Kong Sun Proposes to Acquire 44.587% Equity Interests in a Leading Photovoltaic Power Plant Construction Company for RMB347.8 Million

HONG KONG, Dec. 4, 2015 /PRNewswire/ -- Kong Sun Holdings Limited ("Kong Sun" or the "Company" (HK: 0295), which together with its subsidiaries is referred to as the "Group"), which invests in and operates photovoltaic ("PV") power stations, announces today that the Group has entered into an acquisition agreement with independent third parties and proposed to acquire 44.587% equity interests in Zhongke Hengyuan Technology Co., Ltd. ("Zhongke") for the consideration of RMB347.8 million, which will be settled in cash through internal resources or proceeds from fund raising activities.

Zhongke has a leading position in the new energy sector, especially in the solar PV industry with many years' rich experience in the construction and development of PV power station projects as well as manufacture and sale of wind-solar hybrid street lights. For the last two financial years, Zhongke recorded a total after tax profit of approximately RMB90.72 million according to the consolidated management accounts. Upon completion of the acquisition, Zhongke would be accounted for using the equity method as "Investment in a Joint Venture" in the consolidated financial statements of the Group and is expected to bring immediate profit contribution to the Group.

Dr. Liu Wen Ping, Executive Director of Kong Sun, commented, "The proposed acquisition can help complement our existing business and accelerate the development of self-construction PV power plants through Zhongke. It also allows us to increase our business scale, project reserve and further extend our business scopes to engineering, procurement and construction (EPC), operation and maintenance of PV power plant projects as well as wind-solar hybrid street lights business. The above-mentioned businesses and service will further strengthen our profitability and diversify the layout of our new energy business. Finally, we will significantly strengthen our technological competence by acquiring Zhongke's leading technological know-how and R&D capabilities. Supported by a series of favourable policies for the PV industry in China, we will continue to explore the PV power plant investment opportunity and EPC business with the aim of bringing long-term returns to shareholders."

Since this proposed acquisition will constitute a major transaction under the Listing Rules for the Company, it is subject to the approval by the shareholders at an extraordinary general meeting.

List of grid-connected photovoltaic projects:

Company Profile

Kong Sun principally engages in the investment and operation of photovoltaic power station projects across various provinces and regions of China. It currently owns grid-connected projects in Hami, Yingjisha, Kuche, Wushi, Hejing, Makit County and Artux of Xinjiang, Yumen, Jiuquan and Lanzhou of Gansu, Weixian of Hebei as well as several photovoltaic power plants under development across China.

In addition, since 2014, Kong Sun has entered into a number of memorandum of understanding and agreements for the investment in and development of photovoltaic power plants in Gansu, Hebei, Inner Mongolia, Anhui, Yunnan and Xinjiang provinces of China.

Kong Sun is a constituent of MSCI Global Small Cap Indexes -- China. It has also been selected as constituent of the Hang Seng Global Composite Index & Hang Seng Composite Index.