Stock Code: 000553(200553) Stock Abbreviation: ADAMA A (B) NO. 2020-44
ADAMA Ltd.
Repurchase Plan for Part of the Company’s Domestically
Listed Foreign Shares (B share)
The Company and all members of the Company’s Board of Directors confirm that all
information disclosed herein is true, accurate and complete, with no false or misleading
statement or material omission.
Important Information:
1. Purpose of share repurchase: In order to protect the Company’s value and shareholders’
interests, the Company intends to repurchase (and cancel) a portion of its B-Shares (as
defined below), resulting in a corresponding reduction of the Company’s registered capital.
2. Type of shares to be repurchased: Domestically listed foreign shares (B shares)
(“B-Shares”).
3. Method of repurchasing: By means of centralized price bidding transactions through the
Shenzhen Stock Exchange and/or any other method/s permitted by the applicable laws and
regulations.
4. Price range: Shall not exceed 5.70 HKD/share (equivalent to 5.10 RMB/share),
representing 150% of the volume-weighted average price of the Company’s B-Shares over
the 30 trading days before the approval of the repurchase plan by the Board of Directors of
the Company (3.80 HKD).
5. Number of shares to be repurchased and their percentage of the total share capital:
The upper limit of the total shares to be repurchased by the Company is 26,000,000
shares, accounting for 1.1% of the Company’s current total shares (2,344,121,302)
and 15.6% of the Company’s total B shares (167,049,341);
The lower limit of the total shares to be repurchased by the Company is 13,000,000
shares, which accounts for 0.55% of the Company’s current total shares
(2,344,121,302) and 7.8% of the Company’s total B shares (167,049,341).
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The actual amount will be based on the actual number of shares repurchased by the end of
the Repurchase Period (as defined below).
6. Total funds to be used for the repurchase: Assuming the upper limit of the total shares
repurchased, as well as the ceiling repurchase price 5.70 HKD/share, the total funds to be
used for the repurchase shall not be more than RMB 132,562 thousand (equivalent to HKD
148,200 thousand) (based on 1 HKD = 0.89448 RMB, the middle rate of the exchange rate
of HKD to RMB on August 18, 2020.The actual amount of used HKD is converted at the
exchange rate on the day of the purchase of the foreign exchange, and will include in
addition the fees of foreign exchange purchasing, transaction fees and other related fees.)
7. Source of funds for the repurchase: The Company’s own funds.
8. Period of share repurchasing: The repurchasing period will not exceed 3 months following
the date of the Company’s shareholders’ approval of the repurchase plan (“Repurchase
Period”).
9. The repurchase of a portion of the Company’s B-Shares is subject to the approval of the
Company’s shareholders and shall require at least 2/3 of the voting rights represented by the
attending shareholders.
10. The Company’s directors, supervisors, senior executives, the controlling shareholder and
the actual controller have no plan to reduce their holdings during the Repurchase Period.
Risks:
1. This repurchase may not be implemented if the Repurchase Plan will not be approved by
the Company’s shareholders;
2. The funds used for the share repurchase are Hong Kong dollars, and the Company needs
to obtain the approval of the foreign exchange authority for the purchase and payment of
foreign exchange. This repurchase may not be implemented due to the funds required for the
repurchase of shares not being available in a timely manner;
3. During the Repurchase Period, the Company’s stock price may exceed the upper limit of
the repurchase plan price, resulting in uncertain risks such as the failure to implement the
repurchase plan or only partial implementation thereof;
4. If a major event that has a significant impact on the Company’s share price occurs or the
Company decides for substantive reasons to terminate the share repurchase plan, the share
repurchase plan may not be implemented as planned.
Main Contents:
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In order to protect the Company’s value and shareholders’ interests, the Company
formulated a repurchase plan for a portion of the Company’s B-Shares. The plan was
reviewed at the 26th meeting of the 8th session of the Board of Directors on August 19, 2020
with all 5 directors attending the meeting and voting in favor (with 0 votes against and 0
abstentions). The independent directors further issued an independent opinion on this matter.
The repurchase plan shall be subject to the approval of the Company’s shareholders by at
least 2/3 of the voting rights represented by the attending shareholders.
Following the completion of the repurchase of the shares according to the repurchase plan,
the cancellation of the shares repurchased, the decrease of the Company’s registered capital
and the corresponding amendments to the Articles of Association of the Company
(collectively referred to as “the above matters”) shall be subject to the Company’s
shareholders’ approval. Following approval of the shareholders, the cancellation of shares,
the decrease of the Company’s registered capital and the corresponding amendments to the
Articles of Association of the Company shall be completed within three years after the
Company discloses the announcement on the results of the repurchase and the change of the
shares. When the Board of Directors requests the shareholders to review the above matters,
it will also request the shareholders to authorize the Board of Directors to handle the above
matters. If the shareholders fail to approve the above matters, the repurchased shares shall be
transferred within three years in accordance with relevant regulations.
The repurchase plan is described as follows:
I．Reason and purpose
The overall B-share market has suffered for many years from a lack of liquidity and small
market size, contributing to the share price of the Company’s B-Shares being significantly
lower than the net asset value per share. Therefore, in order to protect the Company’s value
and the interests of all shareholders, enhance investor confidence, and reinforce the
Company’s commitment to effectively and efficiently return value to its shareholders, the
Company intends to repurchase a portion of its B-Shares.
II. The share repurchase meets the following conditions
1. The Company’s latest net asset per share was RMB 9.67 per share (approximately equal
to HKD 10.81 per share based on the exchange rate of the HKD to RMB on August 18, 2020,
1 Hong Kong dollar = RMB 0.89448).
The calculation of the latest net asset per share is as follows:
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RMB 22,669,778,000 (net assets attributable to shareholders of the Company as of June 30,
2020) /2,344,121,302 (total shares) = RMB 9.67/share.
For the ten trading days prior to the Company’s Board of Directors review of the repurchase
plan (from August 5, 2020 to August 18, 2020), the closing price of the B-Shares was
significantly lower than the Company’s net asset value per share in the most recent period.
Therefore, the repurchase of the Company’s B-Shares complies with the requirement in
Paragraph 2 of Article 2 of the Implementation Rules of the Shenzhen Stock Exchange on
Share Repurchases of Listed Companies: “The company’s closing stock price is lower than
the latest net asset value per share.”
2. The Company’s shares have been listed for more than one year.
3．After repurchasing the shares, the Company has the ability to fulfill its debts and continue
its regular operations.
4. The shareholding structure of the Company will comply with the listing requirements
after the repurchase.
5. Other requirements stipulated by China Securities Regulatory Commission.
III. Disposal of the shares repurchased
The repurchased shares will be cancelled according to applicable law and the Company’s
registered capital will be reduced accordingly.
IV. Type of shares repurchased
B-Shares.
V. Method of repurchasing
The Company will repurchase a portion of the Company’s B-Shares by means of centralized
price bidding transactions through Shenzhen Stock Exchange and/or other methods
permitted by the applicable laws and regulations.
VI. Price range and pricing principle
The price of the repurchase of the B-Shares shall not be higher than 150% of the
volume-weighted average price of the Company’s B-Shares over the 30 trading days before
the approval of the repurchase plan by the Board of Directors of the Company, i.e. not
higher than HKD 5.70 per share.
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The actual share repurchase price will be determined by the Company’s management, as
authorized by the Board of Directors, after the repurchase is initiated, depending on the
Company’s share price, general market and economic conditions, and other business
considerations.
Before the completion of the repurchase plan, if the Company implements a rights issue or
pays dividends, such as through a share-issuance, transfer of share capital or payment of
cash dividends, the above price limit shall be adjusted accordingly from the date of the stock
price ex-rights and ex-dividends.
VII. Number of shares to be repurchased and their percentage of the total share capital
Number of shares to be repurchased and their percentage of the total share capital:
The upper limit of the total shares to be repurchased by the Company is 26,000,000
shares, accounting for 1.1% of the Company’s current total shares (2,344,121,302)
and 15.6% of the Company’s total B shares (167,049,341);
The lower limit of the total shares to be repurchased by the Company is 13,000,000
shares, which accounts for 0.55% of the Company’s current total shares
(2,344,121,302) and 7.8% of the Company’s total B shares (167,049,341).
The actual amount will be based on the actual number of shares repurchased by the end of
the Repurchase Period (as defined below).
VIII. Total Funds to be used for the repurchase
Assuming the upper limit of the total shares repurchased 26,000,000, as well as the ceiling
repurchase price 5.70 HKD/share, the total funds to be used for the repurchase shall not be
more than RMB 132,562 thousand (equivalent to HKD 148,200 thousand (based on 1 HKD
= 0.89448 RMB, the middle rate of the exchange rate of HKD to RMB on August 18, 2020.
The actual amount of used HKD is converted at the exchange rate on the day of the purchase
of the foreign exchange, and will include in addition the fees of foreign exchange purchasing,
transaction fees and other related fees.)
IX. Source of repurchase capital
The Company will use its own funds to repurchase the B-Shares.
X. Period for repurchase
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The repurchase period of the shares will not exceed 3 months following the date of the
Company’s shareholders’ approval of the repurchase plan.
The repurchase of the shares shall be done in Hong Kong dollars after obtaining the consent
of the foreign exchange administration for the purchase and payment of foreign exchange.
If either the exercised amount used for the repurchase of the shares reaches the upper limit
or the number of shares repurchased reaches the maximum limit within this period, the
Company’s repurchase plan shall be considered to have been fully implemented, that is, the
repurchase period shall expire.
XI. Change in the Company’s share structure after the repurchase
1. Assuming the upper limit of the number of the shares to be repurchased, after the
completion of the repurchase, and after the Company’s shareholders will have considered
and approved the share cancellation and reduction of registered capital, the Company’s share
capital structure is expected to be as follows:
Before the repurchase After the repurchase
Item Number of Proportion Number of Proportion
shares (%) shares (%)
I. Restricted Shares 4,500 0.0002 4,500 0.0002
Including: Shares held by
4,500 0.0002 4,500 0.0002
domestic natural person
II. Shares not subject to
2,344,116,802 99.9998 2,318,116,802 99.9998
Trading Restriction
Including: RMB Ordinary
2,177,067,461 92.8735 2,177,067,461 93.9152
Shares
Domestically Listed
167,049,341 7.1263 141,049,341 6.0846
Foreign Shares
III. Total shares 2,344,121,302 100.0000 2,318,121,302 100.0000
2. Assuming the lower limit of the number of the shares to be repurchased, after the
completion of the repurchase, and after the Company’s shareholders will have considered
and approved the share cancellation and reduction of registered capital, the Company’s share
capital structure is expected to be as follows:
Before the repurchase After the repurchase
Item Number of Proportion Number of Proportion
shares (%) shares (%)
I. Restricted Shares 4,500 0.0002 4,500 0.0002
Including: Shares held by
4,500 0.0002 4,500 0.0002
domestic natural person
II. Shares not subject to
2,344,116,802 99.9998 2,331,116,802 99.9998
Trading Restriction
Including: RMB Ordinary
2,177,067,461 92.8735 2,177,067,461 93.3914
Shares
Domestically Listed
167,049,341 7.1263 154,049,341 6.6084
Foreign Shares
III. Total shares 2,344,121,302 100.0000 2,331,121,302 100.0000
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XII. Analysis of the management on the influences of the share repurchase on the
Company’s business operations, profitability, finance, R&D and debt payment ability,
future development and maintenance of the listing status, etc. The commitment of all
directors that the share repurchase will not damage the listed company’s debt payment
ability and going-concern ability.
The Company’s management believes that the repurchase of a portion of the Company’s
B-Shares will enhance investor confidence and reinforce the Company’s commitment to
effectively and efficiently return value to its shareholders.
As of June 30, 2020, the total consolidated current assets, assets and owners’ equity
attributable to the parent company of the Company were RMB 28,900,868 thousand, RMB
49,096,179 thousand and RMB 22,669,778 thousand, respectively. The upper limit of capital
RMB 132,562 thousand to be used to repurchase the shares accounts for 0.46%, 0.27%, and
0.58% of total current assets, total assets, and equity attributable to the parent company’s
equity.
Considering the Company’s current and future operating and financial development plans,
the maximum total amount of repurchase funds of the Company to be used for the
repurchase plan, which is RMB 132,562 thousand, will not have a negative impact on the
Company’s business operations, profitability, finance, research and development, debt
repayment ability, future development, etc. The implementation of the share repurchase plan
will not cause changes in the Company’s control rights, will not change the Company’s
status as a listed company, and will not cause the Company’s shareholding distribution to
fall short of listing conditions.
All directors of the Company confirmed that the share repurchase will not harm the
Company’s ability to pay its debts and continue its regular operations.
XIII. Whether the directors, supervisors, senior executives, the controlling shareholder,
and the actual controller of listed companies have bought or sold the Company’s shares
within six months before the board of directors makes a decision to repurchase shares,
whether there is any insider trading alone or jointly with others, and description of
market manipulation and a description of plans to increase or decrease shares during
the Repurchase Period
On June 15, 2020, China National Agrochemical Co., Ltd. transferred all its direct share
equity in the Company to Syngenta Group Co., Ltd. For details, please refer to the
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Announcement on the Completion of the Registration of the Transfer of State-owned Shares
held by the Controlling Shareholder (Announcement No. 2020-33).
Except the above share transfer, the directors, supervisors, senior executives, the controlling
shareholder, and the actual controller of the Company did not buy or sell the Company’s
shares within six months prior to the Board of Directors approving the repurchase plan;
There has been no insider trading or market manipulation alone or jointly with others by the
directors, supervisors, senior executives, the controlling shareholder, and the actual
controller of the Company, and the directors, supervisors, senior executives, the controlling
shareholder, and the actual controller of the Company have no plan to increase or reduce
their shares during the Repurchase Period.
XIV. Relevant arrangements for the cancellation of the shares following repurchase
according to the law
Following the completion of the repurchase of the shares according to the repurchase plan,
the Board of Directors shall propose to the shareholders to approve the cancellation of the
repurchased shares, the decrease of the Company’s registered capital and the corresponding
amendments to the Articles of Association of the Company, and further request that the
shareholders authorize the Board of Directors of the Company to handle the above matters.
After the shareholders’ meeting will have reviewed and approved the share cancellation, the
reduction of the registered capital and the corresponding amendments to the Company’s
Articles of Association, the Company will submit applications for the cancellation of the
repurchased shares and the reduction of the registered capital to the Shenzhen Stock
Exchange and China Registration and Clearing Corporation (Shenzhen Branch),
respectively.
After the share cancellation will be completed, the Company will make corresponding
amendments to the relevant provisions in the Articles of Association of the Company
regarding the amount of registered capital, the total share capital and the shareholding
structure, and file the industrial and commercial registration.
XV. Relevant arrangements to prevent infringement of the interests of creditors
After the share repurchase is completed and the shareholders consider and approve the share
cancellation proposal, the Company will notify its creditors of the intended share
cancellation in accordance with the relevant provisions of the Company Law to fully protect
the legal rights and interests of the creditors.
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XVI. Specific authorization for share repurchase matters
In order to legally, efficiently and orderly implement the repurchase plan, the Board of
Directors authorizes any two of the senior executives of the Company to jointly manage all
matters in relation to the repurchase of the shares pursuant to the relevant regulatory
documents and the Articles of Association of the Company. Authorizations herein include
without limitation:
1. Choose the opportunity to repurchase shares within the repurchase period, and determine
the specific repurchase timing, price, quantity, etc.;
2. According to the Company’s actual situation and stock price performance, decide to
continue or terminate the implementation of this repurchase plan;
3. This authorization starts from the day when the Company’s shareholders approve the
share repurchase plan to the day when the above authorization matters are completed;
4. Other matters not listed above but necessary for this share repurchase.
XVIII. Risks
1. The repurchase plan may not be implemented if it will not be approved by the Company’s
shareholders;
2. The capital used for this share repurchase is Hong Kong dollars, and the Company needs
to obtain the approval of the foreign exchange authority for the purchase and payment of
foreign exchange for this repurchase. This repurchase may not be implemented if the funds
required for the repurchase of shares will not be available in a timely manner;
3. During the Repurchase Period, the Company’s stock price may exceed the upper limit of
the repurchase plan price, resulting in uncertain risks such as the failure to implement the
repurchase plan or partial implementation thereof;
4. If a major event that has a significant impact on the Company’s share price occurs or the
Company decides for substantive reasons to terminate the share repurchase plan, the share
repurchase plan may not be implemented as planned.
The Announcement is hereby made.
The Board of Directors of ADAMA Ltd.
August 21, 2020
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