

Development Bank Corporation and China Merchants

Securities (HK) Co., Limited

“Company” China Merchants Holdings (International) Company Limited,

a company incorporated in Hong Kong with limited liability

and whose Ordinary Shares are listed on the Main Board of

the Stock Exchange

“Companies (Winding Up and

Miscellaneous Provisions)

Ordinance”

Companies (Winding Up and Miscellaneous Provisions)

Ordinance (Chapter 32 of the Laws of Hong Kong)

“Conversion Date” the date on which a Conversion Notice is served

“Conversion Shares” the new Ordinary Shares to be allotted and issued to the

holders of Mandatory Convertible Securities upon the

conversion of the Mandatory Convertible Securities

“Converting Securities Holder(s)” holder(s) of Mandatory Convertible Securities who

propose(s) to exercise all or any part of the conversion rights

attached to his/her/its Mandatory Convertible Securities

“Director(s)” the director(s) of the Company

“Excess Application Form” the form of application for use by Qualifying Shareholders to

apply for excess Offered Mandatory Convertible Securities

“Excluded Shareholders” the Shareholders whose registered addresses in the

Company’s register of members as at the Record Date are in

any of the Specified Territories, except for those Shareholders

with addresses in the United States who fulfil the relevant

requirements to the satisfaction of the Company and any

Shareholders or Beneficial Shareholders at that time who are

otherwise known by the Company to be resident in any of the

Specified Territories, except for those Shareholders or

Beneficial Shareholders resident in the United States who

fulfil the relevant requirements to the satisfaction of the

Company

“Group” the Company and its subsidiaries from time to time

“HK$” Hong Kong dollars, the lawful currency of Hong Kong

“Hong Kong” the Hong Kong Special Administrative Region of the PRC

DEFINITIONS

— 2 —

“HKSCC” Hong Kong Securities Clearing Company Limited

“institutional Accredited

Investor”

institutional “accredited investor” as defined in Rule

501(a)(1), (2), (3) and (7) under the U.S. Securities Act

“Intermediary” in relation to a Beneficial Shareholder whose Ordinary Shares

are deposited in CCASS and registered in the name of HKSCC

Nominees Limited, means the Beneficial Shareholder’s

broker, custodian, nominee or other relevant person who is a

CCASS Participant or who has deposited the Beneficial

Shareholder’s Ordinary Shares with a CCASS Participant

“Issue Date” 13 June 2014, being the date of issuance of the Mandatory

Convertible Securities

“Joint Lead Financial Advisers” Merrill Lynch Far East Limited and UBS AG, Hong Kong

Branch

“Last Trading Day” 28 March 2014, being the last trading day before the date of

the Announcement

“Latest Practicable Date” 15 May 2014, being the latest practicable date prior to the

printing of this Prospectus for the purpose of ascertaining

certain information for inclusion therein

“Latest Time for Acceptance” 4:00 pm on 5 June 2014, or such later time or date as may be

agreed between CMU and the Company, being the latest time

for acceptance of, and payment for, the Offered Mandatory

Convertible Securities

“Latest Time for Termination” 5:00 pm on the Business Day after the Latest Time for

Acceptance or such later time or date as may be agreed

between CMU and the Company, being the latest time to

terminate the Underwriting Agreement or such other time as

may be agreed between the Company and CMU

“Listing Rules” The Rules Governing the Listing of Securities on The Stock

Exchange of Hong Kong Limited

“Mandatory Convertible

Securities”

the mandatory convertible securities to be issued by the

Company under the Open Offer with the rights and

restrictions summarised in the sub-section headed “Summary

of the Terms of the Mandatory Convertible Securities”

“Memorandum” the memorandum of association of the Company

DEFINITIONS

— 3 —

“Offered Mandatory Convertible

Securities”

the 505,400,882 units of Mandatory Convertible Securities

proposed to be offered to the Qualifying Shareholders for

subscription under the Open Offer

“Open Offer” the proposed issue by the Company of the Offered Mandatory

Convertible Securities by way of open offer to Qualifying

Shareholders on the basis of one unit of Offered Mandatory

Convertible Securities for every five existing Ordinary Shares

held by the Qualifying Shareholders as determined on the

Record Date

“Open Offer Documents” the Prospectus and the Application Forms

“Ordinary Share(s)” ordinary share(s) in the share capital of the Company

“Overseas Shareholder(s)” the Shareholder(s) whose name(s) appear(s) on the register of

members of the Company on the Record Date and whose

address(es) as shown in the register of members of the

Company on that date is(are) outside Hong Kong

“PRC” The People’s Republic of China which, for the purpose of this

circular excludes Hong Kong, the Macau Special

Administrative Region and Taiwan

“Prospectus” this prospectus issued by the Company specifying details of

the Open Offer

“QIBs” qualified institutional buyers as defined in Rule 144A under

the U.S. Securities Act

“Qualifying Shareholders” the Shareholder(s), other than the Excluded Shareholder(s),

whose name(s) appear(s) on the register of members of the

Company as at the close of business on the Record Date

“Record Date” 20 May 2014, being the record date for determining

entitlements to participate in the Open Offer

“Registrar” Computershare Hong Kong Investor Services Limited, located

at Shops 1712-1716, 17th Floor, Hopewell Centre, 183

Queen’s Road East, Wanchai, Hong Kong, the Company’s

share registrar and registrar for the Mandatory Convertible

Securities

“Regulation S” Regulation S under the U.S. Securities Act

“SFO” the Securities and Futures Ordinance (Chapter 571 of the

Laws of Hong Kong)

“Shareholders” the holders of Ordinary Shares

DEFINITIONS

— 4 —

“Share Options” outstanding options granted under the Share Option Scheme

“Share Option Scheme” collectively, the new share option scheme adopted at the

extraordinary general meeting of the Company held on 9

December 2011 and the share option scheme adopted at the

extraordinary general meeting of the Company held on 20

December 2001 and terminated on 9 December 2011

“Specified Territories” Canada and the United States

“Stock Exchange“ The Stock Exchange of Hong Kong Limited

“Subscription Price” the subscription price of HK$30.26 for each unit of Offered

Mandatory Convertible Securities

“subsidiary(ies)” has the meaning ascribed to this term in the Listing Rules

“U.S.” or “United States” the United States of America, its territories and possessions,

any State of the United States, and the District of Columbia

“U.S. Securities Act” the United States Securities Act of 1933

“Undertaking” the deed of undertaking dated 31 March 2014 provided by

CMG to the Company in connection with the Open Offer

“Underwriter” CMU

“Underwriting Agreement” the underwriting agreement dated 31 March 2014 entered into

between the Company and CMU in relation to the Open Offer

DEFINITIONS

— 5 —

The expected timetable for the Open Offer is set out below:

2014

Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tuesday, 20 May

Despatch of Open Offer Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wednesday, 21 May

Register of members to be re-opened . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Monday, 26 May

Latest time for acceptance of and payment forthe Offered Mandatory Convertible Securities . . . . . . . . . . . . . . . 4:00 p.m. on Thursday, 5 June

Latest time for termination of Underwriting Agreement . . . . . . . . . . . . 5:00 p.m. on Friday, 6 June

Announcement of allotment results of the Open Offer . . . . . . . . . . . . . . . . . . . . Thursday, 12 June

Refund cheques in respect of wholly orpartially unsuccessful applications for excessOffered Mandatory Convertible Securitiesexpected to be despatched on or before . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Friday, 13 June

Certificates for Offered Mandatory Convertible Securities expectedto be despatched on or before . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Friday, 13 June

All dates and times referred to in this Prospectus are Hong Kong local dates and times.Dates or deadlines specified in this Prospectus for events in the timetable for (or otherwise inrelation to) the Open Offer are indicative only and may be extended or varied by the Company.Further announcement(s) will be made in the event that there is any change to the expectedtimetable for the Open Offer.

EFFECT OF BAD WEATHER ON THE LATEST TIME FOR APPLICATION ANDPAYMENT FOR THE OFFERED MANDATORY CONVERTIBLE SECURITIES

If there is a tropical cyclone warning signal no. 8 or above, or a ‘‘black’’ rainstorm warning:

i. before 12:00 noon (Hong Kong time) but no longer in force after 12:00 noon (Hong Kongtime) on the latest date for acceptance of and payment for the Offered MandatoryConvertible Securities in Hong Kong, the Latest Time for Acceptance will be extended to5:00 p.m. (Hong Kong time) on the same day; or

ii. between 12:00 noon and 4:00 p.m. (Hong Kong time) on the latest date for acceptance ofand payment for the Offered Mandatory Convertible Securities in Hong Kong, the LatestTime for Acceptance will be postponed to 4:00 p.m. (Hong Kong time) on the followingBusiness Day which does not have either of those warnings in force at any time between9:00 a.m. and 4:00 p.m.

If the Latest Time for Acceptance does not take place on 5 June 2014, the dates mentioned in thissection above may be affected. The Company will notify the Shareholders by way of announcementson any change to the expected timetable as soon as practicable.

EXPECTED TIMETABLE

— 6 —

A1B18(1)

You should carefully consider all the information in this Prospectus, including the risks anduncertainties described below, before making an investment decision with respect to the MandatoryConvertible Securities.

RISKS RELATED TO THE MANDATORY CONVERTIBLE SECURITIES

Holders of the Mandatory Convertible Securities may not receive the scheduled Distributionsat the Distribution Payment Date or at all.

Holders of the Mandatory Convertible Securities are entitled to fixed coupon payablesemi-annually in accordance with the rates set out in the sub-section headed “Summary of thePrincipal Terms of the Mandatory Convertible Securities - Distributions” in the Letter from the Board.Under the terms and conditions of the Mandatory Convertible Securities, the Company may at its solediscretion elect to defer or cancel any scheduled Distributions. Deferral of a scheduled Distributionmeans that the Company will postpone payment of scheduled Distributions to a date which is later thana Distribution Payment Date, and for the avoidance of doubt, such deferred Distributions shall not bearinterest. If the Company decides to cancel any scheduled Distributions, any Distributions so cancelledare non-cumulative. Therefore, holders of the Mandatory Convertible Securities may not receive anyscheduled Distributions.

The Mandatory Convertible Securities will be mandatorily converted into the Ordinary Shareson the third anniversary following the Issue Date.

Any Mandatory Convertible Securities not converted before 20 trading days prior to themandatory conversion date, being the third anniversary following the Issue Date (the “MandatoryConversion Date”), shall be mandatorily converted into new Ordinary Shares at the Conversion Priceon the Mandatory Conversion Date. The initial Conversion Price is HK$30.26 per Ordinary Share,same as the Subscription Price and represents a premium of 18% to the average closing price perOrdinary Share for the last 5 full trading days up to and including the Last Trading Day. There canbe no assurance that the then prevailing trading price of the Ordinary Shares on the MandatoryConversion Date will be at or higher than the initial Conversion Price. If the then prevailing tradingprice of the Ordinary Shares falls below the Conversion Price when the Mandatory ConvertibleSecurities are mandatorily converted into the Ordinary Shares, holders of the Mandatory ConvertibleSecurities may incur a financial loss.

There is no open market for Mandatory Convertible Securities.

The Mandatory Convertible Securities may be assigned or transferred by their holders withoutrestriction but will not be listed on the Stock Exchange or any other stock exchanges. In order tofacilitate the trading of the Mandatory Convertible Securities, during the period from the Issue Dateto the Mandatory Conversion Date, the Company has arranged for a provider to stand in the marketto provide matching service for the Mandatory Convertible Securities. Further details of this matchingservice are set out in the sub-section headed “Transfer and Conversion of Mandatory ConvertibleSecurities - Matching Service for the Mandatory Convertible Securities” in the Letter from the Board.Such matching service is provided to ensure that holders of the Mandatory Convertible Securities havea platform to resell their Mandatory Convertible Securities. However, there is no assurance that anactive market will develop. If an active market for the Mandatory Convertible Securities does notdevelop, the Mandatory Convertible Securities could trade at a price lower than the Subscription Price,and holders of the Mandatory Convertible Securities may not be able to resell their MandatoryConvertible Securities for an extended period of time, or at all.

RISK FACTORS

— 7 —

TERMINATION OF THE UNDERWRITING AGREEMENT

The Underwriting Agreement contains customary rights of termination. If at any time prior to theLatest Time for Termination certain events have occurred, including (but not limited to):

(i) any matter or circumstance arises as a result of which any of the conditions set out in thesection headed “Conditions of the Underwriting Agreement” below has become incapableof satisfaction as at the required time;

(ii) any breach of any of the representations, warranties or undertakings given by the Companypursuant to the Underwriting Agreement comes to the knowledge of CMU, or there has beena breach on the part of the Company of any other provision of the Underwriting Agreement,or CMU has cause to believe that any such breach has occurred and such breach has notbeen cured to the satisfaction of the Underwriter;

(iii) any event occurs or matter arises or is discovered, which, if it had occurred before the dateof the Underwriting Agreement or before any of the dates or before any time on which therepresentations, warranties and undertakings are deemed to be given by the Company underthe Underwriting Agreement would have rendered any of those representations, warrantiesor undertakings untrue, inaccurate, incomplete or misleading in any material respect, comesto the knowledge of CMU;

(iv) any statement contained in the Prospectus has become or been discovered to be untrue,inaccurate, incomplete or misleading in any material respect;

(v) any matter arises or is discovered which would, if the Prospectus was to be issued at thetime, constitute a material omission therefrom;

(vi) the Company’s application to the Main Board of the Stock Exchange for permission for thelisting of the Conversion Shares on the Stock Exchange is withdrawn by the Companyand/or refused by the Stock Exchange;

(vii) there has occurred, happened, come into effect or become public knowledge any event,series of events or circumstances concerning or relating to (whether or not foreseeable)changes in certain financial, political, economic, legal, tax and market conditions or anyevent of force majeure in certain jurisdictions as set out in the Underwriting Agreement,which, in the sole opinion of CMU:

(A) is or will be, or is likely to be, materially adverse to the general affairs, management,business, financial trading or other condition or prospects of the Group;

(B) has or will have or is likely to have a material adverse impact on the success of theOpen Offer; or

(C) makes it impracticable, inadvisable or inexpedient to proceed with the Open Offer onthe terms and in the manner contemplated in the Announcement and the Open OfferDocuments,

then in any such case CMU may by notice in writing to the Company, served prior to the Latest Timefor Termination, rescind or terminate the Underwriting Agreement.

TERMINATION OF THE UNDERWRITING AGREEMENT

— 8 —

(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 00144)

Executive Directors:Mr. LI Jianhong (Chairman)

Mr. LI Yinquan

Mr. HU Zheng

Mr. MENG Xi

Mr. SU Xingang

Mr. YU Liming

Mr. HU Jianhua (Managing Director)

Mr. WANG Hong

Mr. ZHENG Shaoping

Independent non-executive Directors:Mr. KUT Ying Hay

Mr. LEE Yip Wah Peter

Mr. LI Kwok Heem John

Mr. LI Ka Fai David

Mr. BONG Shu Ying Francis

Registered Office:38th Floor

China Merchants Tower

Shun Tak Centre

168-200 Connaught Road Central

Hong Kong

21 May 2014

To the Qualifying Shareholders and,

for information only, the Excluded Shareholders

Dear Sir or Madam,

OPEN OFFER OF UNLISTED MANDATORY CONVERTIBLE SECURITIES

ON THE BASIS OF ONE UNIT OF UNLISTED

MANDATORY CONVERTIBLE SECURITIES FOR EVERY FIVE (5)

ORDINARY SHARES HELD ON THE RECORD DATE

INTRODUCTION

Reference is made to the Announcement in relation to the Open Offer of the Offered Mandatory

Convertible Securities at the Subscription Price of HK$30.26 per unit of Offered Mandatory

Convertible Securities, on the basis of one unit of Offered Mandatory Convertible Securities for every

five Ordinary Shares held by the Qualifying Shareholders as determined on the Record Date.

The purpose of this Prospectus is to provide you with further details of the Open Offer, including

(i) the procedures for application of and payment for, and transfer and conversion of, the Offered

Mandatory Convertible Securities; (ii) certain financial information of the Group; and (iii) general

information of the Group.

LETTER FROM THE BOARD

— 9 —

2.14A1B36

PROPOSED OPEN OFFER

Issue Statistics

Basis of the Open Offer: One unit of Offered Mandatory Convertible Securities for

every five Ordinary Shares held by Qualifying Shareholders

on the Record Date

Subscription Price for the Offered

Mandatory Convertible

Securities:

HK$30.26 per unit of Offered Mandatory Convertible

Securities

Number of Ordinary Shares in

issue on the Record Date:

2,527,004,412 Ordinary Shares

Offered Mandatory Convertible

Securities proposed to be

issued:

505,400,882 units of Offered Mandatory Convertible

Securities


Securities CMG and its

associates (including CMU)

have undertaken to take up in

respect of its Assured

Entitlement:

278,448,414 units of Offered Mandatory Convertible

Securities


Securities underwritten by

CMU:

All the Offered Mandatory Convertible Securities other than

those which have been undertaken to be subscribed by CMG

and its associates (including CMU), being 226,952,468 units

of Offered Mandatory Convertible Securities

Under the Open Offer, the Offered Mandatory Convertible Securities (if converted into

Conversion Shares) represent approximately 20% of the share capital immediately after completion of

Open Offer.

No part of the share capital or any other securities of the Company is listed or dealt in any other

stock exchange other than the Stock Exchange and no application is being made or is currently

proposed or sought for the Ordinary Shares or any other securities of the Company to be listed or dealt

in any other stock exchange.


— 10 —

A1B10A1B22(1)

A1B6

Summary of the Principal Terms of the Mandatory Convertible Securities

A summary of the principal terms and conditions of the Mandatory Convertible Securities is set

out below.

Subscription Price: HK$30.26 per unit of Mandatory Convertible Securities

Issue Date 13 June 2014

Ranking: The obligations of the Company under the Mandatory

Convertible Securities constitute direct, unsecured and

subordinated obligations. In the event of the winding-up of

the Company, the rights and claims of the holders of the

Mandatory Convertible Securities (the “Holders” and each a

“Holder”) shall be subordinated in right of payment to the

claims of all other present and future senior and subordinated

creditors of the Company, other than Parity Securities and

shall rank senior in right of payment to the Junior Securities.

“Parity Securities” refer to any instrument or security

(including without limitation any preference share) issued,

entered into or guaranteed by the Company which ranks or is

expressed to rank, by its terms or by operation of law, pari

passu with the Mandatory Convertible Securities.

“Junior Securities” refer to Ordinary Shares or any other

securities ranking pari passu therewith and in respect of

which all payments of dividends and other distributions are

discretionary.

Distributions: Fixed coupon payable semi-annually (each a “Distribution”)

in accordance with the following rates and subject to

applicable laws and regulations provided that, in the event of

an Optional Conversion (as defined below) before a

Distribution Payment Date, the relevant Holder shall not be

entitled to any accrued Distribution before the date of the

Optional Conversion and any Distribution to be paid after the

Conversion Date:

Year 1: 8.00% per annum;

Year 2: 6.00% per annum; and

Year 3: 4.00% per annum,

(each a “Distribution Payment Date”).


— 11 —

A1B18(2)

Deferral of Distributions(Note):

The Company may at its sole discretion elect to defer or

cancel any scheduled Distributions by giving notice to the

Holders not more than 60 and not less than 30 Business Days

prior to each relevant Distribution Payment Date. For the

avoidance of doubt, any such deferred Distributions shall not

bear interest and if the Company decides to cancel any

scheduled Distributions, any Distributions so cancelled are

non-cumulative.

Optional Conversion: The Holders shall have the right to convert any of their

Mandatory Convertible Securities into new Ordinary Shares

at any time during the period from (but excluding) the Issue

Date to (and including) the day falling 20 trading days prior

to the Mandatory Conversion Date (the “ConversionPeriod”), subject to the minimum conversion requirement set

out below.

Mandatory Conversion: Any Mandatory Convertible Securities not converted before

20 trading days prior to the Mandatory Conversion Date,

being the third anniversary following the date of issuance of

the Mandatory Convertible Securities, shall be mandatorily

converted on the Mandatory Conversion Date into new

Ordinary Shares at the Conversion Price.

Accelerated MandatoryConversion:

If the Company declares, makes or pays any dividends,

distributions or other payments to the holders of any Junior

Securities or undertake any redemption, reduction,

cancellation, buy-back or acquisition of, any Junior Securities

or Parity Securities (except on a pro rata basis) during the

period when any scheduled Distribution has been deferred or

cancelled, the Company shall notify the Holders and shall

convert all of the outstanding Mandatory Convertible

Securities into new Ordinary Shares at the Conversion Price

and the Company shall pay a cash amount equal to the sum of

the Make-whole Amount and any unpaid Distributions that are

due prior to the conversion date (“Accelerated ConversionDate”).

The Make-whole Amount shall represent the net present value

(NPV) of all Distributions to be made after the Accelerated

Conversion Date calculated pursuant to the following

formula:

M = A x (c/t)

where:

“M” = the Make-whole Amount;


— 12 —

“A” = NPV of total Distributions under the Mandatory

Convertible Securities discounted at the 3-year HKD swap

mid-rate on pricing date plus 200 basis points;

“c” = the number of days from and including the Accelerated

Conversion Date to but excluding the Mandatory Conversion

Date; and

“t” = the number of days from and including the Issue Date to

but excluding the Mandatory Conversion Date.

Conversion Price: HK$30.26 per Ordinary Share, same as the Subscription Price

(subject to adjustments in certain customary circumstances

and certain other market standard dilutive events as set out in

Appendix III headed “Adjustments to the Conversion Price”

in this Prospectus).

Minimum conversionrequirement:

The minimum amount of Mandatory Convertible Securities

which a Holder may convert into Ordinary Shares (the

“Minimum Conversion Multiple”) is such Hong Kong dollar

amount where conversion would result in 2,000 Ordinary

Shares, being 2,000 units representing an aggregate amount of

HK$60,520 based on the initial Conversion Price of

HK$30.26. A Holder may convert a larger amount of

Mandatory Convertible Securities in integral multiples of the

Minimum Conversion Multiple or otherwise all the

Mandatory Convertible Securities held by the Holder. A

Holder holding less than the Minimum Conversion Multiple

may convert his Mandatory Convertible Securities into

Ordinary Shares provided that all the Mandatory Convertible

Securities held by the Holder are converted.

Voting: The Mandatory Convertible Securities do not carry any voting

rights.

Lock-up: No additional equity raising will be conducted by the

Company from the date of the Announcement to 90 days after

the Open Offer closes, except for any new Ordinary Shares to

be issued (i) to the Company’s Ordinary Shareholders

pursuant to its scrip dividend scheme or (ii) as a result of the

exercise of any of the Share Options.

Transferability: The Mandatory Convertible Securities may be assigned or

transferred by the Holders without restriction.


— 13 —

Note: Notwithstanding that under the terms and conditions of the Mandatory Convertible Securities the Company has the

discretion to defer or cancel any scheduled Distributions, the Company has no present intention to exercise such

discretion and the Company will consider, among other things, the then financial and operating conditions of the

Company if and when it decides whether to exercise its discretion to defer or cancel any scheduled Distributions.

Furthermore, based on the current financial and operating conditions of the Company, the Company does not have any

current intention to exercise such discretion. The Company expects that such discretion will only be exercised in

extreme circumstances, including when the Company expects it does not have sufficient cashflow to pay the

Distributions whilst maintaining target gearing level and credit ratings.

Conditions of the Open Offer

Under the Listing Rules, the Open Offer is not subject to the approval of the Ordinary

Shareholders. However, the Open Offer is conditional upon the Underwriting Agreement having

become unconditional and CMU not having terminated the Underwriting Agreement in accordance

with the terms thereof. The conditions to the Underwriting Agreement and the circumstances in which

CMU may terminate the Underwriting Agreement are set out in the sections headed “Conditions of the

Underwriting Agreement” below and “Termination of the Underwriting Agreement” above. If the

conditions to the Open Offer are not fulfilled, the Open Offer will not proceed.

Basis of Open Offer

One unit of Offered Mandatory Convertible Securities for every five Ordinary Shares held by the

Qualifying Shareholders as at the close of business on the Record Date. Acceptance for all or part of

a Qualifying Shareholder’s Assured Entitlement to the Open Offer should be made by completing the

Assured Allotment Application Form and lodging the same with a remittance for the Offered

Mandatory Convertible Securities being accepted.

Fractions of Entitlements to the Offered Mandatory Convertible Securities

Entitlements to the Offered Mandatory Convertible Securities will be rounded down to the

nearest whole unit. Fractional entitlements to the Offered Mandatory Convertible Securities will not

be allotted and will be aggregated and made available for application by the Qualifying Shareholders

who wish to apply for Offered Mandatory Convertible Securities in excess of their own entitlements.

Subscription Price

The Subscription Price is HK$30.26 per unit of Offered Mandatory Convertible Securities,

payable in full on application.

The Subscription Price was determined based on a premium of 18% to the average closing price

per Ordinary Share for the last 5 full trading days up to and including the Last Trading Day, being

HK$25.64, after arm’s length negotiations between the Company and CMU and taking into account the

market environment and the prevailing market prices of the Ordinary Shares. The Subscription Price

represents:

(i) a premium of approximately 27.14% to the average closing price of HK$23.80 per Ordinary

Share quoted on the Stock Exchange on the Latest Practicable Date;


— 14 —

A1B18(2)

(ii) a premium of approximately 13.55% to the closing price of HK$26.65 per Ordinary Share

quoted on the Stock Exchange on the Last Trading Day;

(iii) a premium of approximately 19.13% to the average closing price of HK$25.40 per Ordinary

Share for the last 10 full trading days up to and including the Last Trading Day;

(iv) a premium of approximately 14.75% to the average closing price of HK$26.37 per Ordinary

Share for the last 30 full trading days up to and including the Last Trading Day;

(v) a premium of approximately 11.33% to the average closing price of HK$27.18 per Ordinary

Share for the last 90 full trading days up to and including the Last Trading Day; and

(vi) a premium of approximately 13.29% to the average closing price of HK$26.71 per Ordinary

Share for the last 180 full trading days up to and including the Last Trading Day.

The Directors consider the terms of the Open Offer and the Subscription Price to be fair and

reasonable and are in the interests of the Company and the Ordinary Shareholders as a whole.

Qualifying Shareholders

To qualify for the Open Offer, a Shareholder must:

(a) be registered as a member of the Company on the Record Date; and

(b) not be an Excluded Shareholder.

In order to be registered as members of the Company at the close of business on the Record Date,

all transferees of Ordinary Shares must lodge all transfers of Ordinary Shares (together with the

relevant share certificate(s)) by 4:30 p.m. (Hong Kong time) on Thursday, 15 May 2014 with the

Company’s Registrar, Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th

Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong.

Based on the register of members of the Company as at the close of business on the Record Date,

there were a total of eight Overseas Shareholder(s) with registered addresses located in Canada,

Macau, the PRC, the United Kingdom and the United States holding in aggregate 0.004% of the total

number of issued Ordinary Shares of the Company as at the close of business on the Record Date. The

Directors have, in compliance with Rule 13.36(2) of the Listing Rules, conducted enquiries regarding

the feasibility of extending the Open Offer to such Overseas Shareholder(s).

After making enquiries with the Company’s overseas legal advisers regarding the legal

restrictions under the laws of the relevant jurisdictions and the requirements of the relevant regulatory

bodies or stock exchanges for the Company to offer the Mandatory Convertible Securities to such

Overseas Shareholders in accordance with Rule 13.36(2) of the Listing Rules, the Directors have been

advised by the legal advisers in the relevant jurisdictions that either (i) there is no legal restriction

under the applicable legislation of the relevant jurisdictions or requirement of any relevant regulatory

body or stock exchange with respect to extending the Open Offer to the Overseas Shareholders with


— 15 —

A1B18(2)

registered addresses in Macau, the PRC and the United Kingdom or (ii) the Company would be exempt

from obtaining approval from, and/or registration of the Open Offer Documents with, the relevant

regulatory authorities under the applicable laws and regulations of these jurisdictions. Accordingly,

the Open Offer will be extended to the Overseas Shareholders with registered addresses in Macau, the

PRC and the United Kingdom.

Excluded Shareholders

Excluded Shareholders are Overseas Shareholders and Shareholders or Beneficial Shareholders

who are otherwise known by the Company to be residents in places outside Hong Kong, and in respect

of whom the Directors, based on enquiries made by the Directors, consider it necessary or expedient

not to extend the Open Offer to such Shareholders or Beneficial Owners on account either of the legal

and/or regulatory restrictions under the laws of the relevant jurisdictions in which such Shareholders

or Beneficial Shareholders (as the case may be) are located or the requirements of the relevant

regulatory body or stock exchange in those relevant jurisdictions. The Open Offer has not been, and

will not be, extended to the Excluded Shareholders.

In accordance with Rule 13.36(2)(a) of the Listing Rules, the Board has made enquiries with the

Company’s overseas legal advisers regarding the legal restrictions under the applicable securities

legislation of the relevant jurisdictions including the Specified Territories and the requirements of the

relevant regulatory bodies or stock exchanges with respect to the offer of the Mandatory Convertible

Securities to the Shareholders in those territories. Based on the legal advice of the Company’s legal

advisers in relation to the laws of the Specified Territories, the extension of the Open Offer to the

Overseas Shareholders with registered addresses in the Specified Territories would, or might, in the

absence of compliance with relevant registration and/or filings and/or other special formalities in the

Specified Territories, be unlawful or impracticable, and the compliance with the registration and other

special formalities in the Specified Territories could be both costly, time-consuming or impracticable,

and therefore inexpedient to do so. Having considered the circumstances, likely costs, time involved

and impracticability if overseas compliance was to be observed in the Specified Territories, the

Directors are of the view that the costs and/or time involved and/or impracticability of overseas

compliance would outweigh the benefits which the Company and its Shareholders as a whole would

receive by including the Overseas Shareholders in the Specified Territories in the Open Offer and have

therefore decided not to extend the Open Offer to the Overseas Shareholders with registered addresses

in the Specified Territories. The attention of Shareholders with registered addresses in the United

States or holding Ordinary Shares on behalf of persons with such addresses is drawn to the section

headed “Limited category of persons in the United States who may be able to participate in the Open

Offer” below.

Accordingly, for the purposes of the Open Offer, the Excluded Shareholders are:

(a) Shareholders whose name(s) appeared in the register of members of the Company at the

close of business on the Record Date and whose address(es) as shown on such register is/are

in any of the Specified Territories, except those Shareholders with addresses in the United

States who fulfil the relevant requirements to the satisfaction of the Company; and


— 16 —

(b) any Shareholder(s) or Beneficial Shareholder(s) at that time who is/are otherwise known by

the Company to be residents in any of the Specified Territories, except for those

Shareholders or Beneficial Shareholders resident in the United States who fulfil the

relevant requirements to the satisfaction of the Company.

Notwithstanding any other provision in this Prospectus or the Assured Allotment Application

Form or the Excess Application Form, the Company reserves the right to permit any Shareholder to

take up his/her/its entitlement to Offered Mandatory Convertible Securities if the Company, in its

absolute discretion, is satisfied that the transaction in question is exempt from or not subject to the

legislation or regulations or requirements giving rise to the restrictions in question.

In any event, it is the responsibility of any person (including but without limitation to custodian,

nominee, agent and trustee) receiving the Open Offer Documents outside Hong Kong and wishing to

take up the Offered Mandatory Convertible Securities under the Open Offer to satisfy

himself/herself/itself as to the full observance of the laws of the relevant territory or jurisdiction,

including obtaining any governmental or other consents or observing any other formalities which may

be required in such territory or jurisdiction, and to pay any taxes, duties and other amounts required

to be paid in such territory or jurisdiction in connection with taking up any Offered Mandatory

Convertible Securities.

Each subscriber (including but without limitation to custodian, nominee, agent and trustee) of

Offered Mandatory Convertible Securities being offered and sold outside the U.S. will be deemed (by

accepting delivery of this Prospectus) to have given each of the following representations and

warranties to the Company and to any person acting on their behalf, unless in its sole discretion the

Company waives such requirement:

• He/she/it was a Shareholder as at the Record Date;

• He/she/it may lawfully be offered, take up, obtain, subscribe for and receive the Offered

Mandatory Convertible Securities in the jurisdiction in which he/she/it resides or is

currently located;

• Subject to certain exceptions, he/she/it is not resident or located in, or a citizen of, the

United States;

• Subject to certain exceptions, he/she/it is not accepting an offer to acquire or take up the

Offered Mandatory Convertible Securities on a non-discretionary basis for a person who is

resident or located in, or a citizen of the United States at the time the instruction to accept

was given;


— 17 —

• He/she/it is not taking up for the account of any person who is located in the United States,

unless:

(i) the instruction to take up was received from a person outside the United States; and

(ii) the person giving such instruction has confirmed that (x) it has the authority to give

such instruction, and (y) either (A) has investment discretion over such account or (B)

is an investment manager or investment company that it is acquiring the Offered

Mandatory Convertible Securities in an “offshore transaction” within the meaning of

Regulation S;

• He/she/it is acquiring the Offered Mandatory Convertible Securities in an “offshore

transaction” as defined in Regulation S;

• He/she/it has not been offered the Offered Mandatory Convertible Securities by means of

any “directed selling efforts” as defined in Regulation S;

• He/she/it is not acquiring Offered Mandatory Convertible Securities with a view to the

offer, sale, transfer, delivery or distribution, directly or indirectly, of such Offered

Mandatory Convertible Securities or Conversion Shares into the United States; and

• He/she/it understands that neither the Offered Mandatory Convertible Securities nor the

Conversion Shares have been or will be registered under the U.S. Securities Act or with any

securities regulatory authority of any State, territory, or possession of the U.S. and the

Offered Mandatory Convertible Securities are being distributed and offered outside the U.S.

in reliance on Regulation S. Consequently he/she/it understands the Offered Mandatory

Convertible Securities and the Conversion Shares may not be offered, sold, pledged or

otherwise transferred in or into the U.S., except in reliance on an exemption from, or in

transactions not subject to, the registration requirements of the U.S. Securities Act.

For the avoidance of doubt, neither HKSCC nor HKSCC Nominees Limited is subject to the

representations and warranties above.

Furthermore, any acceptance of the Offered Mandatory Convertible Securities by any person will

be deemed to constitute a representation and warranty from such person to the Company that those

local laws and requirements of the relevant territory or jurisdiction have been fully complied with. If

you are in any doubt as to your position, you should consult your professional advisers. Any Offered

Mandatory Convertible Securities which would otherwise have been comprised in the Assured

Entitlements of the Excluded Shareholders will be available for application by the Qualifying

Shareholders who wish to apply for Offered Mandatory Convertible Securities in excess of their own

Assured Entitlements.


— 18 —

Limited category of persons in the United States who may be able to participate in the Open

Offer

Notwithstanding what is said in the section headed “Excluded Shareholders” above, a limited

number of Shareholders and Beneficial Shareholders in the United States who the Company

reasonably believes are institutional Accredited Investors who are also QIBs may be able to subscribe

for the Offered Mandatory Convertible Securities being offered in the Open Offer in transactions

exempt from registration requirements under the U.S. Securities Act, provided they fulfil relevant

requirements to the satisfaction of the Company. In any event, the Company reserves absolute

discretion in determining whether to allow such participation as well as the identity of the persons who

may be allowed to do so.

Distribution of the Open Offer Documents

The Company will send the Open Offer Documents to the Qualifying Shareholders on

Wednesday, 21 May 2014.

Distribution of the Open Offer Documents into jurisdictions other than Hong Kong may be

restricted by law. Any person who receives the Open Offer Documents (including, without limitation,

any agent, custodian, nominee and trustee) should be aware of and comply with the applicable

restriction in the relevant jurisdiction(s). Failure to comply with any applicable restrictions may

constitute a violation of the securities laws of the relevant jurisdiction. Any Shareholder or Beneficial

Shareholder who is in doubt as to his/her/its position should consult an appropriate professional

adviser without delay. In particular, subject to certain exceptions as determined by the Company, this

Prospectus should not be distributed, forwarded to or transmitted in, into or from any of the Specified

Territories together with the Assured Allotment Application Form or the Excess Application Form.

The Open Offer Documents will not be registered in any jurisdiction other than Hong Kong.

Certificates for the Offered Mandatory Convertible Securities

Subject to the fulfilment of the conditions of the Open Offer, certificates for fully-paid Offered

Mandatory Convertible Securities are expected to be posted to successful applicants at their own risk

on or before 13 June 2014. The principal amount of the certificates for Offered Mandatory Convertible

Securities will be in Hong Kong dollar amount determined based on the Subscription Price of

HK$30.26 per unit of Offered Mandatory Convertible Securities. Refund cheques in respect of wholly

or partially unsuccessful applications for Offered Mandatory Convertible Securities in excess of

Assured Entitlements are also expected to be posted on or before 13 June 2014 by ordinary post to the

applicants at their own risk.


— 19 —

Application for Listing

No application will be made for the listing of, and permission to deal in, the Offered Mandatory

Convertible Securities on the Stock Exchange or any other stock exchanges. The Company will apply

to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the

Conversion Shares issuable upon the conversion of the Offered Mandatory Convertible Securities.

Dealings in the Conversion Shares on the Stock Exchange will be subject to the payment of the

applicable stamp duty, the Stock Exchange trading fee, the transaction levy payable to the Securities

and Futures Commission, or any other applicable fees and charges in Hong Kong.

Outstanding Share Options

As at the Latest Practicable Date, the Company has outstanding Share Options which upon

exercise in full would require the Company to issue and allot an aggregate of 22,147,000 new Ordinary

Shares.

In accordance with the terms of the Share Option Scheme, the number of Ordinary Shares

comprised in each Share Option and/or the option price may be adjusted in such manner as the Board

may deem appropriate as a result of the Open Offer. If the Board decides to make any adjustment, it

will, in accordance with the terms of the Share Option Scheme, engage the auditor of the Company

or an independent financial adviser to confirm whether in their opinion the adjustments proposed are

fair and reasonable. The Company will make a further announcement about the adjustments in due

course.

Save as aforesaid, the Company has no other outstanding convertible securities, options or

warrants in issue which confer any right to subscribe for, convert or exchange into Ordinary Shares

as at the Latest Practicable Date.

UNDERWRITING ARRANGEMENTS

Undertaking to Subscribe for Assured Entitlement

As at the Latest Practicable Date, CMG and its associates (including CMU) are, in aggregate,

interested in 1,392,242,072 Ordinary Shares, representing approximately 55.1% of the total number of

Ordinary Shares of the Company in issue. CMG and its associates (including CMU) will receive their

pro rata entitlement to the Offered Mandatory Convertible Securities in respect of the Ordinary Shares

in which they are interested. Pursuant to the Undertaking, CMG has irrevocably undertaken to the

Company that it will procure its associates (other than CMU) to subscribe, in full their Assured

Entitlement under the Open Offer, and lodge acceptance for such Offered Mandatory Convertible

Securities that will constitute their entitlement. In addition, CMU has also irrevocably undertaken to

the Company in the Underwriting Agreement that (i) it will subscribe in full its Assured Entitlement

under the Open Offer and lodge acceptance for its Assured Entitlement of Offered Mandatory

Convertible Securities; and (ii) it will not sell, contract to sell, or otherwise transfer or dispose of

either directly or indirectly, conditionally or unconditionally, any of such Offered Mandatory

Convertible Securities subscribed under the Open Offer during the period from (and including) the

Issue Date to (and including) the Mandatory Conversion Date.


— 20 —

A1B9(1)

A1B18(3)

Underwriting Agreement

As at the Latest Practicable Date, CMU, an associate of CMG in which CMG holds 50% interest,

is interested in 572,652,008 Ordinary Shares, representing approximately 22.7% of the total number

of Ordinary Shares in issue. Pursuant to the Underwriting Agreement, CMU has agreed (i) to

underwrite the Offered Mandatory Convertible Securities other than those which have been undertaken

to be subscribed by CMG and its associates; and (ii) not to sell, contract to sell, or otherwise transfer

or dispose of either directly or indirectly, conditionally or unconditionally, any of such underwritten

Offered Mandatory Convertible Securities during the period from (and including) the Issue Date to

(and including) the Mandatory Conversion Date. The Directors are of the view that the Underwriting

Agreement has been entered into on normal commercial terms and the principal terms of the

Underwriting Agreement are set out below:

Date: 31 March 2014

Underwriter: China Merchants Union (BVI) Limited

CMU is principally engaged in investment holding and its

ordinary course of business does not include the underwriting

of securities.

Total number of Offered

Mandatory Convertible

Securities underwritten (Note):

All the Offered Mandatory Convertible Securities other than

those which have been undertaken to be subscribed by CMG

and its associates (including CMU), being 226,952,468 units

of Offered Mandatory Convertible Securities

Commission payable to the

Underwriter:

Nil

Note: These figures excludes the entitlement to 114,530,402 units of Offered Mandatory Convertible Securities in respect of

the beneficial holding of CMU in the Ordinary Shares, which CMU has undertaken to subscribe for in full pursuant to

the Underwriting Agreement, and the entitlement to 163,918,012 units of Offered Mandatory Convertible Securities in

respect of the beneficial holding of CMG and its associates (other than CMU) in the Ordinary Shares, which CMG has

undertaken to procure its associates (other than CMU) to subscribe, pursuant to the Undertaking.

Conditions of the Underwriting Agreement

The obligations of CMU under the Underwriting Agreement are conditional upon, amongst other

things:

(i) the Listing Committee of the Stock Exchange granting listing of, and permission to deal in,

the Conversion Shares either unconditionally or subject to such conditions which the

Company accepts and the satisfaction of such conditions (if any and where relevant) by no

later than three business days after the Record Date, and such approval not having been

withdrawn or revoked on or prior to the Latest Time for Termination;


— 21 —

7.24(3)

(ii) the Stock Exchange issuing a certificate authorising registration of the Prospectus with the

Hong Kong Companies Registry in accordance with section 342C of the Companies

(Winding Up and Miscellaneous Provisions) Ordinance not later than the Record Date (or

such later time and/or date as the Company and CMU may agree in writing) and, following

registration of the Prospectus as referred to in paragraph (iii) below, a copy of the

Prospectus having been published on the HKExnews website not later than the second

Business Day following the Record Date (or such later time and/or date as the Company and

CMU may agree in writing);

(iii) a duly certified copy of the Prospectus (and other required documents) having been lodged

with the Hong Kong Companies Registry not later than the Record Date, and the Hong

Kong Companies Registry issuing a confirmation of registration letter not later than the

Record Date;

(iv) none of the Company’s representations, warranties or undertakings contained in the

Underwriting Agreement being breached, untrue, inaccurate or misleading in any material

respect; and

(v) compliance by the Company with its obligations under the Underwriting Agreement.

The Company shall use its best endeavours to procure the fulfilment of each of the conditions

set out above. In particular, the Company shall furnish such information, supply such documents, pay

such fees, give such undertakings and do all such acts and things as may reasonably be required by

CMU and the Stock Exchange in connection with the matters contemplated in the Underwriting

Agreement.

CMU may at any time in writing waive any of the conditions set out in paragraphs (iv) and (v)

above or extend the time or date for fulfilment of any of the above conditions (in which case a

reference in the Underwriting Agreement to the time or date for the satisfaction of such condition shall

be to its fulfilment by the time or date as so extended) and such waiver or extension may be made

subject to such terms and conditions as determined by CMU.

If any of the conditions set out above (which has not previously been waived by CMU if capable

of being waived under the Underwriting Agreement) is not fulfilled, or becomes incapable of

fulfilment, at or before the time and date specified therein or, in the absence of such specification, the

Latest Time for Termination (or, in any such case, such later date or dates as CMU may agree with

the Company in writing), the Underwriting Agreement (save in respect of certain rights and

obligations under the Underwriting Agreement) shall terminate and no party will have any claim

against any other for costs, damages, compensation or otherwise, provided that such termination shall

be without prejudice to the rights of the parties in respect of any breach of the Underwriting

Agreement occurring prior to such termination.


— 22 —

CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY ARISING FROM

THE OPEN OFFER

The shareholding structure of the Company as at the Latest Practicable Date and immediately

after completion of the Open Offer is set out below:

As the Latest Practicable Date andbefore completion of the Open Offer

No. of

Ordinary Shares %

No. of units

of Mandatory

Convertible

Securities

CMG and its associates

(excluding CMU) 819,590,064 32.4 —

CMU 572,652,008 22.7 —

CMG and its associates 1,392,242,072 55.1 —

Public 1,134,762,340 44.9 —

Total 2,527,004,412 100.0 —

Immediately after completion of Open Offer,

assuming all the Offered Mandatory Convertible

Securities are taken up by Qualifying

Shareholders


assuming all the Offered Mandatory Convertible

Securities are taken up by Qualifying

Shareholders and the Offered Mandatory

Convertible Securities are converted in full (note)

No. of

Ordinary Shares %

No. of units

of Mandatory

Convertible

Securities

No. of

Ordinary Shares %

No. of units

of Mandatory

Convertible

Securities

CMG and its

associates

(excluding

CMU) 819,590,064 32.4 163,918,012 983,508,076 32.4 —

CMU 572,652,008 22.7 114,530,402 687,182,410 22.7 —

CMG and its

associates 1,392,242,072 55.1 278,448,414 1,670,690,486 55.1 —

Public 1,134,762,340 44.9 226,952,468 1,361,714,808 44.9 —

Total 2,527,004,412 100.0 505,400,882 3,032,405,294 100.0 —


— 23 —


assuming none of the Offered Mandatory

Convertible Securities are taken up by Qualifying

Shareholders (except CMG and its associates)


assuming none of the Offered Mandatory

Convertible Securities are taken up by Qualifying

Shareholders (except CMG and its associates) and

the Offered Mandatory Convertible Securities are

converted in full (note)

No. of

Ordinary Shares %

No. of units

of Mandatory

Convertible

Securities

No. of

Ordinary Shares %

No. of units

of Mandatory

Convertible

Securities

CMG and its

associates

(excluding

CMU) 819,590,064 32.4 163,918,012 983,508,076 32.4 —

CMU 572,652,008 22.7 341,482,870 914,134,878 30.2 —

CMG and its

associates 1,392,242,072 55.1 505,400,882 1,897,642,954 62.6 —

Public 1,134,762,340 44.9 — 1,134,762,340 37.4 —

Total 2,527,004,412 100.0 505,400,882 3,032,405,294 100.0 —

Note: The figures also assume that all Shareholders are Qualifying Shareholders.

WARNING OF THE RISKS OF DEALING IN ORDINARY SHARES

The Open Offer is conditional upon the Underwriting Agreement having become

unconditional and CMU not having terminated the Underwriting Agreement in accordance with

the terms thereof. The conditions to the Underwriting Agreement and the circumstances in which

CMU may terminate the Underwriting Agreement are set out in the paragraphs headed

“Conditions of the Open Offer” and “Conditions of the Underwriting Agreement” above and the

section headed “Termination of the Underwriting Agreement” above. If the conditions to the

Open Offer are not fulfilled, the Open Offer will not proceed.

Any persons contemplating buying or selling Ordinary Shares from the date of the

Announcement up to the date on which all the conditions of the Open Offer are fulfilled bear the

risk that the Open Offer may not become unconditional or may not proceed. Potential investors

should exercise caution when dealing in Ordinary Shares, and if they are in any doubt about their

position, they are recommended to consult their professional adviser(s).


— 24 —

APPLICATION FOR ASSURED ENTITLEMENT TO OFFERED MANDATORY

CONVERTIBLE SECURITIES

The Assured Allotment Application Form is enclosed with this Prospectus which entitles

Qualifying Shareholders to whom it is addressed to apply for the number of units of Offered

Mandatory Convertible Securities on an assured basis as shown therein subject to payment in full by

the Latest Time for Acceptance. Qualifying Shareholders should note that they may apply on an

assured basis for any number of Offered Mandatory Convertible Securities only up to the number set

out in the Assured Allotment Application Form.

If Qualifying Shareholders wish to apply for all of their Assured Entitlements to the Offered

Mandatory Convertible Securities as specified in the Assured Allotment Application Form or wish to

apply for any number less than their Assured Entitlement under the Open Offer, they must complete,

sign and lodge the Assured Allotment Application Form in accordance with the instructions printed

thereon, together with remittance for the full amount payable in respect of such number of Offered

Mandatory Convertible Securities they have applied for with Computershare Hong Kong Investor

Services Limited, the Registrar, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road

East, Wanchai, Hong Kong by no later than 4:00 p.m. on Thursday, 5 June 2014. All remittance(s) must

be made in Hong Kong dollars and cheques must be drawn on an account with, or banker’s cashier

orders must be issued by, a licensed bank in Hong Kong and made payable to “CHINA MERCHANTS

HOLDINGS (INTL) CO LTD — PAL” and crossed “Account Payee Only”.

It should be noted that unless the duly completed and signed Assured Allotment Application

Form, together with the appropriate remittance, have been lodged with the Registrar by no later

than 4:00 p.m. on Thursday, 5 June 2014, the Assured Entitlement under the Open Offer and all

rights in relation thereto shall be deemed to have been declined and will be cancelled.

APPLICATION FOR EXCESS OFFERED MANDATORY CONVERTIBLE SECURITIES

Qualifying Shareholders will have the right to apply for Offered Mandatory Convertible

Securities in excess of their own Assured Entitlements under the Excess Application Form, but are not

assured of being allocated any Offered Mandatory Convertible Securities in excess of those comprised

in their Assured Entitlements.

Any Offered Mandatory Convertible Securities (i) not taken up by the Qualifying Shareholders

in accordance with their proportional allocation; (ii) to which the Excluded Shareholders would

otherwise have been entitled; or (iii) created by the aggregation of fractional Offered Mandatory

Convertible Securities, will be made available for excess applications by Qualifying Shareholders.

The Directors will allocate the Offered Mandatory Convertible Securities in excess of Assured

Entitlement at their discretion, but on a fair and equitable basis, to Qualifying Shareholders who have

applied for excess Offered Mandatory Convertible Securities on a pro rata basis with reference to the

units of excess Offered Mandatory Convertible Securities applied for by the relevant Qualifying


— 25 —

Shareholders. For the avoidance of doubt, the allocation of the Offered Mandatory Convertible

Securities in excess of Assured Entitlement will not be based on the number of the Ordinary Shares

held by the relevant Qualifying Shareholders and no preference will be given to topping-up odd lots

to whole board lots.

The Board will regard any nominee company whose name appears on the register of members of

the Company (“Registered Nominee Company”) as a single shareholder. Beneficial owners who hold

their Ordinary Shares through a Registered Nominee Company are advised to consider whether they

would like to arrange registration of their Ordinary Shares in their own names prior to the relevant

book close period.

Application for excess Offered Mandatory Convertible Securities may be made by completing

and signing the enclosed Excess Application Form in accordance with the instructions printed thereon

and lodging it, together with a separate remittance for the full amount payable on application in

respect of the excess Offered Mandatory Convertible Securities applied for, with Computershare Hong

Kong Investor Services Limited, the Registrar, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183

Queen’s Road East, Wanchai, Hong Kong no later than 4:00 p.m. on Thursday, 5 June 2014. All

remittances must be made in Hong Kong dollars and cheques must be drawn on an account with, and

banker’s cashier orders must be issued by, a licensed bank in Hong Kong and made payable to

“CHINA MERCHANTS HOLDINGS (INTL) CO LTD — EAF” and crossed “Account Payee Only”.

All cheques or banker’s cashier orders will be presented for payment upon receipt and all interest

earned on such monies, if any, will be retained for the benefit of the Company. Completion and return

of the Excess Application Form together with a cheque or banker’s cashier order in payment for the

excess Offered Mandatory Convertible Securities applied for will constitute a warranty by the

applicant that the cheque or banker’s cashier order will be honoured on first presentation. If the

cheque or banker’s cashier order is dishonoured on first presentation, the application for excess

Offered Mandatory Convertible Securities is liable to be rejected.

If no excess Offered Mandatory Convertible Securities are allotted to the Qualifying

Shareholders, the amount tendered on application is expected to be returned to such Qualifying

Shareholders in full without interest by ordinary post at their own risk to their registered addresses

on or before 13 June 2014. If the number of excess Offered Mandatory Convertible Securities allotted

to the Qualifying Shareholders is less than that applied for, the surplus application money is also

expected to be returned to them by ordinary post at their own risk to their registered addresses on or

before 13 June 2014.

The Excess Application Form is for use only by the person(s) to whom it is addressed and is not

transferable. All documents, including cheques or banker’s cashier orders for amounts due, will be

sent at the risk of the persons entitled thereto to their registered addresses by the Registrar.


— 26 —

If the conditions of the Open Offer are not fulfilled by the Latest Time for Termination, the Open

Offer will not proceed and the monies received in respect of application for excess Offered Mandatory

Convertible Securities without interest will be returned to the applicants by means of cheques crossed

“Account Payee Only” to be despatched by post to their registered addresses and, in the case of joint

applicants, to the registered address of the applicant whose name appears first on the register of

members of the Company, at the risk of such applicants, on or before 13 June 2014.

TRANSFER AND CONVERSION OF THE MANDATORY CONVERTIBLE SECURITIES

Persons holdings the Mandatory Convertible through CCASS

The Mandatory Convertible Securities will not be listed on the Stock Exchange (or any other

stock exchange). Accordingly, the Mandatory Convertible Securities will not be accepted as eligible

securities by HKSCC for deposit, clearance or settlement in CCASS. The Mandatory Convertible

Securities received by any persons holding their Ordinary Shares through CCASS will initially be held

in the name of HKSCC Nominees Limited. HKSCC will not however provide any transfer or

conversion services in respect of any Mandatory Convertible Securities. Any person holding any

Mandatory Convertible Securities through HKSCC Nominees Limited must arrange for withdrawal of

such Mandatory Convertible Securities from CCASS and the registration of the Mandatory

Convertible Securities in his own name. Once the Mandatory Convertible Securities have been

withdrawn from CCASS and registered in the name of the Holder or his/her/its designated CCASS

Participant or Intermediary, the Holder can transfer the Mandatory Convertible Securities or convert

the Mandatory Convertible Securities into Ordinary Shares pursuant to the procedures set out below.

Procedures for transfer of the Mandatory Convertible Securities

The Registrar is appointed as the transfer agent to receive documents in respect of the splitting

and registration of transfer of the Mandatory Convertible Securities.

A transfer of the Mandatory Convertible Securities shall be effected by completing and signing

an instrument of transfer by both the transferor and transferee after stamping under the hand of their

officers duly authorised in writing or otherwise by a duly authorised person. The form of transfer can

be obtained at the office of the Registrar at 17M Floor, Hopewell Centre, 183 Queen’s Road East,

Wanchai, Hong Kong.

The certificates for the Mandatory Convertible Securities must be delivered for registration

during normal business hours (Monday to Friday: 9:00 a.m. to 4:30 p.m.) at the office of the Registrar,

Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong,

accompanied by (i) a duly executed transfer form; (ii) in case of the execution of the transfer form on

behalf of a corporation by its officers, the authority of that person or those persons to do so; and (iii)

such other evidence (including legal opinions) as the Company may reasonably require if the transfer

form is executed by some other persons on behalf of the Holders. The Company shall, within 10

Business Days of receipt of such documents by the Registrar from the Holders, cancel the existing

certificate and issue a new certificate of the Mandatory Convertible Securities in favour of the

transferee or assignee as applicable.


— 27 —

A1B21(2)

Each new certificate to be issued upon a transfer of the Mandatory Convertible Securities will

be made available for personal collection by the holder entitled thereto during normal business hours

(Monday to Friday: 9:00 a.m. to 4:30 p.m.) at the office of the Registrar, Shops 1712-1716, 17th Floor,

Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, from the 10th Business Day onwards

following receipt of the documents specified above by the Registrar and upon production of such

identification papers as may be reasonably requested by the Company or the Registrar.

Any Holder wishing to transfer only part of his holding of Mandatory Convertible Securities

evidenced by a certificate must first split the certificate by lodging it with the Registrar. A fee will

be charged by the Registrar for the splitting of Mandatory Convertible Securities certificates,

currently being HK$2.50 per certificate using the 10 Business Days’ service. The new Mandatory

Convertible Securities certificates will be made available for personal collection by such holder


Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, from

the 10th Business Day onwards following receipt of the documents specified above by the Registrar

and upon production of such identification papers as may be reasonably requested by the Company or

the Registrar.

Registration of transfer of the Mandatory Convertible Securities will be effected upon (a)

payment of a fee of HK$2.50 (or such higher amount as may from time to time be allowed by the Stock

Exchange) for each certificate cancelled or each new certificate issued, whichever number of

certificates cancelled/issued is higher; and (b) payment in respect of any tax, stamp or other

governmental charges which may be imposed in relation to such transfer. Both charges shall be borne

by the Holder or transferee who lodges the request with the Registrar.

Matching Service for the Mandatory Convertible Securities

In order to facilitate the trading of the Mandatory Convertible Securities, the Company has

appointed South China Securities Limited as the designated broker to arrange for the matching of the

sales and purchases of Mandatory Convertible Securities on a best-effort basis during the period from

the Issue Date of the Mandatory Convertible Securities to the Mandatory Conversion Date. Holders

or other potential purchasers of Mandatory Convertible Securities who wish to take advantage of this

facility to dispose of or purchase Mandatory Convertible Securities should contact Ms. Michelle Lee

of South China Securities Limited at 28/F, Bank of China Tower, No. 1, Garden Road, Central, Hong

Kong at (852) 2111 2222 during the trading hours in each trading day of the Stock Exchange who will

be able to provide the relevant information to the Holders or potential purchasers in connection with

such matching service (including information on how to utilise the matching service and the current

trading price (if any) of the Mandatory Convertible Securities).

Any person who wishes to use this matching platform (whether as transferor or transferee) must

open a securities trading account with South China Securities Limited. Alternatively, if Mandatory

Convertible Securities are held through a CCASS Participant, the CCASS Participant can use this

matching platform on behalf of such person (whether as transferor or transferee) so long as the CCASS

Participant maintains a Professional Investor (Type A) account with South China Securities Limited.

CCASS participants should note that they are required to withdraw the Mandatory Convertible

Securities from CCASS before they can use the matching platform provided by South China Securities


— 28 —

Limited. The matching service provided by South China Securities Limited operates within the trading

hours in each trading day of the Stock Exchange. All price quotes for the Mandatory Convertible

Securities are based on matching instructions from the transferor or transferee. Successful matching

of the sale and purchase of the Mandatory Convertible Securities is not guaranteed. Upon completion

of matching of the Mandatory Convertible Securities, all matched instructions will be subject to stamp

duty and the applicable fees payable to Computershare Hong Kong Investor Services Limited (the

Registrar of the Company) and South China Securities Limited. Holders and potential purchasers of

Mandatory Convertible Securities should note that successful matching of the sale and purchase of the

Mandatory Convertible Securities is not guaranteed and they are recommended to consult their

professional advisers if there are any doubt about this matching service.

Procedures for exercise of the conversion rights attached to the Mandatory ConvertibleSecurities

The Converting Securities Holder(s) may, subject to the minimum conversion requirement set out

in the paragraph headed “Summary of the Principal Terms of the Mandatory Convertible Securities”

above, on any Business Day within the Conversion Period, exercise the conversion rights attached to

such Mandatory Convertible Securities by delivering to the office of the Registrar at Shops

1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, the

Conversion Notice during normal business hours (from 9:00 a.m. to 4:30 p.m.) stating his/her/its

intention to convert together with the original certificate of the Mandatory Convertible Securities and

proof reasonably satisfactory to the Company of the authority of the person or person(s) to execute

the Conversion Notice. The form of the Conversion Notice will be placed on the reverse side of the

certificate of the Mandatory Convertible Securities. The Conversion Notice shall be irrevocable and

shall oblige the Converting Securities Holder to accept the Conversion Shares arising on such

conversion on and subject to the Articles of the Company. The Company shall be responsible for

payment of all taxes and stamp, issue and registration fees and duties (if any), and Stock Exchange

levies and charges (if any) arising on any such conversion. Any calculation by the Company of the

number of Conversion Shares falling to be issued on a conversion shall, in the absence of manifest

error, be conclusive and binding on the Converting Securities Holder.

As soon as practicable and in any event not later than 15 Business Days after the Conversion

Date, the Company shall register the Converting Securities Holder (or such other person(s) as it may

direct in the Conversion Notice) as holder(s) of the relevant number of Ordinary Shares in the

Company’s register of members. The certificate for the new Ordinary Shares will be made available

for personal collection by the holder entitled thereto during normal business hours (Monday to Friday:

9:00 a.m. to 4:30 p.m.) at the office of the Registrar, Shops 1712-1716, 17th Floor, Hopewell Centre,

183 Queen’s Road East, Wanchai, Hong Kong, from the 15th Business Day after such Convertible

Securities Holder surrenders the certificate of the Mandatory Convertible Securities and delivers the

duly executed Conversion Notice.

Any Holder wishing to convert only part of his holding of Mandatory Convertible Securities

evidenced by a certificate must first split the certificate by lodging it with the Registrar. A fee will

be charged by the Registrar for the splitting of Mandatory Convertible Securities certificates,

currently being HK$2.50 per certificate using the 10 Business Days’ service. The new Mandatory

Convertible Securities certificates will be made available for personal collection by such holder


— 29 —


Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, from

the 10th Business Day onwards following receipt of the documents specified above by the Registrar

and upon production of such identification papers as may be reasonably requested by the Company or

the Registrar.

If the number of Ordinary Shares falling to be allotted and issued upon the exercise of any

conversion rights shall exceed the number of unissued Ordinary Shares in respect of which approval

for listing has been granted by the Listing Committee, the issue, deposit and delivery of Ordinary

Shares shall, in respect only of such excess number of Ordinary Shares, be postponed to the Business

Day next following the day on which approval for listing of such Ordinary Shares has been granted.

Mandatory Conversion of the Mandatory Convertible Securities

Any Mandatory Convertible Securities not converted on the date which is 20 trading days prior

to the Mandatory Conversion Date based on the register of holders of Mandatory Convertible

Securities shall be mandatorily converted into new Ordinary Shares at the Conversion Price on the

Mandatory Conversion Date. As soon as practicable and in any event not later than 15 Business Days

after the Mandatory Conversion Date, the Company shall register such Holder as holder of the relevant

number of Ordinary Shares in the Company’s register of members and will send by post at the risk of

such Holder to its address as stands on the register of holders of Mandatory Convertible Securities a

certificate for the relevant Ordinary Shares in the name(s) of such Holder, and the original certificates

of the Mandatory Convertible Securities shall lapse. The Company shall be responsible for payment

of all taxes and stamp, issue and registration fees and duties (if any), and Stock Exchange levies and

charges (if any) arising on any such conversion.

REASONS FOR THE OPEN OFFER AND USE OF PROCEEDS

The estimated net proceeds of the Open Offer will be approximately HK$15,286 million. The

Company intends to use the net proceeds of the Open Offer for the following purposes:

(i) approximately 55% of the net proceeds (equivalent to approximately HK$8,407 million)

will be used for debt repayment, of which approximately HK$3,869 million will be used to

repay the Company’s US$500 million listed notes maturing in 2015 and approximately

HK$4,538 million will be used to partly repay its bank borrowings and loan from CMU;

(ii) approximately 40% of the net proceeds (equivalent to approximately HK$6,114 million)

will be used for the Group’s capital expenditures in 2014, including (i) the continued

construction of the overseas port projects; (ii) the ongoing maintenance and improvement

of the other existing port projects of the Group; and (iii) acquisition of property, plant and

equipment for existing ports and ports related business, including, inter alia, those in the

PRC and overseas. To the extent the Group has identified any new investment opportunities

in other new projects, the Group might also consider utilizing a portion of such proceeds


— 30 —

A1B11

to invest in such new projects and the Group will make an appropriate announcement in

accordance with the Listing Rules if and when such investment opportunities materialize.

As of the Latest Practicable Date, the Group does not have, and is not having any

negotiation on, any such target investment or project; and

(iii) approximately 5% of the net proceeds will be used for providing funding for general

working capital.

The Company has confirmed with its auditor that the Mandatory Convertible Securities qualify

as equity instruments in the financial statements of the Company. Whilst the Mandatory Convertible

Securities carry fixed coupons at pre-determined rates in each of the three years before the Mandatory

Conversion Date, the Company has sole discretion to defer or cancel any scheduled Distribution and

any cancelled Distributions are non-cumulative. Furthermore, the Mandatory Convertible Securities

will be mandatorily convertible into Ordinary Shares by a specified date based on the pre-determined

Conversion Price. Based on the above, the Mandatory Convertible Securities can be regarded as equity

instruments in the financial statements of the Company.

In light of the above, the Board believes that the Open Offer is in the interests of both the

Company and its Ordinary Shareholders as a whole as it provides the Company’s Qualifying

Shareholders with the opportunity to maintain their respective pro rata shareholding in the Company

and continue to participate in the long-term growth and development of the Group. Further, as the

Mandatory Convertible Securities will be qualified as equity instruments in the financial statements

of the Company and since part of the new proceeds of the Open Offer will be used for debt repayment,

this will result in a lower gearing ratio for the Company and hence lower borrowing costs in the future.

In addition, it is expected that the issuance of the Mandatory Convertible Securities will strengthen

the Group’s capital structure and credit rating.

The Board is also of the view that the structure of the Mandatory Convertible Securities allows

flexibility where the Holders can choose either to hold the Mandatory Convertible Securities which

will entitle them to semi-annual coupons, or convert to Ordinary Shares at any time during the

Conversion Period to take advantage of any increase in share price over the Subscription Price. In

addition, the Board believes that the Subscription Price, representing a premium of 18% to the average

closing price per Ordinary Share for the last 5 full trading days up to and including the Last Trading

Day, reflects the long term value of the Company. The undertaking and underwriting commitments by

CMG, the ultimate controlling shareholder of the Company, and CMU, an associate of CMG,

demonstrate that the ultimate controlling shareholder of the Company shares the same view with

respect to the value of the Company and is supportive of the Company’s fund raising exercise. The

terms of the Open Offer apply to all Shareholders and should be fair to all Shareholders.

Furthermore, the Board chose to conduct the fund raising through offering Mandatory

Convertible Securities since it was the understanding of the Company that rights issue of unlisted

convertible instruments is rather uncommon and therefore may result in practical difficulties in terms

of settlement and trading of the nil paid rights of such unlisted convertible instruments. It is also

uncommon for rights offering or share placement to be conducted at a premium to the current share


— 31 —

price. Unlike rights offering and share placement which typically exerts downward pressure on share

price, the Board believes that the offer of Mandatory Convertible Securities at a premium to the

closing price of the Ordinary Shares on the Last Trading Day sends a positive message to the market

and could provide upward support for the share price of the Company.

FUND RAISING EXERCISES IN THE PRIOR 12-MONTH PERIOD

The Company has not conducted any fund raising activities in the past 12 months immediately

preceding the date of Announcement of the Open Offer.

ADDITIONAL INFORMATION

Your intention is drawn to the additional information contained in the appendices to this

Prospectus.

Yours faithfully

By Order of the Board

China Merchants Holdings (International) Company LimitedLi Jianhong

Chairman


— 32 —

1 FINANCIAL STATEMENTS OF THE GROUP

The audited consolidated financial statements of the Group for each of the three years ended 31

December 2011, 2012 and 2013 are included in the annual reports of the Company for the years ended

31 December 2011 (pages 59 to 165), 2012 (pages 61 to 162), and 2013 (pages 75 to 188) respectively,

which are published on both the website of the Stock Exchange (www.hkexnews.hk) and the website

of the Company (http://www.cmhi.com.hk). The auditor of the Company have issued unqualified

opinions on the audited consolidated financial statements of the Group for each of the three years

ended 31 December 2011, 2012, and 2013.

2 MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change

in the financial or trading position of the Group since 31 December 2013 (being the date to which the

latest published audited financial statements of the Company were made up).

3 STATEMENT OF INDEBTEDNESS

At the close of business on 31 March 2014, being the latest practicable date for this indebtedness

statement prior to the printing of this Prospectus, the Group had borrowings of approximately

HK$29,417 million, which comprised secured bank loans of approximately HK$3,453 million,

unsecured bank loans of approximately HK$4,366 million, unsecured guaranteed listed notes with

carrying amount of approximately HK$9,238 million (principal amount of approximately HK$9,308

million), unsecured non-guaranteed unlisted notes of approximately HK$1,884 million (principal

amount of approximately HK$1,891 million), unsecured loans from shareholders of the company of

approximately HK$10,182 million, and unsecured loans from a non-controlling equity holder of a

subsidiary of approximately HK$294 million.

The secured bank loans were secured by certain property, plant and equipment, land use right and

the entire shareholdings in two subsidiaries owned by the Group and the guaranteed listed notes were

secured by corporate guarantees given by the Company.

At the close of business on 31 March 2014, the other shareholder of an associate of which the

Group held as to 49% of its issued share capital provided corporate guarantees to the full amount for

certain loan facilities granted by banks to and other obligations borne by the relevant associate. A

counter indemnity in favour of the other shareholder of the associate, in the aggregate amount of

HK$241 million, is executed pursuant to which the Group undertakes to indemnify the other

shareholder 49% of the liabilities arising from the above loan facilities and other obligations. The

directors assessed the risk of default of the relevant associate as at 31 March 2014 and consider the

risk to be insignificant and it is not likely that any guaranteed amount will be claimed by the other

shareholder.

APPENDIX I FINANCIAL INFORMATION OF THE GROUP

— 33 —

A1B31(3)(a)

A1B32

A1B28(1)(2)(3)(4)

Save as aforesaid or as otherwise disclosed herein, and apart from the intra-group liabilities and

normal trade debts payable, the Group did not have outstanding at the close of business on 31 March

2014 any loan capital issued and outstanding or agreed to be issued, bank overdrafts, loans or other

similar indebtedness, liabilities under acceptances or acceptance credits, debentures, mortgages,

charges, hire purchases commitments, guarantees or other material contingent liabilities.

4 WORKING CAPITAL

Taking into account the financial resources available to the Group, including internally generated

funds, the available banking facilities, notes payable, loans from the shareholders of the Company and

a non-controlling equity holder of a subsidiary, other financial resources available to the Group and

the proceeds from the proposed Open Offer, and in the absence of unforeseen circumstances, the

Directors are of the opinion that the Group has sufficient working capital for its present requirements

for at least 12 months following the date of this Prospectus.

5 BUSINESS TREND AND PROSPECTS

The Company is the leading port investor and operator in China with international presence. At

present, the Company’s investments and operations span across China Coastal, including Hong Kong,

Shenzhen, Shanghai, Ningbo, Qingdao, Tianjin, Zhanjiang, Xiamen Bay, and Taiwan, Sri Lanka,

Nigeria, Djibouti, Togo and Vietnam.

The IMF, in its World Economic Outlook report published in January 2014 pointed out that, since

the second half of 2013, global economic activities and world trade have gradually been on an upward

trend with developed economies’ demand expanding as anticipated, whilst export rebound would be

the main driver behind improved activity of emerging economies. The report also projected the global

economy to grow 3.7% in 2014, of which growth of developed economies at 2.2%, up 0.9 percentage

point from that of 2013, and growth of emerging economies at 5.1%, or 0.4 percentage point up from

that of 2013. In addition, the report expected world trade volume (goods and service) to expand by

4.5%, reflecting a 1.8 percentage points increase from that of 2013.

Notwithstanding the macro-economic environment having somewhat improved, the international

maritime shipping companies’ operating environment is expected to remain difficult in the foreseeable

future, caused by excessive supply of shipping capacity, intensified competition within the industry,

and pressure on tariffs. The Group remains cautious to cautiously optimistic on its ports operation in

2014. The Group expects the global ports business performance for 2014 to be slightly better than that

for 2013, derived from a gradual increase in global economic and trade velocity growth. However, the

further allying of shipping companies would present the global port industry with both opportunities

and threats. The uneven deployment of port resources within individual regions along coastal China

would impact the operational behaviour of the ports at these regions. Besides, the trend towards

deploying more mega-sized vessels would necessitate the upgrading and restructuring of port

infrastructure and facilities.

To better position the operations of the Group amid the further allying of shipping companies,

the Group aims to forge deeper working relationships already existing with its strategic customers by

providing them, where possible, with comprehensive, multi-route and multi-stop, solutions by fully

leveraging on its expanding global port network, integrating ports resources and commercial

collaboration offered by such network.


— 34 —

A1B30

A1B29

As for improvements at its homebase capabilities, the Group will strive to accelerate the

construction and upgrading of the infrastructure and operating environment at West Shenzhen,

including berth upgrading and channel widening, in anticipation of the service demand from the

mega-vessels that are increasingly deployed. With the Group’s equity control in the equity interests

in its homebase ports in West Shenzhen having been consolidated in 2013, the Group plans to continue

its effort in the unifying and integrating these West Shenzhen ports through sharing of resources

within the region to enhance asset utilization and service quality. Meanwhile, the Group will continue

to streamline the cargo collection-distribution capabilities at ports, to improve the sea-rail inter-modal

connectivity in conjunction with expanding the barge network in the Pearl River Delta, and to further

explore new operation mode. All these endeavours aim to offer optimal value to its customers, thereby

increasing the attractiveness of the homebase port to shipping liners and the related cargo sources.

To further enhance its network portfolio, the Group will continue to explore the possibilities of

deepening the cooperation with its existing projects both in China and overseas while monitoring other

potential investment opportunities with a view to enhancing its global ports network through investing

prudently, building a balanced port portfolio, and creating mutually-beneficial synergies.


— 35 —

The unaudited pro forma financial information should be read in conjunction with Appendix I

headed “Financial Information of the Group” in this Prospectus, and the annual report of the Company

for the year ended 31 December 2013.

UNAUDITED PRO FORMA ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS

The unaudited pro forma statement of adjusted consolidated net tangible assets of the Group

attributable to the equity holders of the Company (the “Unaudited Pro Forma Financial

Information”) prepared in accordance with Rule 4.29 of the Listing Rules is set out below to illustrate

the effect of the Open Offer on the consolidated net tangible assets of the Group as if the Open Offer

had taken place on 31 December 2013.

The Unaudited Pro Forma Financial Information of the Group has been prepared for illustrative

purposes only, and because of its hypothetical nature, it may not give a true picture of the financial

position of the Group had the Open Offer been completed as at 31 December 2013 or at any future

date.

The Unaudited Pro Forma Financial Information of the Group is prepared based on the published

audited consolidated statement of financial position of the Group as at 31 December 2013, as extracted

from the annual report of the Group for the year ended 31 December 2013, with adjustments described

below:

Audited

consolidated

net assets of

the Group

attributable to

the equity

holders of the

Company as at

31 December

2013

Adjustments

for goodwill,

intangible

assets and

related

deferred tax

liabilities

Unaudited

consolidated

net tangible

assets of the

Group

attributable to

the equity

holders of the

Company as at

31 December

2013

Estimated net

proceeds from

the Open Offer

Unaudited pro

forma adjusted

consolidated

net tangible

assets of the

Group

attributable to

the owners of

the Company

immediately

after the

completion of

the Open Offer

as at 31

December 2013

HK$’million HK$’million HK$’million HK$’million HK$’million

(Note 1) (Note 2) (Note 4) (Note 5)

Based on 505,400,882 units of


Securities to be issued 48,599 (6,201) 42,398 15,286 57,684

APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATIONOF THE GROUP

— 36 —

Audited

consolidated

net assets of

the Group

attributable to

the equity

holders of the

Company as at

31 December

2013

Adjustments

for goodwill,

intangible

assets and

related

deferred tax

liabilities

Unaudited

consolidated

net tangible

assets of the

Group

attributable to

the equity

holders of the

Company as at

31 December

2013

Estimated net

proceeds from

the Open Offer

Unaudited pro

forma adjusted

consolidated

net tangible

assets of the

Group

attributable to

the owners of

the Company

immediately

after the

completion of

the Open Offer

as at 31

December 2013

HK$’million HK$’million HK$’million HK$’million HK$’million

(Note 1) (Note 2) (Note 4) (Note 5)

HK$

Unaudited consolidated net tangible

assets of the Group attributable to

the ordinary shareholders of the

Company per Ordinary Share as

at 31 December 2013 (Note 3) 16.78

Unaudited pro forma adjusted

consolidated net tangible assets of

the Group as at 31 December

2013 attributable to the ordinary

shareholders of the Company per

Ordinary Share immediately after

the completion of the Open Offer

(assuming none of the Mandatory

Convertible Securities was

converted into Ordinary Shares)

(Note 6) 16.78

1. The audited consolidated net assets of the Group attributable to the equity holders of the Company as at 31 December

2013 is extracted from the published audited annual report of the Group for the year ended 31 December 2013.

2. These represent the Group’s goodwill of HK$3,318 million and intangible assets of HK$5,274 million as at 31 December

2013, net of related deferred tax liabilities arising from intangible assets of HK$398 million and amounts of

non-controlling interests attributable to these account balances of HK$1,993 million as at 31 December 2013.

The amounts for goodwill and intangible assets are extracted from the published audited annual report of the Group for

the year ended 31 December 2013. The amounts for the related deferred tax liabilities and non-controlling interests are

extracted from schedules prepared by the Group of the same year.

3. The calculation of consolidated net tangible assets of the Group attributable to the ordinary shareholders of the Company

per share is based on the 2,526,690,412 Shares in issue as at 31 December 2013.


— 37 —

4. The estimated net proceeds from the Open Offer of HK$15,286 million are based on 505,400,882 units of Mandatory

Convertible Securities to be issued (based on 2,527,004,412 Shares in issue on the Record Date) at the Subscription Price

of HK$30.26 per unit of Mandatory Convertible Securities and after deduction of the estimated related professional

expenses, which are directly attributable to the Open Offer of HK$7 million. The Mandatory Convertible Securities are

classified as an equity instrument of the Company. Before conversion or mandatory conversion, the amount is attributable

to the holders of the Mandatory Convertible Securities.

5. The unaudited pro forma adjusted consolidated net tangible assets of the Group attributable to the owners of the Company

represents the unaudited consolidated net tangible assets of the Group attributable to the equity holders of the Company

as at 31 December 2013 plus the estimated net proceeds from the Open Offer as set out in Note 4 above.

6. The calculation of unaudited pro forma adjusted consolidated net tangible assets of the Group as at 31 December 2013

attributable to the equity holders of the Company per Ordinary Share immediately after the completion of the Open Offer,

assuming 505,400,882 units of Mandatory Convertible Securities are issued, is based on a pro forma adjusted

consolidated net tangible assets of the Group as at 31 December 2013 attributable to the owners of the Company

(including ordinary shareholders of the Company and holders of the Mandatory Convertible Securities) of HK$57,684

million, less carrying amount of HK$15,286 million described in note 4 that is attributable to the holders of Mandatory

Convertible Securities in arriving at the amount attributable to ordinary shareholders of the Company of HK$42,398

million, divided by the number of Ordinary Shares which comprise of 2,526,690,412 Ordinary Shares in issue as at 31

December 2013.

Had all of the 505,400,882 units of Mandatory Convertible Securities issued been converted into Ordinary Shares of the

Company on the Record Date, the unaudited pro forma adjusted consolidated net tangible assets of the Group as at 31

December 2013 attributable to the ordinary shareholders of the Company per Ordinary Share would have been HK$19.02,

based on a pro forma adjusted consolidated net tangible assets of the Group as at 31 December 2013 attributable to the

owners of the Company of HK$57,684 million divided by the pro forma adjusted number of Ordinary Shares of

3,032,091,294 Ordinary Shares.

7. No adjustment has been made to reflect any trading results or other transactions of the Group entered into subsequent

to 31 December 2013.


— 38 —

ACCOUNTANTS’ REPORT ON THE UNAUDITED PRO FORMA FINANCIALINFORMATION

The following is the text of an accountants’ report received from Deloitte Touche Tohmatsu,

Certified Public Accountants, Hong Kong, for inclusion in this Prospectus, in respect of the unaudited

pro forma financial information relating to the Group as set out in this Appendix II.

INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THECOMPILATION OF PRO FORMA FINANCIAL INFORMATION

TO THE DIRECTORS OF CHINA MERCHANTS HOLDINGS (INTERNATIONAL)COMPANY LIMITED

We have completed our assurance engagement to report on the compilation of pro forma financial

information of China Merchants Holdings (International) Company Limited (the “Company”) and its

subsidiaries (hereinafter collectively referred to as the “Group”) by the directors of the Company (the

“Directors”) for illustrative purposes only. The pro forma financial information consists of the pro

forma statement of adjusted consolidated net tangible assets of the Group attributable to the equity

holders of the Company as at 31 December 2013 and related notes as set out on pages 36 to 38 of

Appendix II to the prospectus issued by the Company dated 21 May 2014 (the “Prospectus”). The

applicable criteria on the basis of which the Directors have compiled the pro forma financial

information are described on pages 36 to 38 of Appendix II to the Prospectus.

The pro forma financial information has been compiled by the Directors to illustrate the impact

of the proposed open offer of unlisted mandatory convertible securities on the basis of one unit of

unlisted mandatory convertible securities for every five ordinary shares on the Group’s financial

position as at 31 December 2013 as if the proposed offer had taken place at 31 December 2013. As

part of this process, information about the Group’s consolidated net tangible assets attributable to the

equity holders of the Company has been extracted by the Directors from the Group’s consolidated

financial statements for the year ended 31 December 2013, on which an independent auditor’s report

has been published.

Directors’ Responsibility for the Pro Forma Financial Information

The Directors are responsible for compiling the pro forma financial information in accordance

with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong

Kong Limited (the “Listing Rules”) and with reference to Accounting Guideline 7 Preparation of Pro

Forma Financial Information for Inclusion in Investment Circulars (“AG 7”) issued by the Hong Kong

Institute of Certified Public Accountants (“HKICPA”).


— 39 —

A1B13A1B5(3)

Reporting Accountants’ Responsibilities

Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules,

on the pro forma financial information and to report our opinion to you. We do not accept any

responsibility for any reports previously given by us on any financial information used in the

compilation of the pro forma financial information beyond that owed to those to whom those reports

were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance

Engagements (“HKSAE”) 3420 Assurance Engagements to Report on the Compilation of Pro Forma

Financial Information Included in a Prospectus issued by the HKICPA. This standard requires that the

reporting accountant comply with ethical requirements and plan and perform procedures to obtain

reasonable assurance about whether the Directors have compiled the pro forma financial information

in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the

HKICPA.

For purposes of this engagement, we are not responsible for updating or reissuing any reports or

opinions on any historical financial information used in compiling the pro forma financial

information, nor have we, in the course of this engagement, performed an audit or review of the

financial information used in compiling the pro forma financial information.

The purpose of pro forma financial information included in the Prospectus is solely to illustrate

the impact of a significant event or transaction on unadjusted financial information of the Group as

if the event had occurred or the transaction had been undertaken at an earlier date selected for

purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of

the event or transaction at 31 December 2013 would have been as presented.

A reasonable assurance engagement to report on whether the pro forma financial information has

been properly compiled on the basis of the applicable criteria involves performing procedures to

assess whether the applicable criteria used by the Directors in the compilation of the pro forma

financial information provide a reasonable basis for presenting the significant effects directly

attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:

• The related pro forma adjustments give appropriate effect to those criteria; and

• The pro forma financial information reflects the proper application of those adjustments to

the unadjusted financial information.

The procedures selected depend on the reporting accountant’s judgment, having regard to the

reporting accountant’s understanding of the nature of the Group, the event or transaction in respect of

which the pro forma financial information has been compiled, and other relevant engagement

circumstances.

The engagement also involves evaluating the overall presentation of the pro forma financial

information.


— 40 —

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis

for our opinion.

Opinion

In our opinion:

a) the pro forma financial information has been properly compiled on the basis stated;

b) such basis is consistent with the accounting policies of the Group; and

c) the adjustments are appropriate for the purposes of the unaudited pro forma financial

information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

Deloitte Touche TohmatsuCertified Public Accountants

Hong Kong

21 May 2014


— 41 —

The Conversion Price shall from time to time be adjusted after the first date of issue of theMandatory Convertible Securities in accordance with the following provisions:

(a) Consolidation, subdivision or reclassification: If and whenever there shall be an alterationto number of Ordinary Shares in issue as a result of consolidation, subdivision orreclassification, the Conversion Price shall be adjusted by multiplying the Conversion Pricein force immediately before such alteration by the following fraction:

A

B

where:

A is the number of Ordinary Shares in issue immediately before such alteration; and

B is the number of Ordinary Shares in issue immediately after such alteration.

Such adjustment shall become effective on the date the alteration takes effect.

(b) Capitalisation of profits or reserves:

(i) If and whenever the Company shall issue any Ordinary Shares credited as fully paidto the Shareholders by way of capitalisation of profits or reserves including, OrdinaryShares paid up out of distributable profits or reserves (except any Scrip Dividend), theConversion Price shall be adjusted by multiplying the Conversion Price in forceimmediately before such issue by the following fraction:

A

B

where:

A is the number of Ordinary Shares in issue immediately before such issue; and

B is the number of Ordinary Shares in issue immediately after such issue.

(ii) In the case of an issue of Ordinary Shares by way of a Scrip Dividend where theCurrent Market Price on the date of announcement of the terms of such issue of suchOrdinary Shares exceeds the issue price for the Ordinary Shares under such ScripDividend, the Conversion Price shall be adjusted by multiplying the Conversion Pricein force immediately before the issue of such Ordinary Shares by the followingfraction:

A+B

A+C

APPENDIX III ADJUSTMENTS TO THE CONVERSION PRICE

— 42 —

where:

A is the number of issued Ordinary Shares immediately before such issue;

B is the number of Ordinary Shares issued by way of such Scrip Dividend

multiplied by a fraction of which (i) the numerator is the issue price for the

Ordinary Shares under such Scrip Dividend and (ii) the denominator is such

Current Market Price of the Ordinary Shares issued by way of Scrip Dividend;

and

C is the number of Ordinary Shares issued by way of such Scrip Dividend;

or by making such other adjustment as an Independent Investment Bank shall

certify to the Company is fair and reasonable.

Such adjustment shall become effective on the date of issue of such Ordinary Shares

or if a record date is fixed therefor, immediately after such record date.

(c) Share Repurchase: If and whenever the Company conducts any Share Repurchase, the

Conversion Price shall be adjusted by multiplying the Conversion Price in force

immediately before such Share Repurchase by the following fraction:

A-B

A

where:

A is the Current Market Price of one Ordinary Share on the last Trading Day preceding

the date of the Share Repurchase; and

B is the Fair Market Value on the date of such announcement of the portion of the Share

Repurchase attributable to one Ordinary Share.

Such adjustment shall become effective on the date that such Share Repurchase is actually

made or if a record date is fixed therefor, immediately after such record date.


— 43 —

(d) Rights Issues of Ordinary Shares or Options over Ordinary Shares: If and whenever theCompany shall issue Ordinary Shares to all or substantially all Shareholders as a class byway of rights, or issue or grant to all or substantially all Shareholders as a class by way ofrights, options, warrants or other rights to subscribe for or purchase or otherwise acquireany Ordinary Shares, in each case at less than 95 per cent. of the Current Market Price perOrdinary Share on the last Trading Day preceding the date of the announcement of the termsof the issue or grant, the Conversion Price shall be adjusted by multiplying the ConversionPrice in force immediately before such issue or grant by the following fraction:

A+B

A+C

where:

A is the number of Ordinary Shares in issue immediately before such announcement;

B is the number of Ordinary Shares which the aggregate amount (if any) payable for theOrdinary Shares issued by way of rights or for the options or warrants or other rightsissued or granted by way of rights and for the total number of Ordinary Sharescomprised therein would subscribe, purchase or otherwise acquire at such CurrentMarket Price per Ordinary Share; and

C is the aggregate number of Ordinary Shares issued or, as the case may be, comprisedin the rights, options, warrants or other rights granted.

Such adjustment shall become effective on the date of issue of such Ordinary Shares orissue or grant of such options, warrants or other rights (as the case may be) or where arecord date is set, the first date on which the Ordinary Shares are traded ex-rights,ex-options or ex-warrants as the case may be.

(e) Rights Issues of Other Securities: If and whenever the Company shall issue any securities(other than Ordinary Shares or options, warrants or other rights to subscribe, purchase orotherwise acquire any Ordinary Shares) to all or substantially all Shareholders as a class byway of rights or issue or grant to all or substantially all Shareholders as a class by way ofrights, options, warrants or other rights to subscribe for, purchase or otherwise acquire anysecurities (other than Ordinary Shares or options, warrants or other rights to subscribe for,purchase or otherwise acquire Ordinary Shares), the Conversion Price shall be adjusted bymultiplying the Conversion Price in force immediately before such issue or grant by thefollowing fraction:

A-B

A

where:

A is the Current Market Price of one Ordinary Share on the last Trading Day precedingthe date on which such issue or grant is publicly announced; and


— 44 —

B is the Fair Market Value on the date of such announcement of the portion of the rights

attributable to one Ordinary Share.

Such adjustment shall become effective on the date of issue of the securities or the issue

or grant of such rights, options or warrants (as the case may be) or where a record date is

set, the first date on which the Ordinary Shares are traded ex-rights, ex-options or

ex-warrants as the case may be on the Stock Exchange.

(f) Issues at less than Current Market Price: If and whenever the Company shall issue

(otherwise than as mentioned in paragraph (d) above) any Ordinary Shares (other than

Ordinary Shares issued on the conversion of the Mandatory Convertible Securities or on the

exercise of any other rights of conversion into, or exchange or subscription for Ordinary

Shares) or issue or grant (otherwise than as mentioned in paragraph (d) above) any options,

warrants or other rights to subscribe for, purchase or otherwise acquire any Ordinary

Shares, in each case at a price per Ordinary Share which is less than 95 per cent. of the

Current Market Price on the last Trading Day preceding the date of announcement of the

terms of such issue, the Conversion Price shall be adjusted by multiplying the Conversion

Price in force immediately before such issue by the following fraction:

A+B

A+C

where:

A is the number of Ordinary Shares in issue immediately before the issue of such

additional Ordinary Shares or the grant of such options, warrants or other rights to

subscribe, purchase or otherwise acquire any Ordinary Shares;

B is the number of Ordinary Shares which the aggregate consideration (if any)

receivable for the issue of such additional Ordinary Shares or would purchase at such

Current Market Price; and

C is the number of Ordinary Shares to be issued pursuant to such issue of Ordinary

Shares or, as the case may be, the maximum number of Ordinary Shares which may

be issued upon exercise of such options, warrants or rights calculated as at the date

of issue or grant of such options, warrants or rights.

References to additional Ordinary Shares in the above formula shall, in the case of an issue

by the Company of options, warrants or other rights to subscribe or purchase Ordinary

Shares, mean such Ordinary Shares to be issued assuming that such options, warrants or

other rights are exercised in full at the initial exercise price on the date of issue of such

options, warrants or other rights.

Such adjustment shall become effective on the date of issue of such additional Ordinary

Shares or, as the case may be, the grant of such options, warrants or other rights.


— 45 —

(g) Other Issues at less than Current Market Price: Save in the case of an issue of securities

arising from a conversion or exchange of other securities in accordance with the terms

applicable to such securities themselves falling within this paragraph (g), if and whenever

the Company or any of its Subsidiaries (otherwise than as mentioned in paragraph (d), (e)

or (f)), or (at the direction or request of or pursuant to any arrangements with the Company

or any of its Subsidiaries), any other company, person or entity shall issue any securities

(other than the Mandatory Convertible Securities excluding for this purpose any further

Mandatory Convertible Securities) which by their terms of issue carry rights of conversion

into, or exchange or subscription for, Ordinary Shares at a consideration per Ordinary Share

which is less than 95 per cent. of the Current Market Price on the last Trading Day

preceding the date of announcement of the terms of issue of such securities, the Conversion

Price shall be adjusted by multiplying the Conversion Price in force immediately before

such issue by the following fraction:

A+B

A+C

where:

A is the number of Ordinary Shares in issue immediately before such issue;

B is the number of Ordinary Shares which the aggregate consideration receivable by the

Company for the Ordinary Shares to be issued on conversion or exchange or on

exercise of the right of subscription attached to such securities would purchase at such

Current Market Price; and

C is the maximum number of Ordinary Shares to be issued on conversion or exchange

of such securities or on the exercise of such rights of subscription attached thereto at

the initial conversion, exchange or subscription price or rate.

Such adjustment shall become effective on the date of issue of such securities.

(h) Modification of Rights of Conversion etc.: If and whenever there shall be any modification

of the rights of conversion, exchange or subscription attaching to any such securities as are

mentioned in paragraph (g) (other than in accordance with the terms of such securities) so

that the consideration per Ordinary Share (for the number of Ordinary Shares available on

conversion, exchange or subscription following the modification) is less than 95 per cent.

of the Current Market Price on the last Trading Day preceding the date of announcement

of the proposals for such modification, the Conversion Price shall be adjusted by

multiplying the Conversion Price in force immediately before such modification by the

following fraction:

A+B

A+C


— 46 —

where:

A is the number of Ordinary Shares in issue immediately before such modification;

B is the number of Ordinary Shares which the aggregate consideration receivable by the

Company for the Ordinary Shares to be issued on conversion or exchange or on

exercise of the right of subscription attached to the securities so modified would

purchase at such Current Market Price or, if lower, the existing conversion, exchange

or subscription price of such securities; and

C is the maximum number of Ordinary Shares to be issued on conversion or exchange

of such securities or on the exercise of the right of subscription attached thereto at the

modified conversion, exchange or subscription or purchase price or rate but giving

credit in such manner as an Independent Investment Bank, considers appropriate (if at

all) for any previous adjustment under this paragraph (h) or paragraph (g) above.

Such adjustment shall become effective on the date of modification of the rights of

conversion, exchange or subscription attaching to such securities.

(i) Other Offers to Shareholders: If and whenever the Company or any of its Subsidiaries or

(at the direction or request of or pursuant to any arrangements with the Company or any of

its Subsidiaries) any other company, person or entity issues, sells or distributes any

securities in connection with which an offer pursuant to which the Shareholders generally

are entitled to participate in arrangements whereby such securities may be acquired by them

(except where the Conversion Price falls to be adjusted under paragraph (d), (e), (f) or (g)),

the Conversion Price shall be adjusted by multiplying the Conversion Price in force

immediately before such issue by the following fraction:

A-B

A

where:

A is the Current Market Price of one Ordinary Share on the last Trading Day preceding

the date on which such issue is publicly announced; and

B is the Fair Market Value on the date of such announcement of the portion of the rights

attributable to one Ordinary Share.

Such adjustment shall become effective on the date of issue, sale or delivery of the

securities.


— 47 —

(j) For the purpose of the adjustments of Conversion Price set out in paragraphs (a) to (i)

above:

“Closing Price” for the Ordinary Shares for any Trading Day shall be the price published

in the Daily Quotation Sheet published by the Stock Exchange for such day.

“Current Market Price” means, in respect of an Ordinary Share at a particular date, the

arithmetic average of the Closing Price for one Ordinary Share (being an Ordinary Share

carrying a full entitlement to dividends) for the five consecutive Trading Days ending on

such date; provided that if at any time during the said five Trading Day period the Ordinary

Shares shall have been quoted ex-dividend and during some other part of that period the

Ordinary Shares shall have been quoted cum-dividend then:

(i) if the Ordinary Shares to be issued in such circumstances do not rank for the dividend

in question, the quotations on the dates on which the Ordinary Shares shall have been

quoted cum-dividend shall for the purpose of this definition be deemed to be the

amount thereof reduced by an amount equal to the amount of that dividend per

Ordinary Share; or

(ii) if the Ordinary Shares to be issued in such circumstances rank for the dividend in

question, the quotations on the dates on which the Ordinary Shares shall have been

quoted ex-dividend shall for the purpose of this definition be deemed to be the amount

thereof increased by the such similar amount;

and provided further that if the Ordinary Shares on each of the said five Trading Days have

been quoted cum-dividend in respect of a dividend which has been declared or announced

but the Ordinary Shares to be issued do not rank for that dividend, the quotations on each

of such dates shall for the purpose of this definition be deemed to be the amount thereof

reduced by an amount equal to the amount of that dividend per Ordinary Share.

“Fair Market Value” means, with respect to any asset, security, option, warrant or other

right on any date, the fair market value of that asset, security, option, warrant or other right

as determined by an Independent Investment Bank provided that (i) the fair market value

of a cash dividend paid or to be paid per Ordinary Share shall be the amount of such cash

dividend per Ordinary Share determined as at the date of announcement of such dividend;

(ii) where options, warrants or other rights are publicly traded in a market of adequate

liquidity (as determined by such Independent Investment Bank) the fair market value of

such options, warrants or other rights shall equal the arithmetic mean of the daily closing

prices of such options, warrants or other rights during the period of five trading days on the

relevant market commencing on the first such trading day such options, warrants or other

rights are publicly traded.

“Independent Investment Bank” means an independent investment bank of international

repute (acting as an expert) selected by the Company.

“Relevant Cash Dividend” means any cash dividend specifically declared by the Company.


— 48 —

“Scrip Dividend” means any Ordinary Shares issued in lieu of the whole or any part of any

Relevant Cash Dividend being a dividend which the Shareholders concerned would or could

otherwise have received.

“Share Repurchase” means a purchase or redemption of Ordinary Shares by or on behalf

of the Company (or a purchase of Ordinary Shares by or on behalf of a Subsidiary of the

Company), where the weighted average price (before expenses) on any one day in respect

of such purchases exceeds 110 per cent. of the Current Market Price of the Ordinary Shares

as published in the Daily Quotation Sheet of the Stock Exchange, either (1) on that date,

or (2) where an announcement has been made of the intention to purchase Ordinary Shares

at some future date at a specified price, on the Trading Day immediately preceding the date

of such announcement and, if in the case of either (1) or (2), the relevant day is not a

Trading Day, the immediately preceding Trading Day.

“Subsidiary” or “subsidiary” has the meaning ascribed to this term in the Companies

Ordinance (Chapter 622 of the Laws of Hong Kong).

“Trading Day” means a day when the Stock Exchange is open for dealing business,

provided that if no Closing Price is reported for one or more consecutive dealing days such

day or days will be disregarded in any relevant calculation and shall be deemed not to have

been dealing days when ascertaining any period of dealing days.

(k) On any adjustment, the relevant Conversion Price, if not an integral multiple of one Hong

Kong cent, shall be rounded down to the nearest Hong Kong cent. No adjustment shall be

made to the Conversion Price where such adjustment (rounded down if applicable) would

be less than one per cent. of the Conversion Price then in effect. Any adjustment not

required to be made, and any amount by which the Conversion Price has not been rounded

down, shall be carried forward and taken into account in any subsequent adjustment. Notice

of any adjustment shall be given to Holders as soon as practicable after the determination

thereof.

(l) Where more than one event which gives or may give rise to an adjustment to the Conversion

Price occurs within such a short period of time that in the opinion of an Independent

Investment Bank, the foregoing provisions would need to be operated subject to some

modification in order to give the intended result, such modification shall be made to the

operation of the foregoing provisions as may be advised by such Independent Investment

Bank to be in its opinion appropriate in order to give such intended result.

(m) No adjustment will be made to the Conversion Price when Ordinary Shares or other

securities (including rights or options) are issued, offered or granted to employees

(including directors) of the Company or any Subsidiary of the Company pursuant to any

employee share option scheme of the Company (and which is in compliance with the Listing

Rules).


— 49 —

(n) No adjustment involving an increase in the Conversion Price will be made, except in the

case of a consolidation of the Ordinary Shares as referred to in paragraph (a) above or

where there has been a manifest error in the calculation of the Conversion Price.

The Registrar shall not be under any duty to monitor whether any event or circumstance has

happened or exists which may require an adjustment to be made to the Conversion Price or any

calculation (or verification thereof) in connection with the Conversion Price and will not be

responsible to Holders for any loss arising from any failure by them to do so.


— 50 —

RESPONSIBILITY STATEMENT

This Prospectus, for which the Directors collectively and individually accept full responsibility,

includes particulars given in compliance with the Listing Rules for the purpose of giving information

with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the

best of their knowledge and belief the information contained in this Prospectus is accurate and

complete in all material respects and not misleading or deceptive, and there are no other matters the

omission of which would make any statement herein or this Prospectus misleading.

DIRECTORS’ AND CHIEF EXECUTIVE’S INTERESTS AND SHORT POSITIONS IN

SHARES, UNDERLYING SHARES OR DEBENTURES

As at the Latest Practicable Date, the Directors and the chief executive of the Company have the

following interests and short positions in shares, underlying shares or debentures of the Company or

any associated corporation (within the meaning of Part XV of the SFO) which (i) are required to be

notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO

(including interests and short positions in which the Directors and the chief executive of the Company

are deemed or taken to have under such provisions of the SFO); or (ii) are required, pursuant to

Section 352 of the SFO, to be entered in the registrar referred to therein; or (iii) are required, pursuant

to the Model Code for Securities Transactions by Directors of Listed Companies, to be notified to the

Company of the Stock Exchange:

(i) Directors’ interests in Ordinary Shares

Name of Director CapacityNumber of

Ordinary SharesPercentage of issued

Ordinary Shares

Mr. Yu Liming Beneficial owner 397,645(L) 0.016%

Mr. Wang Hong Beneficial owner 529,277(L) 0.021%

Mr. Lee Yip Wah Peter Beneficial owner 164,902(L) 0.006%

Mr. Lee Kwok Heem John Interest of spouse 1,617,296(L) 0.064%

Total 2,709,120(L) 0.107%

Note: (L) refer to long position

APPENDIX IV GENERAL INFORMATION

— 51 —

A1B2

A1B38(1)A1B38(1A)

A1B25

(ii) Directors’ interests in Share Options

Name of Directors Date of grant

Exerciseprice

(HK$)

Total ShareOptions granted(and percentage

of issued Shares)

Outstanding ShareOptions not exercised

as at the LatestPracticable Date

(and percentage ofissued Shares)

Mr. Li Yinquan 25 May 2006 23.03 400,000 0.016% 400,000 0.016%

Mr. Hu Zheng 27 October 2004 11.08 500,000 0.020% 14,000 0.001%

25 May 2006 23.03 400,000 0.016% 400,000 0.016%

Mr. Meng Xi 25 May 2006 23.03 400,000 0.016% 200,000 0.008%

Mr. Su Xingang 25 May 2006 23.03 350,000 0.014% 350,000 0.014%

Mr. Yu Liming 25 May 2006 23.03 500,000 0.020% 500,000 0.020%

Mr. Wang Hong 25 May 2006 23.03 650,000 0.025% 150,000 0.005%

Mr. Zheng Shaoping 25 May 2006 23.03 300,000 0.012% 300,000 0.012%

3,500,000 0.139% 2,314,000 0.092%

The above outstanding Share Options not exercised as at the Latest Practicable Date may be

exercised at any time during a period of ten years commencing on the date of grant of the Share

Options.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or the chief

executive of the Company had any interest or short positions in shares, underlying shares or

debentures of the Company or any associated corporation (within the meaning of Part XV of the SFO)

which are required to be (i) notified to the Company and the Stock Exchange pursuant to Divisions

7 and 8 of Part XV of the SFO; or (ii) entered in the registrar kept by the Company pursuant to Section

352 of the SFO; or (iii) notified to the Company of the Stock Exchange pursuant to the Model Code

for Securities Transactions by Directors of Listed Companies.

(iii) Other positions of Directors in the Shareholders

The following Directors hold executive positions with the following Shareholders:

(1) Mr. Li Jianhong, Mr. Li Yinquan, Mr. Hu Zheng, Mr. Meng Xi, Mr. Su Xingang, Mr. Yu

Liming, Mr. Hu Jianhua and Mr. Wang Hong hold executive positions with CMG; and

(2) Mr. Li Jianhong, Mr. Li Yinquan, Mr. Hu Zheng, Mr. Meng Xi, Mr. Su Xingang and Mr. Yu

Liming also hold executive positions with CMHK.

Save as disclosed herein, none of the Directors is a director or employee of a company which has,

or is deemed to have, an interest or short position in the shares or underlying shares of the Company

which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part

XV of the SFO.


— 52 —

SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, so far as is known to the Directors or the chief executive, the

persons/entities (other than the Directors or the chief executive of the Company) who had an interest

or short positions in the shares and underlying shares of the Company which would fall to be disclosed

to the Company and the Stock Exchange under provisions of Divisions 2 and 3 of Part XV of the SFO

were as follows:

Name of Shareholders CapacityNumber of Ordinary

Shares interested

Approximatepercentage ofshareholding

CMG Interest of Controlled

Corporation

1,392,242,072(1, 2, 3) 55.09%

China Merchants Steam

Navigation Company

Limited

Interest of Controlled

Corporation

1,389,242,072(2) 54.98%

CMHK Interest of Controlled

Corporation

1,389,242,072(2) 54.98%

China Merchants Union

(BVI) Limited

Beneficial Owner 572,652,008(2, 4) 22.66%

China Merchants

Investment

Development Company

Limited

Beneficial Owner 596,165,519(2) 23.59%

Hoi Tung Marine

Machinery Suppliers

Limited


Corporation

202,800,480(2) 8.03%

Hoi Tung Investment

(Yantai) Limited

Beneficial Owner 202,800,480(2) 8.03%

Pagoda Tree Investment

Company Limited


Corporation

572,652,008(4) 22.66%

Compass Investment

Company Limited


Corporation

572,652,008(4) 22.66%

GUOXIN International

Investment Corporation

Limited


Corporation

572,652,008(4) 22.66%

Verise Holdings Company

Limited


Corporation

572,652,008(4) 22.66%

Notes:

(1) Each of China Merchants Steam Navigation Company Limited and China Merchants Shekou Industrial Zone Company

Limited is wholly-owned by CMG. CMG is deemed to be interested in 1,392,242,072 shares, which represents the

aggregate of 1,389,242,072 shares deemed to be interested by China Merchants Steam Navigation Company Limited (see

Note 2 below) and 3,000,000 shares deemed to be interested by China Merchants Shekou Industrial Zone Company

Limited (see Note 3 below).


— 53 —

A1B38(2)

(2) CMHK is wholly-owned by China Merchants Steam Navigation Company Limited. Each of China Merchants Investment

Development Company Limited, Hoi Tung Marine Machinery Suppliers Limited and China Merchants International

Finance Company Limited is in turn wholly-owned by CMHK and CMU is 50%-owned by CMHK.

China Merchants Steam Navigation Company Limited is deemed to be interested in 1,389,242,072 shares which are

deemed to be interested by CMHK. Such shares represent the aggregate of 572,652,008 shares beneficially held by CMU,

596,165,519 shares beneficially held by China Merchants Investment Development Company Limited, 202,800,480

shares deemed to be interested by Hoi Tung Marine Machinery Suppliers Limited and 17,624,065 shares deemed to be

interested by China Merchants International Finance Company Limited.

As Hoi Tung Investment (Yantai) Limited is wholly-owned by Hoi Tung Marine Machinery Suppliers Limited, Hoi Tung

Marine Machinery Suppliers Limited is deemed to be interested in the 202,800,480 shares beneficially held by Hoi Tung

Investment (Yantai) Limited. As Best Winner Investment Limited is wholly-owned by China Merchants International

Finance Company Limited, China Merchants International Finance Company Limited is deemed to be interested in the

17,624,065 shares beneficially held by Best Winner Investment Limited.

(3) Top Chief Company Limited is wholly-owned by China Merchants Shekou Industrial Zone Company Limited and

Orienture Holdings Company Limited is in turn wholly-owned by Top Chief Company Limited. China Merchants Shekou

Industrial Zone Company Limited is deemed to be interested in the 3,000,000 shares which are deemed to be interested

by Top Chief Company Limited. Such shares represent the 3,000,000 shares beneficially held by Orienture Holdings

Company Limited.

(4) The remaining 50% interest in CMU is owned by Verise Holdings Company Limited, which is wholly-owned by GUOXIN

International Investment Corporation Limited, which is in turn 90%-owned by Compass Investment Company Limited,

which is in turn wholly-owned by Pagoda Tree Investment Company Limited. Therefore, each of Verise Holdings

Company Limited, GUOXIN International Investment Corporation Limited, Compass Investment Company Limited and

Pagoda Tree Investment Company Limited is deemed to be interested in the 572,652,008 shares beneficially held by

CMU.

Save as disclosed herein, according to the register of interests kept by the Company under section

336 of the SFO and so far as was known to the Directors or the chief executive of the Company, there

is no other person or entity (other than a Director or the chief executive of the Company) who, as at

the Latest Practicable Date, had any interests or short positions in the shares or underlying shares of

the Company which would fall to be disclosed to the Company and the Stock Exchange under

Divisions 2 and 3 of Part XV of the SFO.

INFORMATION ON DIRECTORS AND SENIOR MANAGEMENT

The business address of all Directors and members of senior management is at 38th Floor, China

Merchants Tower, Shun Tak Centre, 168-200 Connaught Road Central, Hong Kong and their brief

biographies are set out below:

Executive Directors

Mr. Li Jianhong, aged 57, is the Chairman of the Company, a Director and the President of

China Merchants Group Limited. He is also a Director of China Merchants Holdings (Hong Kong)

Company Limited. He holds a professional title of “Senior Economist” and graduated from East

London University, England with Master Degree in Business Administration and also obtained Master

Degree in Economy and Management from Jilin University. Before joining the Company, he worked


— 54 —

A1B34

with China Ocean Shipping (Group) Company. He was Factory Manager of Nantong Shipyard, General

Manager of COSCO Industry Company, Assistant to the President, Chief Economist and Executive

Vice President of China Ocean Shipping (Group) Company, Chairman of COSCO Corporation

(Singapore) Limited, Sino-Ocean Land Holdings Ltd., COSCO Shipyard Group Co., Ltd. and Nantong

COSCO KHI Ship Engineering Co., Ltd. He was also a Director of China COSCO Holdings Co., Ltd.,

COSCO Pacific Limited and COSCO International Holdings Limited, shares of all of which are listed

on The Stock Exchange of Hong Kong Limited. Besides, he was also Vice Chairman and Chairman of

China International Marine Containers (Group) Limited, shares of which are listed on the Shenzhen

Stock Exchange. He was also an Executive Vice Chairman of the Chinese Society of Naval Architects

and Marine Engineers and Vice President of China Association of the National Shipbuilding Industry

and was awarded as an outstanding entrepreneur for the third year in 1993, a paragon of transportation

and labour section in 1994 and 1995 respectively in China. Mr. Li is the Chairman of China Merchants

Energy Shipping Company Limited, shares of which are listed on the Shanghai Stock Exchange and

China International Marine Containers (Group) Co., Ltd., shares of which are listed on the Shenzhen

Stock Exchange. He was appointed to the Board of Directors as Executive Director on 14 October

2010 and was appointed as the Chairman of the Company on 9 May 2014.

Mr. Li Yinquan, aged 59, is the Vice President of China Merchants Group Limited and the

Chairman of China Merchants Finance Holdings Company Limited. He is also a Director of China

Merchants Holdings (Hong Kong) Company Limited. He graduated from the Shaanxi Institute of

Finance and Economics with a Bachelor of Economics, and holds a Master in Economics from The

People’s Bank of China Graduate School in Beijing. He also holds a Master in Banking and Finance

from the Finafrica Institute in Milan, Italy. Prior to joining China Merchants Group Limited in 2000,

he worked in the Agricultural Bank of China from 1985 to 1999 where his last position was Deputy

General Manager of Hong Kong branch. He is currently an Executive Director and the Chairman of

China Merchants China Direct Investments Limited, shares of which are listed on The Stock Exchange

of Hong Kong Limited and a Non-executive Director of China Merchants Bank Co., Ltd, shares of

which are listed on both the Shanghai Stock Exchange and The Stock Exchange of Hong Kong

Limited. He is a Hong Kong Deputy to the 12th National People’s Congress of the People’s Republic

of China. He was appointed to the Board of Directors as Executive Director on 20 June 2001.

Mr. Hu Zheng, aged 58, is the Vice President of China Merchants Group Limited, concurrently

serving as Chairman of China Merchants Logistics Holding Co., Ltd., Officer of Management

Committee of Zhangzhou China Merchants Economic and Technological Development Zone,

Chairman of China Merchants Zhangzhou Development Zone Co., Ltd. and Chairman of Board of

Trustees of China Merchants Charitable Foundation. He is also a Director of China Merchants

Holdings (Hong Kong) Company Limited. Moreover, he is Vice Chairman of The Hong Kong Chinese

Enterprises Association, China Association of Purchasing and Logistics and China Association of

Communications Enterprises Management. He obtained a Master Degree in Business Administration

from Murdoch University, Australia and holds a professional title of “Senior Economist”. Mr. Hu

successively served as the Secretary of the General Office of the Ministry of Communications,

Secretary of the board of directors, General Manager of the Executive Department, Assistant President

and General Legal Counsel of China Merchants Group Limited, and No. 1 Deputy General Manager

of China Merchants Shekou Industrial Zone Company Limited. He was appointed to the Board of

Directors as Executive Director on 29 June 2004.


— 55 —

Mr. Meng Xi, aged 58, is the Vice President of China Merchants Group Limited. He is also a

Director of China Merchants Holdings (Hong Kong) Company Limited. He graduated from the Beijing

Construction Engineering College and was awarded “Senior Engineer” in the PRC. He joined China

Merchants Group Limited in 1983 and was formerly the Deputy General Manager of China Merchants

Shekou Industrial Zone Company Limited, Deputy General Manager of Enterprises and Projects

Division, General Manager of Management Information Division, General Manager of Strategic

Planning Department of China Merchants Group Limited. Mr. Meng has extensive experience in the

field of management of enterprises, strategic investment, management information system and

strategic planning. He was appointed to the Board of Directors as Executive Director on 20 June 2001.

Mr. Su Xingang, aged 55, is the Vice President of China Merchants Group Limited. He is also

a Director of China Merchants Holdings (Hong Kong) Company Limited. He graduated from Ship

Navigation and Harbour Superintendency Administration Specialty of Navigation Department of

Dalian Maritime University (formerly Dalian Marine College). He holds the professional title of

“Senior Engineer”. He is a Director of China Merchants Energy Shipping Company Limited, shares

of which are listed on the Shanghai Stock Exchange, Vice Chairman of China LNG Shipping

(Holdings) Limited, a Director and the Vice Chairman of Shanghai International Port (Group)

Company Limited, shares of which are listed on the Shanghai Stock Exchange, and a Director of

Ningbo Port Company Limited, shares of which are listed on the Shanghai Stock Exchange. Before

joining China Merchants Group Limited, he served as Deputy Division Chief of Department of

Transportation Administration, Assistant Director General of Department of Water Transportation of

Ministry of Communications, Vice President of China Changjiang National Shipping (Group) Corp.,

Deputy Director General, Director General of Department of Water Transportation of Ministry of

Communications. He was appointed to the Board of Directors as Executive Director on 25 May 2007.

Mr. Yu Liming, aged 51, is the Vice President of China Merchants Group Limited. He is also

a Director of China Merchants Holdings (Hong Kong) Company Limited. He graduated from the South

China University of Science and Technology in 1982. He holds a PhD Degree at the Business School

of Fudan University, the PRC. He studied in The International Institute of Infrastructural Hydraulic

and Environmental Engineering (IHE), Delft University of Holland and Port of Rotterdam from 1987

to 1988. He joined China Merchants Group Limited in 1984 and has extensive experience in the field

of strategic planning, mergers and acquisitions, port management and construction business. He was

appointed to the Board of Directors as Executive Director on 8 January 1999.

Mr. Hu Jianhua, aged 51, is the Assistant President of China Merchants Group Limited and the

Managing Director of the Company. He graduated from the Dalian University of Technology in the

PRC with a Bachelor Degree in Port and Waterway Engineering. He then obtained his Master Degree

in Construction Management at the University of Birmingham of the United Kingdom and his Doctor

Degree in Business Administration at the University of South Australia. He is the Professorial Senior

Engineer conferred by MOC of China, a fellow member of the Hong Kong Institution of Engineers

(FHKIE) and also a fellow member of Institution of Civil Engineering Surveyors of the United

Kingdom (FlnstCES) respectively. Prior to joining the Company, he was the Managing Director of

Hong Kong Zhen Hua Engineering Co., Ltd, Deputy Chief Economist cum General Manager of

Overseas Division of China Harbor Engineering Company Group and Managing Director of China

Harbor Engineering Company Limited. Having rich working experiences in overseas, he has extended

the business to over 30 countries and regions in the development, construction and operation of large


— 56 —

infrastructure projects such as ports, roads and bridges. With experiences as corporate executive, he

also holds the post of executive director in several companies in China and overseas. He was appointed

to the Board of Directors as Executive Director on 25 May 2007 and was appointed as the Managing

Director of the Company on 26 March 2010.

Mr. Wang Hong, aged 51, is the Chief Economist and the General Manager of Strategic Planning

Department of China Merchants Group Limited. He is also a Director of China International Marine

Containers (Group) Co., Ltd., shares of which are listed on Shenzhen Stock Exchange, a Director of

China Merchants Energy Shipping Company Limited, shares of which are listed on the Shanghai Stock

Exchange and a Director of China Merchants Property Development Company Limited, shares of

which are listed on the Shenzhen Stock Exchange. He graduated from Dalian Maritime University in

the PRC in Marine Engineering in 1982, as a holder of Master of Business Administration of Graduate

School of Beijing University of Science and Technology, and a holder of PhD of Management of

Graduate School of China Academy of Social Science. Mr. Wang successively served as Engineer in

COSCO Guangzhou, General Manager of Shipping Department, General Manager of Finance and

Accounting Department, and Vice President of China Communications Import & Export Corp.,

Managing Director of Hoi Tung Marine Machinery Suppliers Ltd., General Manager of Performance

Evaluation Department, Human Resources Department and Strategic and Research Department of

China Merchants Group Limited. He was the Deputy Managing Director and Chief Operational Officer

of the Company, the Vice Chairman of Shanghai International Port (Group) Co., Ltd., shares of which

are listed on the Shanghai Stock Exchange and the Chairman of China Merchants Holdings (Pacific)

Limited, shares of which are listed on Singapore Exchange Limited. Mr. Wang has extensive

experience in shipping industry, international trading, financing and accounting and human resource

management. He was appointed to the Board of Directors as Executive Director on 11 May 2005.

Mr. Zheng Shaoping, aged 51, is the Deputy General Manager of the Company. He graduated

from Dalian Maritime University with Postgraduate Diploma in International Maritime Law, and

obtained a Master Degree of Business Administration at University of Wales. Mr. Zheng has over 20

years’ experience in the field of port management and successively served as the General Manager of

Chiwan Container Terminal Co., Ltd., the General Manager and the Chairman of Shenzhen Chiwan

Harbour Container Co., Ltd. and the Managing Director and the Vice Chairman of Shenzhen Chiwan

Wharf Holdings Limited. He is also the Vice Chairman of China Merchants Bonded Logistics Co.,

Ltd., the Chairman of Shekou Container Terminals Ltd., the Chairman of Chiwan Container Terminal

Co., Ltd. and the Chairman of Shenzhen Chiwan Wharf Holdings Limited, shares of which are listed

on the Shenzhen Stock Exchange. He was appointed to the Board of Directors as Executive Director

on 10 February 2012.

Independent non-executive directors

Mr. Kut Ying Hay, aged 59, is a solicitor and a notary public in Hong Kong and had been in

practice in the name of Kut & Co. for more than 25 years. He is also a solicitor of the Supreme Court

of England and Wales, the Supreme Court of Victoria, Australia, and the Supreme Court of Singapore,

and is an associate member of the Institute of Chartered Arbitrators and the Institute of Arbitrators,

Australia. He was appointed by the Hong Kong Government as a member of the Board of Review for

the period from 1995 to 1998. He has also been appointed by the Ministry of Justice of the PRC as


— 57 —

a China Appointed Attesting Officer. Mr. Kut was formerly an Independent Non-executive Director of

publicly-listed China Merchants China Direct Investments Limited from June 1993 to October 2011.

He was appointed to the Board of Directors as Independent Non-executive Director on 6 June 1992.

Mr. Lee Yip Wah Peter, aged 72, is a retired solicitor. He is also a Non-executive Director of

SHK Hong Kong Industries Limited, an Independent Non-executive Director of Sinotrans Shipping

Limited. Both the said companies are listed on The Stock Exchange of Hong Kong Limited. He was

appointed to the Board of Directors as Independent Non-executive Director on 20 June 2001.

Mr. Li Kwok Heem John, aged 58, was a partner at PricewaterhouseCoopers, Certified Public

Accountants. He graduated from the Imperial College of the University of London with a Bachelor of

Science degree and also obtained a Master of Business Administration degree from the Wharton

School of Business of the University of Pennsylvania. He is a Fellow of The Institute of Chartered

Accountants in England and Wales. Mr. Li is the Chairman of the United Christian Medical Service

and the United Christian Hospital, a member of the Board of the Hospital Governing Committee of

Pamela Youde Nethersole Eastern Hospital and Alice Ho Mui Ling Nethersole Hospital, and a member

of the Board of Trustees of Chung Chi College, The Chinese University of Hong Kong. He was

appointed to the Board of Directors as Independent Non-executive Director on 8 October 2004.

Mr. Li Ka Fai David, aged 59, is currently the deputy managing partner of Li, Tang, Chen &

Co. CPA (Practising). He is also a fellow of the Hong Kong Institute of Certified Public Accountants

and The Association of Chartered Certified Accountants, UK as well as The Institute of Chartered

Secretaries and Administrators, UK and an associate member of The Institute of Chartered

Accountants in England and Wales. He is an Independent Non-executive Director and Chairman of

audit committee of China-Hongkong Photo Products Holdings Limited, an Independent Non-executive

Director, Chairman of audit committee, member of remuneration committee and member of

nomination committee of Cosmopolitan International Holdings Limited, an Independent

Non-executive Director, Chairman of audit committee, member of remuneration committee and

member of nomination committee of Goldlion Holdings Limited, an Independent Non-executive

Director and Chairman of audit committee of Shanghai Industrial Urban Development Group Limited,

and an Independent Non-executive Director, member of audit committee and member of remuneration

committee of AVIC International Holding (HK) Limited, shares of the above five companies are listed

on The Stock Exchange of Hong Kong Limited. He retired as an Independent Director and Chairman

of audit committee of China Vanke Co., Ltd. (2005-2011), a company listed on the Shenzhen Stock

Exchange, and retired as an advisor of that Company on 30 March 2013. He was appointed to the

Board of Directors as Independent Non-executive Director on 1 June 2007.

Mr. Bong Shu Ying Francis, aged 72, OBE, JP, is currently a Non-executive Director of

Cosmopolitan International Holdings Limited, a company listed on The Stock Exchange of Hong Kong

Limited. Mr. Bong holds a Bachelor’s degree of Sciences in Engineering from the University of Hong

Kong and is a Past President of Hong Kong Academy of Engineering Sciences and Chairman of the

Hong Kong University Engineering Advisory Committee. He is a Past President of the Hong Kong

Institution of Engineers, a Fellow of the Institution of Civil Engineers (UK) and a Fellow of the

Institution of Structural Engineers (UK). Mr. Bong is an Honorary Fellow of the University of Hong

Kong and he was appointed a Justice of Peace in 1992 by the Government of Hong Kong and he


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received an OBE award in 1997 for his outstanding contribution to the development of the engineering

profession in Hong Kong. Mr. Bong retired as a Director of AECOM Technology Corporation, a

company listed on the New York Stock Exchange, on 5 March 2014. He was appointed to the Board

of Directors as Independent Non-executive Director on 14 July 2010.

Senior management

Mr. Liu Yunshu, aged 49, joined the Company in 2004 and is Overseas Operation Officer of the

Company and Chief Executive Officer of Colombo International Container Terminals Limited. He

obtained his Master of Business Administration at Roosevelt University of America. Mr. Liu has vast

experience in ports and logistics industries. Before joining the Company, he was a Director and

Deputy General Manager of Shenzhen Shekou China Merchants Port Services Co., Ltd., Vice

Chairman and General Manager of Shenzhen Shekou Anda Industry Co. Ltd., a Director and Chief

Operating Officer of China Merchants Logistics Group Co., Ltd. He was an Executive Director of the

Company for the period from 3 June 2009 to 10 February 2012.

Ms. Wong Sin Yue Cynthia, aged 62, joined the Company in 2004 and is a Deputy General

Manager of the Company, responsible for finance. Prior to joining the Company, she took various

senior positions at reputable international investment banks including Société Générale, Deutsche

Morgan Grenfell, Samuel Montague and Bear Stearns Asia for over 15 years, during which period she

had advised more than 50 companies in Greater China and Asia in their equity, equity finance or

equity-related activities. She was, until February 2009, a Non-executive Director of China Merchants

Holdings (Pacific) Limited, the shares of which are listed on the Singapore Exchange Limited. She

holds a Master of Business Administration Degree from the University of East Asia in Macau. She is

also an Independent Non-executive Director of China Gas Holdings Limited, the shares of which are

listed on The Stock Exchange of Hong Kong Limited.

Mr. Zhang Rizhong, aged 45, joined the Company in 2005 and is the Deputy General Manager

and the Financial Controller of the Company, responsible for accounting, finance and internal control

and audit. He holds a Master of Business Administration Degree from The University of Westminster

of UK, and graduated with a Bachelor degree of Economics from The Central Finance and Economics

University in the PRC. He is a Member of Association of Chartered Certified Accountants. With over

22 years in Finance and Accounting area, he has extensive experience in finance management. Before

joining the Company, he was Deputy General Manager of Financial Department of China Merchants

Group Limited, Financial Controller of China Merchants Holdings (UK) Co. Ltd, and a director of

several companies.

Mr. Deng Weidong, aged 46, joined the Company in July 2009 and is the Deputy General

Manager of the Company. He graduated from Nanjing University with a PhD of Physical Geography

in 1994. He obtained a Master Degree of Marine Management from Dalhousie University, Canada in

2002. He has vast experience in port management and port operation. Prior to joining the Company,

he worked in Administration Bureau of Hainan Yangpu Economic Development Zone, and he was the

General Manager of Business Development Department of China Nanshan Development (Group) Inc.

and the Deputy General Manager of Chiwan Container Terminal Co., Ltd.


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Mr. Wang Zhixian, aged 49, joined the Company in July 1992 and is the Deputy GeneralManager of the Company. He graduated from Tianjin University, Shanghai Jiaotong University witha Master of Science. He obtained a master degree of Business Administration from Peking University.Mr. Wang has extensive management experience in port and shipping industry. Prior to joining theCompany, he worked in Hempel-Hai Hong Paint Company as sales manager. After joining theCompany, he was the Deputy General Manager of Industrial Management Department, GeneralManager of Business Planning Department, and he was the Deputy General Manager of ShenzhenMawan Port Services Co., Ltd, the Chairman and CEO of Ningbo Daxie China Merchants InternationalTerminal Co., Ltd and the Managing Director of China Merchants Port Services (Shenzhen) Co., Ltd.and Shenzhen Haixing Harbour Development Co., Ltd.

Mr. Yu Shixin, aged 51, joined the Company in 2007 and is the Deputy General Manager of theCompany. He graduated from Zhengzhou University with a Bachelor Degree in English. He thenobtained his Master Degree in Economics at University of International Business and Economics andhis Executive Master Degree in Business Administration at China Europe International BusinessSchool. Mr. Yu has over 20 years’ experience in the field of port management and successively servedas the Deputy General Manager and General Manager of China Communications Import and ExportCorporation, and the Deputy General Manager of Hoi Tung Marine Machinery Suppliers Limited. Heis also the Managing Director of China Merchants Bonded Logistics Co., Ltd., the Deputy Chairmanof Tianjin Haitian Bonded Logistic Company Limited and the Deputy Chairman of Asia AirfreightTerminal Company Limited.

COMPETING INTERESTS

As at the Latest Practicable Date, none of the Directors and their respective associates wasinterested in any business, apart from the Company’s business, that competes or competed or is or waslikely to compete, either directly or indirectly, with the Company’s business and there is no contractor arrangement subsisting at the Latest Practicable Date in which any Director is materially interestedand which is significant in relation to the Group’s business.

DIRECTORS’ INTEREST IN ASSETS

As at the Latest Practicable Date, none of the Directors had any direct or indirect interests in anyassets which have been acquired or disposed of by, or leased to, or which were proposed to be acquiredor disposed of by or leased to, any member of the Group since 31 December 2013 (being the date towhich the latest published audited consolidated financial statements of the Company were made up).

DIRECTORS’ INTEREST IN CONTRACT OR ARRANGEMENT

As at the Latest Practicable Date, none of the Directors is materially interested in any contractor arrangement which is significant to the business of the Group.

SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors has entered into any existing or proposedservice contracts with the Company, or any other member of the Group, save for those expiring ordeterminable by the relevant employer within one year without payment of compensation (other thanstatutory compensation).

LITIGATION

As at the Latest Practicable Date, none of the members of the Group was engaged in anylitigation or claims of material importance and, so far as the Directors are aware, no litigation or claimof material importance is pending or threatened by or against any member of the Group.


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A1A40(1)

A1B40(2)

A1B39

A1B33

QUALIFICATION AND CONSENT OF EXPERT

The following is the qualification of the expert (the “Expert”) who has given its letter for the

inclusion in this Prospectus:

Name Qualification

Deloitte Touche Tohmatsu Certified Public Accountants

As at the Latest Practicable Date, Deloitte Touche Tohmatsu has given and has not withdrawn its

written consent to the issue of this Prospectus, with the inclusion herein of its letter or references to

its name and/or its opinion in the form and context in which they respectively appear.

As at the Latest Practicable Date, Deloitte Touche Tohmatsu did not have any shareholding,

direct or indirect, in any member of the Group or any right (whether legally enforceable or not) to

subscribe for or to nominate persons to subscribe for securities in any member of the Group.

As at the Latest Practicable Date, Deloitte Touche Tohmatsu did not have any direct or indirect

interest in any asset which had been acquired, or disposed of by, or leased to any member of the Group,

or was proposed to be acquired, or disposed of by, or leased to any member of the Group since 31

December 2013, being the date to which the latest published audited consolidated financial statements

of the Group were made up.

MATERIAL CONTRACTS

The following contracts are all the material contracts (not being entered into in the ordinary

course of business of the Group) entered into by members of the Group, within the two years preceding

the Latest Practicable Date:

(a) the termination agreement dated 28 December 2012 entered into between the Company and

CMHK, pursuant to which the Company and CMHK agreed to terminate the entrustment

agreement dated 18 June 2010, under which CMHK granted the management rights and the

power to direct the voting right over the 117,465,000 ordinary shares of 中國南山開發（集團）股份有限公司 (China Nanshan Development (Group) Incorporation) (“China

Nanshan”) held by 廣東省廣業投資控股有限公司 (Guangdong Guangye Investment

Holdings Limited), representing approximately 23% of the issued share capital of China

Nanshan, to the Company;

(b) the entrustment agreement dated 17 September 2012 entered into between the Company and

China Nanshan, pursuant to which China Nanshan granted to the Company the management

rights and the power to direct the voting right over the entire interest in

深圳赤灣港航股份有限公司 (Shenzhen Chiwan Wharf Holdings Limited) held by China

Nanshan;


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A1B5(1),(2),(3)

A1B40(1)

A1B42

(c) the property interest transfer agreement dated 28 September 2012 entered into between

Shenzhen China Merchants Venture Co., Ltd (深圳市招商創業有限公司) (“CMV”),

Shenzhen China Merchants Real Estates Co., Ltd (深圳招商房地產有限公司) (“CMRE”)

and Shenzhen Malai Storage Company Limited (碼來倉儲（深圳）有限公司) (“SWZ”),

pursuant to which SWZ agreed to acquire the entire property interest in the Immigration

Building and the related parking spaces of China Merchants Ocean Centre (招商海運中心)

(“Ocean Centre”), located on Linhai Avenue of the Nanshan District in the PRC, from

CMV, which represents 46.7% property interest in the Ocean Centre;

(d) the share purchase agreement dated on 25 January 2013 entered into among China

Merchants (Luxembourg) S.à r.l., an indirect wholly-owned subsidiary of the Company, the

Company, CMA CGM SA, CMA Terminals Holding SAS and Terminal Link SAS whereby,

among other things, China Merchants (Luxembourg) S.à r.l. agreed to purchase and CMA

Terminals Holding SAS agreed to sell shares representing 49% of the issued shares in

Terminal Link SAS at an aggregate consideration of EUR400,000,000;

(e) the land use rights transfer agreement dated 25 March 2013 entered into between China

Merchants Zhangzhou Economic Development Zone Co., Ltd.

(招商局漳州開發區有限公司) (“China Merchants Zhangzhou”) and Xia Men Bay China

Merchants Terminals Co., Ltd. (漳州招商局廈門灣港務有限公司) (“Zhangzhou Xiamen

Bay”), pursuant to which China Merchants Zhangzhou agreed to sell and Zhangzhou

Xiamen Bay agreed to purchase the land use rights in respect of a parcel of land situated

at the Fourth District of the Zhangzhou Economic Development Zone located in Fujian, the

PRC, with a total site area of 299,232.859 square meters (including the sea use rights with

a site area of 172,831.724 square meters) at a total consideration of RMB134,654,787;

(f) the land use rights confirmation contract dated 23 July 2013 entered into between China

Merchants Shekou Industrial Zone Company Limited (招商局蛇口工業區有限公司)

(“CMSIZ”) and Antongjie Port and Warehouse Services (Shenzhen) Company Limited

(安通捷碼頭倉儲服務(深圳)有限公司)(“Antongjie”), pursuant to which CMSIZ agreed to

sell and Antongjie agreed to purchase the land use rights in respect of a parcel of land

situated at Mawan Road West, Shenzhen Qianhaiwan Logistics Park, Nanshan District,

Shenzhen, the PRC with a total site area of 13,108.93 square metres at a total consideration

of RMB9,940,895; and

(g) the Underwriting Agreement.

EXPENSES

The estimated expenses in connection with the Open Offer (including but not limited to the

printing, registration, legal, professional and accounting charges) are approximately HK$7 million and

are payable by the Company.


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A1B12

GENERAL

(a) The registered office of the Company is at 38th Floor, China Merchants Tower, Shun Tak

Centre, 168-200 Connaught Road Central, Hong Kong.

(b) The company secretary of the Company is Mr. Leung Chong Shun who is a solicitor of the

High Court of Hong Kong.

(c) The authorised representatives of the Company are Mr. Li Jianhong and Mr. Wang Hong of

38th Floor, China Merchants Tower, Shun Tak Centre, 168-200 Connaught Road Central,

Hong Kong.

(d) The Registrar of the Company is Computershare Hong Kong Investor Services Limited,

located at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East,

Wanchai, Hong Kong.

(e) The principal bankers of the Company are China Construction Bank Corporation, Industrial

and Commercial Bank of China Ltd., China Merchants Bank Co., Ltd. and Bank of China

Ltd.

(f) The legal adviser of the Company is Linklaters of 10th Floor, Alexandra House, Chater

Road, Hong Kong.

(g) The auditor of the Company is Messrs. Deloitte Touche Tohmatsu, Certified Public

Accountants of 35/F One Pacific Place, 88 Queensway, Hong Kong.

(h) The English text of this Prospectus shall prevail over the Chinese text.

DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES IN HONG KONG

A copy of each of the Open Offer Documents and the written consent referred to in the paragraph

headed “Qualification and Consent of Expert” in this appendix have been registered with the Registrar

of Companies in Hong Kong pursuant to section 38D of the Companies (Winding Up and

Miscellaneous Provisions) Ordinance.

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection during normal business hours

(Saturdays and public holidays excepted) at the registered office of the Company at 38th Floor, China

Merchants Tower, Shun Tak Centre, 168-200 Connaught Road Central, Hong Kong from the date of

this Prospectus up to and including Wednesday, 4 June 2014:

(a) the Memorandum and Articles;

(b) the material contracts referred to in the section headed “Material Contracts” of this

appendix;


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A1B36

A1B35A1B3A1B4

A1B43

(c) the annual reports of the Company for each of the three financial years ended 31 December

2011, 2012 and 2013;

(d) the accountants’ report from Deloitte Touche Tohmatsu relating to the unaudited pro forma

financial information of the Group, the text of which is set out in Appendix II to this

Prospectus; and

(e) the written consent from Deloitte Touche Tohmatsu referred to in the section headed

“Qualification and Consent of Expert” in this appendix.


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