china minzhong food corporation limited€¦ · this circular is important as it contains the...

CIRCULAR DATED 4 OCTOBER 2013

THIS CIRCULAR IS IMPORTANT AS IT CONTAINS THE RECOMMENDATION OF THE DIRECTORS OF CHINA

MINZHONG FOOD CORPORATION LIMITED AND THE ADVICE OF PRICEWATERHOUSECOOPERS

CORPORATE FINANCE PTE LTD. THIS CIRCULAR REQUIRES YOUR IMMEDIATE ATTENTION. PLEASE

READ IT CAREFULLY.

This Circular is issued by China Minzhong Food Corporation Limited (the “Company”). If you are in any doubt

in relation to this Circular or as to the action you should take, you should consult your stockbroker, bank

manager, accountant, solicitor, tax adviser or other professional adviser immediately.

If you have sold or transferred all your issued and paid-up ordinary shares in the capital of the Company, you

should immediately forward this Circular to the purchaser or transferee or to the bank, stockbroker or other

agent through whom the sale or transfer was effected for onward transmission to the purchaser or transferee.

The Singapore Exchange Securities Trading Limited assumes no responsibility for the correctness of any of

the statements made, reports contained or opinions expressed in this Circular.

CHINA MINZHONG FOOD CORPORATION LIMITED(Company Registration Number: 200402715N)

(Incorporated in the Republic of Singapore)

CIRCULAR TO SHAREHOLDERS

in relation to the

MANDATORY UNCONDITIONAL CASH OFFER

by

UOB KAY HIAN PRIVATE LIMITED(Company Registration Number: 197000447W)


for and on behalf of

PT INDOFOOD SUKSES MAKMUR TBK(Incorporated in Indonesia)

to acquire all the issued and paid-up ordinary shares in the capital of the Company other than those already

owned, controlled or agreed to be acquired by PT Indofood Sukses Makmur Tbk as at the date of the Offer

(as defined herein)

Independent Financial Adviser to the Directors of the Company

(Company Registration Number: 197501605H)


SHAREHOLDERS SHOULD NOTE THAT THE OFFER DOCUMENT (AS DEFINED HEREIN) STATES THAT

THE OFFER WILL CLOSE AT 5.30 P.M. (SINGAPORE TIME) ON 18 OCTOBER 2013, THE OFFEROR DOES

NOT INTEND TO EXTEND THE OFFER BEYOND 5.30 P.M. (SINGAPORE TIME) ON 18 OCTOBER 2013

AND THE OFFEROR DOES NOT INTEND TO REVISE THE OFFER PRICE (AS DEFINED HEREIN).

TABLE OF CONTENTS

PAGE

DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . 6

SUMMARY TIMETABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

LETTER TO SHAREHOLDERS FROM THE BOARD OF DIRECTORS . . . . . . . . . . . . . . 8

1. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

2. THE OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

3. IRREVOCABLE UNDERTAKINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

4. INFORMATION ON THE OFFEROR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

5. RATIONALE FOR THE OFFER AND THE OFFEROR’S INTENTIONS FOR THE

COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

6. THE OFFEROR’S INTENTIONS REGARDING LISTING STATUS AND

COMPULSORY ACQUISITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

7. ADVICE AND RECOMMENDATION IN RELATION TO THE OFFER . . . . . . . . . . . . 17

8. ACTION TO BE TAKEN BY SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

9. INFORMATION PERTAINING TO CPFIS INVESTORS . . . . . . . . . . . . . . . . . . . . . . . 22

10. OVERSEAS SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

11. DIRECTORS’ RESPONSIBILITY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

APPENDIX I LETTER FROM PwCCF TO THE DIRECTORS . . . . . . . . . . . . . . . . . . . I-1

APPENDIX II ADDITIONAL GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . II-1

APPENDIX III UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS OF THE

GROUP FOR FY2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1

APPENDIX IV RELEVANT ARTICLES IN THE ARTICLES OF ASSOCIATION OF

THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1

1

DEFINITIONS

In this Circular, the following definitions apply throughout except where the context otherwise

requires:

GENERAL

“2013 Dividend” : The first and final dividend of S$0.01 per Share as announced

on 29 August 2013 in the Company’s financial statement

announcement for the financial year ended 30 June 2013

“Articles of Association” : The articles of association of the Company

“Board” : Board of Directors of the Company

“China Minzhong

Holdings Limited”

: A company incorporated in the British Virgin Islands and

which is solely owned by Mr Siek Wei Ting, the Chief Financial

Officer of the Company, who is holding the entire share capital

of China Minzhong Holdings Limited on trust for Mr Lin Guo

Rong, Mr Wang Dazhang and Mr Huang Bing Hui, who are the

management shareholders of the Company, in the respective

proportions of 24.12%, 37.94% and 37.94%

“Circular” : This Circular to Shareholders in relation to the Offer setting

out, inter alia, the recommendation of the Directors and the

advice of PwCCF to the Directors in respect of the Offer

“Closing Date” : 5.30 p.m. on 18 October 2013, being the last day for

lodgement of acceptances for the Offer

“Code” : The Singapore Code on Take-overs and Mergers

“Companies Act” : The Companies Act, Chapter 50 of Singapore

“Company Securities” : (a) Shares, (b) securities which carry voting rights in the

Company, (c) convertible securities, warrants, options and

derivatives in respect of Shares or such securities in (b)

“CPF Agent Banks” : Agent banks included under the CPFIS

“CPFIS” : Central Provident Fund Investment Scheme

“CPFIS Investors” : Investors who have purchased Shares using their CPF

contributions pursuant to the CPFIS

“Directors” : The directors of the Company (all of whom are considered

independent for the purpose of making a recommendation to

Shareholders in respect of the Offer) as at the Latest

Practicable Date, namely, Mr Lin Guo Rong, Mr Lee Edan

Kietchai, Mr Anson Wang, Mr Lim Yeow Hua @ Lim You Qin,

Mr Heng Hock Kiong @ Heng Hang Siong and Mr Lim Gee

Kiat

“Encumbrances” : Any liens, equities, mortgages, charges, encumbrances,

rights of pre-emption and other third party rights and interests

of any nature whatsoever

2

“ESOS Options” : Options to subscribe for new Shares granted under the

Scheme

“FAA” : Form of Acceptance and Authorisation, which forms part of the

Offer Document and which is issued to Shareholders whose

Shares are deposited with CDP

“FAT” : Form of Acceptance and Transfer, which forms part of the

Offer Document and which is issued to Shareholders whose

Shares are not deposited with CDP

“FY” : Financial year ended or ending on, as the case may be, 30 June

“IFA Letter” : The letter dated 4 October 2013 from PwCCF to the Directors

in respect of the Offer as set out in Appendix I to this Circular

“Latest Practicable Date” : 30 September 2013, being the latest practicable date prior to

the printing of this Circular, save that where parts of the Offer

Document (including the letter from UOBKH to the

Shareholders in the Offer Document) are reproduced,

references to the “Latest Practicable Date” in such

reproduction shall mean the Offer Document LPD

“Listing Manual” : The Listing Manual of the SGX-ST

“Market Day” : A day on which the SGX-ST is open for trading of securities

“Offer” : The mandatory unconditional cash offer by UOBKH, for and

on behalf of the Offeror, to acquire the Offer Shares on the

terms and subject to the conditions set out in the Offer

Document, the FAA and the FAT

“Offer Announcement” : The announcement of the Offer by UOBKH, for and on behalf

of the Offeror, on the Offer Announcement Date

“Offer Announcement

Date”

: 2 September 2013, being the date of the Offer Announcement

“Offer Document” : The offer document dated 20 September 2013 issued by

UOBKH, for and on behalf of the Offeror, in respect of the

Offer

“Offer Document LPD” : 12 September 2013, stated in the Offer Document to be the

latest practicable date prior to the printing of the Offer

Document

“Offer Price” : S$1.12 in cash for each Offer Share

“Offer Shares” : The Shares, other than those Shares held by the Company as

treasury shares and those Shares owned, controlled or

agreed to be acquired, directly or indirectly, by the Offeror as

at the date of the Offer

3

“Offeror Securities” : (a) Shares of the Offeror, (b) securities which carry

substantially the same rights as any shares of the Offeror, and

(c) convertible securities, warrants, options and derivatives in

respect of any such shares of the Offeror in (a) or such

securities in (b)

“Overseas Shareholders” : Shareholders whose addresses are outside Singapore, as

shown in the Register or, as the case may be, in the records

of CDP

“PRC” : The People’s Republic of China

“Register” : The register of holders of the Shares, as maintained by the

Registrar

“RMB” : Renminbi, the lawful currency of the PRC

“Scheme” : The CMZ Employee Share Option Scheme 2010

“Securities Account” : The securities account maintained by a depositor with CDP

but not including a securities sub-account

“Shareholders” : Holders of Offer Shares, including depositors whose Offer

Shares are deposited with CDP or who have purchased Offer

Shares on the SGX-ST

“Shares” : Issued and paid-up ordinary shares in the capital of the

Company

“S$” and “cents” : Singapore dollars and cents, respectively, being the lawful

currency of Singapore

“Unconditional

Announcement”

: The announcement made by UOBKH on 4 September 2013,

for and on behalf of the Offeror, announcing that the Offer

(when made pursuant to the Offer Document) has turned

unconditional in all respects

“Undertaking

Shareholders”

: Mr Lin Guo Rong, Mr Siek Wei Ting, China Minzhong Holdings

Limited, Mr Wang Dazhang and Mr Huang Bing Hui

“%” or “per cent.” : Percentage or per centum

COMPANIES/ORGANISATIONS

“CDP” : The Central Depository (Pte) Limited

“Company” or “CMZ” : China Minzhong Food Corporation Limited

“Group” : The Company and its subsidiaries

“Offeror” : PT Indofood Sukses Makmur Tbk

“PwCCF” or “IFA” : PricewaterhouseCoopers Corporate Finance Pte Ltd, the

appointed independent financial adviser to the Directors in

respect of the Offer

“Registrar” : Boardroom Corporate & Advisory Services Pte. Ltd.

4

“SGX-ST” : Singapore Exchange Securities Trading Limited

“SIC” : Securities Industry Council of Singapore

“UOBKH” : UOB Kay Hian Private Limited

Unless otherwise defined, the terms “acting in concert” and “associates” shall have the

meanings ascribed to them in the Code.

The terms “depositor” and “depository register” shall have the meanings ascribed to them in

Section 130A of the Companies Act.

The terms “subsidiary” and “related corporation” shall have the meanings ascribed to them

respectively in Section 5 and Section 6 of the Companies Act.

The term “Controlling Shareholder” shall have the meaning ascribed to it in the Listing Manual.

References to “you” and “your” in this Circular are to the Shareholders.

The headings in this Circular are inserted for convenience only and shall be ignored in construing

this Circular.

Words importing the singular shall, where applicable, include the plural and vice versa and words

importing one gender shall include the other gender. References to persons shall, where

applicable, include corporations.

Any reference in this Circular to any enactment is a reference to that enactment as for the time

being amended or re-enacted. Any word defined under the Companies Act, the Listing Manual or

the Code or any statutory or regulatory modification thereof and used in this Circular shall, where

applicable, have the meaning assigned to it under the Companies Act, the Listing Manual or the

Code or any statutory or regulatory modification thereof, as the case may be, unless the context

otherwise requires.

Any reference to a time of day and date in this Circular is made by reference to Singapore time

and date, unless otherwise stated.

Any discrepancies in figures included in this Circular between the amounts shown and the total

thereof are due to rounding. Accordingly, figures shown as totals in this Circular may not be an

arithmetic aggregation of the figures that precede them.

References in this Circular to the total number of issued Shares are based on 655,439,000 Shares

as at the Latest Practicable Date.

Capitalised terms used in extracts of the Offer Document shall have the same meanings as

ascribed to them in the Offer Document.

5

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

All statements other than statements of historical facts included in this Circular are or may be

forward-looking statements. Forward-looking statements include but are not limited to those using

words such as “aim”, “seek”, “expect”, “anticipate”, “estimate”, “believe”, “intend”, “project”, “plan”,

“potential”, “strategy”, “forecast”, “possible”, “probable” and similar expressions or future or

conditional verbs such as “if”, “will”, “would”, “should”, “could”, “may” or “might”. These statements

reflect the Company’s current expectations, beliefs, hopes, intentions or strategies regarding the

future and assumptions in light of currently available information as at the Latest Practicable Date.

Such forward-looking statements are not guarantees of future results, performance, events or

achievements and involve known and unknown risks and uncertainties. Accordingly, actual results

or outcomes may differ materially from those described in such forward-looking statements. Given

the risks and uncertainties involved, Shareholders and investors should not place undue reliance

on such forward-looking statements, and neither the Company nor PwCCF assumes any

obligation to update publicly or revise any forward-looking statement, subject to compliance with

all applicable laws and regulations and/or rules of the SGX-ST and/or any other regulatory or

supervisory body or agency.

6

SUMMARY TIMETABLE

Date of Despatch of Offer Document : 20 September 2013

Date of Despatch of Circular : 4 October 2013

Closing Date : 5.30 p.m. on 18 October 2013, being the last

day for the lodgement of acceptances for the

Offer

Settlement of consideration for valid

acceptances of the Offer

: Within 10 days of the date of receipt of

acceptances by the Offeror which are

complete and valid in all respects and are

received on or before 5.30 p.m. (Singapore

time) on the Closing Date

7

CHINA MINZHONG FOOD CORPORATION LIMITED(Company Registration Number: 200402715N)


LETTER TO SHAREHOLDERS FROM THE BOARD OF DIRECTORS

Directors: Registered Office:

Mr Lin Guo Rong (Executive Chairman and Chief Executive Officer)

Mr Lee Edan Kietchai (Non-Executive and Non-Independent Director)

Mr Wang Anson (Non-Executive and Non-Independent Director)

Mr Lim Yeow Hua (Non-Executive and Lead Independent Director)

Mr Heng Hang Siong (Non-Executive and Independent Director)

Mr Lim Gee Kiat (Non-Executive and Independent Director)

9 Battery Road

#15-01 Straits

Trading Building

Singapore 049910

4 October 2013

To: The Shareholders of China Minzhong Food Corporation Limited

Dear Sir/Madam,

MANDATORY UNCONDITIONAL CASH OFFER BY UOBKH, FOR AND ON BEHALF OF THE

OFFEROR, FOR THE OFFER SHARES

1. INTRODUCTION

1.1 Offer Announcement

On the Offer Announcement Date, UOBKH announced, for and on behalf of the Offeror, that:

(a) the Offeror had on the same day, agreed to acquire pursuant to married deals, an

aggregate of 25,590,000 issued Shares, representing approximately 3.90% of the total

number of issued Shares as at the Offer Announcement Date, at the price of S$1.12 per

Share (the “Acquisition”);

(b) following the Acquisition, the Offeror owned, controlled or had agreed to acquire an

aggregate of 219,525,382 Shares, representing approximately 33.49% of the total

number of issued Shares; and

(c) as a result of the aforesaid and in accordance with Rule 14.1 of the Code, the Offeror

intended to make a mandatory conditional cash offer for the Offer Shares at the Offer Price.

A copy of the Offer Announcement is available on the website of the SGX-ST at www.sgx.com.

1.2 Unconditional Announcement

Subsequent to the Offer Announcement, the Offeror acquired more Shares from the market and on

4 September 2013, UOBKH announced, for and on behalf of the Offeror, that pursuant to the

acquisition by the Offeror on 3 September 2013 of an aggregate of 49,365,000 Shares, the Offeror

and persons acting in concert with it owned, controlled or had agreed to acquire an aggregate of

338,355,382 Shares, representing approximately 51.22% of the maximum potential issued share

capital of the Company1. Accordingly, the Offer (when made) will be unconditional in all respects.

1 In this Circular, “maximum potential issued share capital of the Company” means the total number of Shares

which would be in issue had all the ESOS Options been validly exercised, vested or released (as the case may be)

as at the date of such declaration.

8

A copy of the Unconditional Announcement is available on the website of the SGX-ST at

www.sgx.com.

1.3 Offer Document

Shareholders should have by now received a copy of the Offer Document, as announced by

UOBKH to have been despatched on 20 September 2013, setting out, inter alia, the terms

and conditions of the Offer. The principal terms and conditions of the Offer are set out in

Section 2 of the Offer Document. Shareholders are urged to read the terms and

conditions of the Offer set out in the Offer Document carefully.

A copy of the Offer Document is available on the website of the SGX-ST at www.sgx.com.

1.4 Independent Financial Adviser

PwCCF has been appointed as the independent financial adviser to the Directors in respect

of the Offer.

1.5 Purpose of Circular

The purpose of this Circular is to provide Shareholders with relevant information pertaining

to the Offer and to set out the recommendation of the Directors and the advice of PwCCF to

the Directors in respect of the Offer.

Shareholders should read the Offer Document, this Circular and the IFA Letter set out

in Appendix I to this Circular carefully and consider the recommendation of the

Directors and the advice of PwCCF to the Directors in respect of the Offer before

deciding whether or not to accept the Offer.

If you are in any doubt about the Offer, you should consult your stockbroker, bank

manager, accountant, solicitor, tax adviser or other professional adviser immediately.

2. THE OFFER

2.1 Offer Terms

Based on the information set out in the Offer Document, UOBKH has, for and on behalf of

the Offeror, made the Offer to acquire all the Offer Shares on the terms and subject to the

conditions set out in the Offer Document, the FAA and the FAT, on the following basis:

(a) For each Offer Share: S$1.12 in cash

Shareholders should note that the Offeror has given notice that the Offeror does

not intend to revise the Offer Price.

(b) The Offer Shares will be acquired (a) fully paid, (b) free from all Encumbrances, and (c)

together with all rights, benefits and entitlements attached thereto as at the Offer

Announcement Date and thereafter attaching thereto (including the right to receive and

retain all dividends, other distributions and return of capital (if any) which may be

announced, declared, paid or made thereon by the Company on or after the Offer

Announcement Date).

9

Without prejudice to the generality of the foregoing, the Offer Price has been

determined on the basis that the Offer Shares will be acquired with the right to receive

any dividends that may be declared, made or paid by the Company on or after the Offer

Announcement Date (including the 2013 Dividend). In the event any dividend has been

paid by the Company to a Shareholder who accepts the Offer, the Offer Price payable

to such accepting Shareholder shall be reduced by an amount which is equal to the

amount of such dividend paid by the Company to such accepting Shareholder.

Accordingly, the following will apply if any dividend (including the 2013 Dividend) is

declared, made or paid by the Company on or after the Offer Announcement Date:

(I) if the settlement date in respect of the Offer Shares accepted pursuant to the Offer

falls on or before the books closure date for the determination of entitlements to

the dividend (“Books Closure Date”), the Offeror will pay the relevant accepting

Shareholders the Offer Price of S$1.12 in cash for each Offer Share, as the Offeror

will receive the dividend in respect of those Offer Shares from the Company; and

(II) if the settlement date in respect of the Offer Shares accepted pursuant to the Offer

falls after the Books Closure Date, the amount of the dividend in respect of such

Offer Shares will be deducted from the Offer Price payable for such Offer Shares

and the relevant Shareholders will receive S$1.11 in cash for each Offer Share, as

the Offeror will not receive the dividend in respect of those Offer Shares from the

Company.

2.2 Offer Shares

The Offer will be extended, on the same terms and conditions, to all new Shares

unconditionally issued or to be issued pursuant to the valid exercise of any ESOS Option to

subscribe for new Shares granted under the Scheme, on or prior to the close of the Offer.

For the purposes of the Offer, the expression “Offer Shares” shall include the aforesaid

Shares.

2.3 Unconditional Offer

The Offer is unconditional in all respects.

2.4 ESOS Options

Under the rules of the Scheme, the ESOS Options are not freely transferable by the holders

thereof. In view of this restriction, the Offeror will not make an offer to acquire the ESOS

Options. However, as stated in the Offer Document, the Offer will be extended to all new

Shares unconditionally issued or to be issued pursuant to the valid exercise on or prior to the

close of the Offer of any such ESOS Options.

As at the Latest Practicable Date, there are 5,140,000 outstanding ESOS Options granted

under the Scheme, which are held by the Undertaking Shareholders (excluding China

Minzhong Holdings Limited).

2.5 Warranty

Acceptance of the Offer will be deemed to constitute an unconditional and irrevocable

warranty by the accepting Shareholder that each Offer Share tendered in acceptance of the

Offer is sold by the accepting Shareholder, as or on behalf of the beneficial owner(s) thereof,

(a) fully paid, (b) free from all Encumbrances, and (c) together with all rights, benefits and

10

entitlements attached thereto as at the Offer Announcement Date and thereafter attaching

thereto (including the right to receive and retain all dividends, other distributions and return

of capital (if any) which may be announced, declared, paid or made thereon by the Company

on or after the Offer Announcement Date).

2.6 Closing Date

Shareholders should note that the Offer Document states that the Offer will close at

5.30 p.m. (Singapore time) on 18 October 2013 and that the Offeror does not intend to

extend the Offer beyond 5.30 p.m. (Singapore time) on 18 October 2013. As such,

notice has been given by the Offeror that the Offer will not be open for acceptance

beyond 5.30 p.m. (Singapore time) on 18 October 2013.

2.7 Details of the Offer

Appendix IV to the Offer Document contains further details on the Offer, namely (a) the

settlement of the consideration for the Offer, (b) the requirements relating to the

announcement of the level of acceptances of the Offer, and (c) the right of withdrawal of

acceptances of the Offer.

2.8 Procedures for Acceptance

The procedures for acceptance of the Offer are set out in Appendix V to the Offer Document.

3. IRREVOCABLE UNDERTAKINGS

The information on the irrevocable undertakings received by the Offeror to accept or reject

the Offer set out in italics below has been extracted from Section 3 of the Offer Document.

All terms and expressions used in the extract below shall have the same meanings as those

defined in the Offer Document, unless otherwise stated.

“3. IRREVOCABLE UNDERTAKINGS

3.1 Certain parties (the “Undertaking Shareholders”) have given irrevocable undertakings

(the “Irrevocable Undertakings”) in favour of the Offeror to, inter alia, reject or procure

the rejection of the Offer in respect of (a) the Offer Shares held, directly or indirectly, or

controlled by them, and (b) any Offer Shares which they may acquire (including

pursuant to the valid exercise of any outstanding ESOS Options on or prior to the close

of the Offer) on or after the date of their respective Irrevocable Undertakings.

The aggregate number of Shares under the Irrevocable Undertakings is 43,504,000

Shares, representing approximately 6.64% of the total issued Shares.

11

Details of the shareholdings of the Undertaking Shareholders as at the Latest

Practicable Date are as set out below:

S/No. Undertaking

Shareholders

Direct Interest Deemed Interest Percentage of Shares

as at the Latest

Practicable Date

No. of Shares % No. of Shares % No. of Shares %

1. Mr. Lin Guo Rong(1) 13,103,000 2.00 22,411,297 3.42 35,514,297 5.42

2. Mr. Siek Wei Ting(1) 7,989,703 1.22 22,411,297 3.42 30,401,000 4.64

3. Minzhong BVI(1) 22,411,297 3.42 – – 22,411,297 3.42

4. Mr. Wang Dazhang(1) – – 22,411,297 3.42 22,411,297 3.42

5. Mr. Huang Bing Hui(1) – – 22,411,297 3.42 22,411,297 3.42

Note:

(1) Minzhong BVI owns 22,411,297 Shares, representing approximately 3.42% of the total issued Shares.

Minzhong BVI is solely owned by Mr. Siek Wei Ting, the Chief Financial Officer of the Company, who

is holding the entire share capital in Minzhong BVI on trust for the following individuals in the respective

proportions:

(a) Mr. Lin Guo Rong, Executive Chairman and Chief Executive Officer of the Company: 24.12%

(b) Mr. Wang Dazhang, Chief Operations Officer of the Company: 37.94%

(c) Mr. Huang Bing Hui, Chief Technology Officer of the Company: 37.94%

3.2 Pursuant to their respective Irrevocable Undertaking, each Undertaking Shareholder

has undertaken, inter alia, the following:

(a) to reject the Offer (including any revised or improved Offer by or on behalf of the

Offeror) in respect of all the Offer Shares held, directly or indirectly, or controlled

by it (as described in paragraph 3.1 above) and any Offer Shares which they may

acquire (including pursuant to the valid exercise of any outstanding ESOS Options

on or prior to the close of the Offer) on or after the date of their respective

Irrevocable Undertakings (the “Relevant Shares”); and

(b) during the period commencing on the date of its Irrevocable Undertaking and

ending on the Closing Date, not to:

(i) accept any other offer for all or any of the Relevant Shares; or

(ii) directly or indirectly sell, transfer, give or otherwise dispose of (other than

with the prior written consent of the Offeror), create an Encumbrance over or

enter into any other arrangement that transfers to another any legal,

beneficial or economic consequences of ownership of, all or any of the

Relevant Shares.

The aggregate amount which would otherwise be payable by the Offeror as

consideration for the Offer Shares held by the Undertaking Shareholders shall be

referred to as the “Excluded Amount”.

3.3 Each Irrevocable Undertaking will lapse on the date on which the Offer closes, lapses

or is withdrawn, or such other date as may be extended by the mutual written agreement

of the Offeror and the relevant Undertaking Shareholder, subject to the consent of the

SIC and the requirements of the Code.”

12

4. INFORMATION ON THE OFFEROR

The information on the Offeror set out in italics below has been extracted from Section 4 of

the Offer Document. All terms and expressions used in the extract below shall have the same

meanings as those defined in the Offer Document, unless otherwise stated.

“4. INFORMATION ON THE OFFEROR

The Offeror is a company incorporated in Indonesia on 14 August 1990 and is listed on

the Indonesia Stock Exchange.

Over a number of decades, the Offeror has been progressively transformed to become

a Total Food Solutions company with operations in all stages of food manufacturing

from the production of raw materials and their processing through to consumer products

in the market. Today, it is renowned as a well-established company and a leading player

in each category of business in which it operates. In its business operation, the Offeror

capitalised on its resilient business model with four (4) complementary Strategic

Business Groups, namely:

(a) Consumer Branded Products Group, which is conducted by ICBP, a company

incorporated in Indonesia and listed on the Indonesia Stock Exchange since 7

October 2010. ICBP is one of the leading packaged food producers in Indonesia,

with a wide range of packaged food products including noodles, dairy products,

snack foods, food seasonings as well as nutrition and special foods. ICBP brands

are among the strongest brands with the most significant mindshare in Indonesia

for consumer food brands;

(b) Bogasari Group, which is primarily a producer of wheat flour and pasta. Its

business operations are supported by shipping and packaging units;

(c) Agribusiness Group, which is led by Indofood Agri Resources Ltd, a company

incorporated in Singapore and listed on the SGX-ST. Both of Indofood Agri

Resources Ltd’s two (2) operating subsidiaries, PT Salim Ivomas Pratama Tbk and

PT PP London Sumatra Indonesia Tbk, are listed on the Indonesia Stock

Exchange. The Agribusiness Group’s principal activities range from research and

development, seed breeding, oil palm cultivation and milling; as well as the

production and marketing of branded cooking oils, margarine and shortening. In

addition, the Agribusiness Group is also involved in the cultivation and processing

of rubber and sugar cane as well as other crops; and

(d) Distribution Group, which boasts the most extensive distribution network in

Indonesia. It distributes the majority of the Offeror’s consumer products as well as

third party products.

As at the Latest Practicable Date, the directors of the Offeror are (i) Mr. Anthoni Salim,

(ii) Mr. Franciscus Welirang, (iii) Mr. Tjhie Tje Fie, (iv) Mr. Darmawan Sarsito, (v) Mr.

Taufik Wiraatmadja, (vi) Mr. Moleonoto, (vii) Mr. Axton Salim, (viii) Ms. Werianty

Setiawan, and (ix) Mr. Joseph Bataona.

As at the Latest Practicable Date, the Offeror owned, controlled or had agreed to

acquire 398,042,382 Shares, representing approximately 60.73% of the total issued

Shares.

Appendix I to this Offer Document sets out certain additional information on the Offeror.”

Additional information on the Offeror is set out in Appendix I to the Offer Document.

13

5. RATIONALE FOR THE OFFER AND THE OFFEROR’S INTENTIONS FOR THE COMPANY

5.1 The full text of the rationale for the Offer and the Offeror’s Intentions for the Company has

been extracted from Sections 6 and 7 of the Offer Document, respectively, and are set out

in italics below. All terms and expressions used in the extract below shall have the same

meanings as those defined in the Offer Document, unless otherwise stated. Shareholders

are advised to read the extract below carefully.

“6. RATIONALE FOR THE OFFER

As set out in paragraph 2 of this Offer Document, the Offeror is making the Offer in

compliance with the requirements of the Code.

In addition, the Offeror considers the Company’s business to be strategically

complementary to the Offeror’s business and that various opportunities exist for

strategic integration and synergies. The Offeror believes that the Company’s financial

performance can be enhanced by the following potential initiatives:

(a) Cross-selling of existing products and supply chain integration

The Offeror has one of the most extensive distribution networks in Indonesia which

the Company can tap on for the distribution of its products in Indonesia, one of the

world’s fastest growing economy, and thus expanding the Company’s international

market presence.

By leveraging on both parties’ marketing and distribution expertise and capabilities

for consumer branded products, the Offeror and the Company can cross-distribute

each other’s products in the Chinese and Indonesian consumer markets.

Strategic integration opportunities in the areas of supply chain are also abound.

For example, the Offeror and its subsidiaries could source ingredients for its

instant noodles seasoning pack and other raw materials from the Company.

(b) Knowledge transfer

Beyond cross-selling of existing products and supply chain integration, knowledge

transfer between the Offeror and the Company also presents many possible

synergies for value creation.

With the progress and expertise gained by the Company to date in the area of

industrialised farming and backed by the resources and expertise of the Offeror in

agriculture, the technology-driven industrialised farming methods can be

transplanted and replicated in Indonesia, and possibly, in the future, to various

other markets in Asia, through joint ventures or other arrangements with suitable

partners in those markets. Such replication of the Company’s business model on

industrialised farming is expected to increase the value generated by the

Company’s industrialised farming expertise.

Other parts of the Company’s business model can also be applied to the Offeror’s

business operations in Indonesia, in particular to strengthen the Offeror’s supply

chain and expand its product portfolio.

The Company can also leverage on the Offeror’s management expertise to further

improve its operations. For example, the Offeror can aid the Company in the setup

of a distribution network in China, modelled after the Offeror’s distribution network

14

in Indonesia. The Company would then be in a position to embark on vertical

downstream integration to capture a larger share of its food and agricultural value

chain. This will also enable the Company to be in a better position to cross-

distribute the Offeror’s consumer branded products.

(c) Enhancing Company’s position to invest in future growth

The Offer is also expected to further enhance the Company’s ability to tap the debt

and equity capital markets.

Support for the Company’s future investment and expansion plans with the

Offeror’s financial backing is expected to further strengthen the Company’s

financial position and ability to invest in future growth.

(d) Value creation for the Company, the Offeror and its shareholders

The Offeror believes its acquisition of a controlling interest in the Company would

be mutually beneficial to both the Offeror and the Company and would accelerate

the Company’s growth and development by broadening the Company’s exposure

to new and existing markets.

In addition, realisation of strategic integration benefits and other synergies sought

to be achieved by the Offeror would also be beneficial for the shareholders of the

Offeror and the Company.”

“7. THE OFFEROR’S INTENTIONS FOR THE COMPANY

7.1 Following the close of the Offer, the Offeror intends to undertake a strategic and

operational review of the organisation, businesses and operations of the Group,

and to evaluate various strategic options. The Offeror also intends to appoint

executive and non-executive directors to the board of directors of the Company

after the close of the Offer. It is currently the intention of the Offeror to ensure

continuity in the operations of the Group and to steer the Group to further growth

and development.

7.2 Save as disclosed above, the Offeror has no current intention of (a) making

material changes to the existing businesses of the Company, (b) redeploying fixed

assets of the Company, or (c) discontinuing the employment of the existing

employees of the Company or the Group, other than in the ordinary course of

business. Nonetheless, the Offeror retains the flexibility to, at any time, consider

options or opportunities which may present themselves, or be required, and which

it regards to be in the interests of the Offeror and/or the Group.”

5.2 With regard to the aforesaid rationale and intentions of the Offeror, the Company would like

to highlight the following:


The Directors wish to inform Shareholders that since September 2013, the Group has

started supplying processed vegetables to the Offeror as part of its plan to expand its

distribution network. These sales are transacted on an arm’s length basis in the

ordinary and usual course of business. Given the aforesaid intention of the Offeror, it is

likely that sales to the Offeror may increase and the Company may seek a general

mandate in relation to interested persons transactions with the Offeror under Chapter

9 of the Listing Manual from Shareholders in due course.

15


The Company is in active discussion with the Offeror on the transplanting of the

Company’s farming methods to Indonesia and the parties may set up a joint venture in

Indonesia to undertake this initiative. While the discussion is at an advanced stage, no

definitive agreement has been entered into by the parties and the Company will inform

the Shareholders of any material development in due course.

5.3 The Offeror has stated in Section 7.1 of the Offer Document that it intends to appoint

executive and non-executive directors to the Board after the close of the Offer.

Prior to the announcement of the Offer, Mr Lee Edan Kietchai, a Non-Executive and

Non-Independent Director of the Company, who is due to retire at the Company’s

forthcoming annual general meeting (“AGM”) for the financial year ended 30 June 2013, has

indicated that he does not intend to seek re-election at the forthcoming AGM.

In addition, Mr Anson Wang, a Non-Executive and Non-Independent Director of the

Company, has indicated to the Company that he intends to resign from the Board at the

forthcoming AGM.

In view of the Offeror’s aforesaid intention, the Board will not be appointing new Directors to

replace the aforesaid outgoing Directors but will review the candidates proposed by the

Offeror. Subject to the approval of the Nomination Committee and the Board, the

appointment of the new Directors is expected to take effect after the date of the AGM, which

is expected to be held on 28 October 2013 after the close of the Offer.

6. THE OFFEROR’S INTENTIONS REGARDING LISTING STATUS AND COMPULSORY

ACQUISITION

The full text of the intentions of the Offeror relating to the listing status and compulsory

acquisition of the Company has been extracted from Section 9 of the Offer Document and is

set out in italics below. All terms and expressions used in the extract below shall have the

same meanings as those defined in the Offer Document, unless otherwise stated.

Shareholders are advised to read the extract below carefully.

“9. OFFEROR’S INTENTIONS REGARDING LISTING STATUS AND COMPULSORY

ACQUISITION

9.1 Listing Status

Pursuant to Rule 1105 of the Listing Manual, upon an announcement by the Offeror that

acceptances have been received pursuant to the Offer that bring the holdings owned by

the Offeror and parties acting in concert with it to above 90% of the total number of

issued Shares (excluding any Shares held by the Company as treasury shares), the

SGX-ST may suspend the listing of the Shares in the Ready and Unit Share markets

until it is satisfied that at least 10% of the total number of issued Shares (excluding any

Shares held by the Company as treasury shares) are held by at least 500 Shareholders

who are members of the public. Rule 1303(1) of the Listing Manual provides that if the

Offeror succeeds in garnering acceptances exceeding 90% of the total number of

issued Shares (excluding any Shares held by the Company as treasury shares), thus

causing the percentage of the total number of issued Shares (excluding any Shares

held by the Company as treasury shares) held in public hands to fall below 10%, the

SGX-ST will suspend trading of the Shares only at the close of the Offer.

16

Under Rule 724(1) of the Listing Manual, if the percentage of the Shares held in public

hands falls below 10%, the Company must, as soon as possible, announce that fact and

the SGX-ST may suspend trading of all the Shares. Rule 724(2) of the Listing Manual

states that the SGX-ST may allow the Company a period of three (3) months, or such

longer period as the SGX-ST may agree, to raise the percentage of the Shares held in

public hands to at least 10%, failing which the Company may be delisted.

It is the current intention of the Offeror to maintain the listing status of the Company on

the Mainboard of the SGX-ST. However, in the event that the Company does not meet

the minimum public float required under the Listing Manual at the close of the Offer, the

Offeror will re-evaluate its position in respect of its shareholdings in the Company

accordingly, depending on, inter alia, the ultimate level of acceptances received by the

Offeror and the prevailing market conditions at the relevant time.

9.2 Compulsory Acquisition

Pursuant to Section 215(1) of the Companies Act, in the event that the Offeror acquires

not less than 90% of the total number of issued Shares (other than those already held

by the Offeror, its related corporations or their respective nominees as at the date of the

Offer and excluding any Shares held by the Company as treasury shares), the Offeror

would be entitled to exercise the right to compulsorily acquire all the Shares from

Shareholders who have not accepted the Offer at a price equal to the Offer Price.

In addition, pursuant to Section 215(3) of the Companies Act, if the Offeror acquires

such number of Shares which, together with the Shares held by it, its related

corporations and their respective nominees, comprise 90% or more of the total number

of issued Shares (excluding any Shares held by the Company as treasury shares), the

Shareholders who have not accepted the Offer at a price equal to the Offer Price have

a right to require the Offeror to acquire their Shares at the Offer Price. Such

Shareholders who wish to exercise such a right are advised to seek their own

independent legal advice.

As mentioned in paragraph 3 of this Offer Document, the Undertaking Shareholders

have given the Irrevocable Undertakings. Unless the Irrevocable Undertakings are

terminated, the Offeror does not expect to have any rights of compulsory acquisition

under Section 215(1) of the Companies Act.”

7. ADVICE AND RECOMMENDATION IN RELATION TO THE OFFER

7.1 Independence of Directors

All the Directors are considered independent for the purposes of making a recommendation

to Shareholders in relation to the Offer.

7.2 PwCCF and IFA Letter

Shareholders should read and consider carefully the advice of the IFA to the Directors in

respect of the Offer as set out in the IFA Letter and the recommendation of the Directors in

their entirety before deciding whether or not to accept the Offer.

7.3 Advice of PwCCF to the Directors on the Offer

Based on PwCCF’s assessment of the financial terms of the Offer from a financial point of

view, PwCCF has advised the Directors on the terms set out in Section 9 of the IFA Letter and

reproduced in italics below. The advice set out below should be considered and read by

17

Shareholders in conjunction with, and in the context of, the full text of the IFA Letter. All terms

and expressions used in the extract below shall have the same meanings as those defined

in the IFA Letter, unless otherwise stated.

“9 CONCLUSION AND RECOMMENDATION

In arriving at our opinion, we have taken into account a range of factors which we

consider, based on available information, to be pertinent and have a significant bearing

on our assessment of the Offer. Accordingly, it is important that this IFA Letter, in

particular, all the considerations and information we have taken into account, be read

in its entirety.

The principal factors that we have taken into consideration in forming our opinion are

summarised below:

(i) Rationale for the Offer;

(ii) Offeror’s current intentions pertaining to the Company;

(iii) The premia of the Offer Price to the last transacted price on the Relevant Day,

1 month VWAP and 3 month VWAP are in line with the average premia/(discounts)

of the offer prices of Precedent Non-Privatisation Take-Overs to their respective

Last Traded Prices, 1 month VWAPs and 3 month VWAPs, while the premium of

the Offer Price to the 6 month VWAP of the Company is below the average

premia/(discounts) of the offer prices of Precedent Non-Privatisation Take-Overs

to their respective 6 month VWAPs;

(iv) The premia of the Offer Price to the last transacted price on the Relevant Day,

1 month VWAP, 3 month VWAP and 6 month VWAP of the Company are below the

average premia of the offer prices of Successful Delisting/Privatisation

Transactions to their respective Last Traded Prices, 1 month VWAPs, 3 month

VWAPs and 6 month VWAPs;

(v) The Offer Price is at a discount to the NAV of the Company as of 30 June 2012 and

30 June 2013, and is at a premium to the NAV of the Company as of 30 June 2011;

(vi) The Offer Price is at a lower discount to the unaudited NAV per Share as of

30 June 2013 vis-a-vis the discounts of the FY2013 and Financial Year-to-Date

VWCPs to the respective beginning balance of their NAVs per Share, and is at a

higher discount to the unaudited NAV per Share vis-a-vis the discount of the

FY2012 VWCP to the beginning balance of its NAV per Share;

(vii) The valuation ratios of the Company implied by the Offer Price are below the

average of the valuation ratios of the Comparable Entities as at the Offer

Document LPD;

(viii) The valuation ratios of the Company implied by the Offer Price are in line with the

valuation ratios of the non-anomalous Comparable Transactions, which are arm’s

length transactions involving the Company’s Shares in the 12 month period

preceding the Offer Announcement Date;

(ix) The valuation ratios of the Company implied by the Offer Price are in line with the

valuation ratios of the Precedent Share Issuances;

18

(x) The Offer Price is at a discount to the average of the brokers’ and research

analysts’ latest research price targets for the Company as at the Relevant Day;

(xi) The Offer Price is at a discount to the average of the brokers’ and research

analysts’ latest research price targets for the Company as at the Offer Document

LPD;

(xii) The Post-Offer Announcement distribution adjustment to the Offer Price; and

(xiii) Other significant and relevant considerations.

We have not evaluated or commented on the merits of the statements or opinions stated

in any research reports on the Company, including the Reports and any other reports

issued by any other party.

Based on the above analysis including the qualifications made therein, we are of

the opinion that, on balance, the Offer is NOT FAIR BUT REASONABLE, from a

financial point of view.

For the purposes of evaluation of the Offer, from a financial point of view, we have

adopted the convention1 that the term “fair and reasonable” has two distinct criteria:

(i) Whether an offer is “fair”, based strictly on the evaluation of the Offer Price (i.e. by

only looking at the financial analyses of the Offer Price as set out above); and

(ii) Whether an offer is “reasonable”, after taking into consideration the actual and

potential financial impact of other circumstances surrounding the Offer and the

Company which we consider relevant (being quantitative and qualitative factors).

We consider the Offer to be NOT FAIR, from a financial point of view, for the following

reasons:

(i) the Offer Price is at a discount to the unaudited NAV per Share as of 30 June 2013;

(ii) the premia of the Offer Price vis-à-vis the range of VWAPs is below those of

Successful Delisting/Privatisation Transactions;

(iii) the valuation ratios computed for the Offer Price are below the average P/E,

EV/EBITDA and P/NAV multiples as compared to the Comparable Entities; and

(iv) the Offer Price is at a discount to the average of the brokers’ and research

analysts’ latest research price targets for the Company as at the Relevant Day and

the Offer Document LPD.

However, we consider the Offer to be REASONABLE, from a financial point of view, for

the following reasons:

(i) the valuation ratios computed for the Offer Price are in line with the P/E,

EV/EBITDA and P/NAV multiples of the arm’s length transactions involving the

Company’s Shares as well as Precedent Share Issuances in the 12 months

preceding the Offer Announcement Date (commencing 3 September 2012);

1 See e.g., the convention adopted in Australian mergers and acquisitions practice, as documented in Regulatory

Guide No. 111 issued by the Australian Securities and Investments Commission (ASIC) on 30 October 2007.

19

(ii) the premia of the Offer Price to the last transacted price on the Relevant Day,


of the offer prices of Precedent Non-Privatisation Take-Overs to their respective

last traded prices, 1 month VWAPs and 3 month VWAPs;

(iii) during the period between the Offer Announcement Date and the Offer Document

LPD, the Offeror has acquired additional Shares equal to 27.24% of the aggregate

number of Shares in issue as at the Offer Document LPD at an average price

approximately equal to the Offer Price. As a result, the Offeror has acquired more

than 50% of the maximum potential issued share capital of the Company and the

Offer is unconditional. In addition, the Offer Document states that it is the current

intention of the Offeror to maintain the listing status of the Company on the Main

Board of the SGX-ST, and that the Offeror does not intend to revise the Offer Price;

(iv) the Offer Price is at a lower discount to the unaudited NAV per Share as of 30 June

2013 vis-a-vis the discounts of the FY2013 and Financial Year-to-Date VWCPs to

the respective periods’ beginning balance of their NAVs per Share;

(v) the Company has budgeted an aggregate of approximately RMB 1.67 billion of

capital expenditure in the Putian Facility, which represents 34.9% of the

Company’s unaudited NAV as of 30 June 2013. As at the Offer Document LPD,

although the Putian Facility has yet to be fully operational, the development of the

Putian Facility has been significantly completed. There is no assurance that the

Company will be able to fully realise the potential of the Putian Facility; and

(vi) Share prices experienced greater volatility in the period between publication of the

Reports and the Offer Announcement Date. Although the Company has published

its Responses and there does not appear to be any further debate between the

Company and Glaucus on the Reports and the Responses, there is a risk that

volatility in Share prices may return following the close of the Offer.

Accordingly, we advise that the Board recommend that.

(i) Shareholders who, after taking the above into consideration:

(a) wish to realise their investments in the Company at this time but are unable

to sell their Shares in the open market at a price (after deducting related

expenses) higher than the Offer Price; and/or;

(b) believe that the current market price of the Shares may not be sustained after

the close of the Offer; and/or

(c) are uncertain of the longer term performance and prospects of the Company,

either on a status quo basis or under the leadership of the Offeror and parties

acting in concert with it,

ACCEPT the Offer. Alternatively, such Shareholders should sell their Shares in the

open market if they are able to obtain a price higher than the Offer Price after

deducting related expenses (such as brokerage and trading costs).

20

(ii) Shareholders who, after taking the above into consideration:

(a) hold a favourable view and are confident of the Company’s prospects, either

on a status quo basis or under the leadership of the Offeror and parties acting

in concert with it, and believe that they will be able to realise greater value

from continuing to own their Shares; and/or

(b) do not currently wish to realise their investments in the Company; and/or

(c) believe that the market price of the Shares may be sustainable or improve

after the close of the Offer,

REJECT the Offer.”

7.4 Recommendation of the Directors

The Directors, having considered carefully the terms of the Offer and the advice given by

PwCCF to the Directors in the IFA Letter, concur with the advice and recommendation of

PwCCF in respect of the Offer. Accordingly, the Directors adopt the recommendation in

respect of the Offer as set out in Section 7.3 above.

Shareholders are advised to read the IFA Letter set out in Appendix I to this Circular and

other relevant information set out in this Circular carefully before deciding whether to accept

or reject the Offer. Shareholders should note that PwCCF’s advice to the Directors in

respect of the Offer should not be relied upon by any Shareholder as the sole basis for

deciding whether or not to accept the Offer.

Shareholders should note that trading of the Shares is subject to, inter alia, the performance

and prospects of the Company, prevailing economic conditions, economic outlook and stock

market conditions and sentiments. Accordingly, the advice by PwCCF to the Directors in

respect of the Offer does not and cannot take into account the future trading activities or

patterns or price levels that may be established beyond the Offer Document LPD.

In rendering the above advice and making the above recommendation, PwCCF and the

Directors have not had regard to any general or specific investment objectives, financial

situations, tax position, risk profiles or particular needs and constraints or other particular

circumstances of any Shareholder. As each Shareholder would have different investment

objectives and profiles, the Directors recommend that any Shareholder who may

require specific advice in relation to his specific investment objectives or portfolio

should consult his stockbroker, bank manager, solicitor, accountant, tax adviser or

other appropriate professional adviser immediately.

8. ACTION TO BE TAKEN BY SHAREHOLDERS

Shareholders may accept the Offer in respect of all or any part of their holdings of Shares.

Shareholders who wish to accept the Offer must do so not later than 5.30 p.m. (Singapore

time) on 18 October 2013. Shareholders should note that the Offeror does not intend to

extend the Offer beyond 5.30 p.m. (Singapore time) on 18 October 2013 as stated in the

Offer Document. There are different procedures for acceptance for Depositors whose

Securities Accounts are or will be credited with Shares and for Shareholders who hold

Shares which are not deposited with CDP. Shareholders who wish to accept the Offer should

take note of the “Procedures for Acceptance” set out in Appendix V to the Offer Document.

Shareholders who do not wish to accept the Offer need not take any further action in respect

of the Offer Document and the FAA and/or FAT which have been sent to them.

21

9. INFORMATION PERTAINING TO CPFIS INVESTORS

CPFIS Investors will receive further information on how to accept the Offer from their

respective CPF Agent Banks directly. CPFIS Investors are advised to consult their respective

CPF Agent Banks should they require further information, and if they are in any doubt as to

the action they should take, CPFIS Investors should seek independent professional advice.

CPFIS Investors who wish to accept the Offer are to reply to their respective CPF Agent

Banks accordingly by the deadline stated in the letter from their respective CPF Agent Banks.

CPFIS Investors who accept the Offer will receive the Offer Price payable in respect of their

Offer Shares in their CPF investment accounts.

10. OVERSEAS SHAREHOLDERS

Shareholders whose addresses are outside Singapore, as shown on the Register or, as the

case may be, in the records of CDP (each, an “Overseas Shareholder”) should refer to

Section 10 of the Offer Document, an extract of which is set out in italics below.

“10. OVERSEAS SHAREHOLDERS

The availability of the Offer to Shareholders whose mailing addresses are outside

Singapore, as maintained on the register of members of the Company or, as the case

may be, in the records of CDP (each, an “Overseas Shareholder”) may be affected by

the laws of the relevant overseas jurisdictions. Accordingly, any Overseas Shareholder

should inform himself about and observe any applicable requirements. Where there are

potential restrictions on sending this Offer Document, the FAAs and/or the FATs to any

overseas jurisdiction, the Offeror and UOBKH each reserves the right not to send these

documents to Shareholders in such overseas jurisdictions. For the avoidance of doubt,

the Offer is open to all Shareholders, including those to whom this Offer Document, the

FAAs and/or the FATs have not been, or may not be, sent.

Copies of this Offer Document and any other formal documentation relating to the Offer

are not being, and must not be, directly or indirectly, mailed or otherwise forwarded,

distributed or sent in or into or from any jurisdiction where the making of or the

acceptance of the Offer would violate the laws of that jurisdiction (a “Restricted

Jurisdiction”), and will not be capable of acceptance by any such use, instrumentality

or facility within any Restricted Jurisdiction and persons receiving such documents

(including custodians, nominees and trustees) must not mail or otherwise forward,

distribute or send them in or into or from any Restricted Jurisdiction.

The Offer (unless otherwise determined by the Offeror and permitted by applicable law

and regulation) is not being made, directly or indirectly, in or into, or by the use of mails

of, or by any means or instrumentality (including, without limitation, telephonically or

electronically) of interstate or foreign commerce of, or any facility of a national, state or

other securities exchange of, any Restricted Jurisdiction, and the Offer will not be

capable of acceptance by any such use, means, instrumentality or facilities. The Offer

may not be capable of acceptance by any Shareholder in a Restricted Jurisdiction.

Overseas Shareholders may, nonetheless, obtain copies of this Offer Document, the

FAAs and/or the FATs and any related documents, during normal business hours and up

to 5.30 p.m. (Singapore time) on the Closing Date, from the Offeror through its receiving

agent, Boardroom Corporate & Advisory Services Pte. Ltd., 50 Raffles Place, #32-01

Singapore Land Tower, Singapore 048623 or CDP at 4 Shenton Way, #02-01, SGX

Centre 2, Singapore 068807. Alternatively, an Overseas Shareholder may write to the

Offeror through Boardroom Corporate & Advisory Services Pte. Ltd. and/or CDP at the

22

addresses listed above to request for this Offer Document, the FAAs and/or the FATs

and any related documents to be sent to an address in Singapore by ordinary post at

the Overseas Shareholder’s own risk, up to five (5) Market Days prior to the Closing

Date.

It is the responsibility of any Overseas Shareholder who wishes to (a) request for this

Offer Document, the FAAs and/or the FATs and/or any related documents, or (b) accept

the Offer, to satisfy himself as to the full observance of the laws of the relevant

jurisdiction in that connection, including the obtaining of any governmental or other

consent which may be required, and compliance with all necessary formalities or legal

requirements and the payment of any taxes, imposts, duties or other requisite payments

due in such jurisdiction. Such Overseas Shareholder shall be liable for any such taxes,

imposts, duties or other requisite payments payable and the Offeror and any person

acting on its behalf (including UOBKH) shall be fully indemnified and held harmless by

such Overseas Shareholder for any such taxes, imposts, duties or other requisite

payments as the Offeror and/or any person acting on its behalf (including UOBKH) may

be required to pay. In (i) requesting for this Offer Document, the FAAs and/or the FATs

and any related documents, and/or (ii) accepting the Offer, the Overseas Shareholder

represents and warrants to the Offeror and UOBKH that he is in full observance of the

laws of the relevant jurisdiction in that connection, and that he is in full compliance with

all necessary formalities or legal requirements. Any Overseas Shareholder who is in

any doubt about his position should consult his professional adviser in the

relevant jurisdiction.

The Offeror and UOBKH each reserves the right to notify any matter, including the fact

that the Offer has been made, to any or all Overseas Shareholders by announcement

to the SGX-ST or notice and if necessary, paid advertisement in a daily newspaper

published and circulated in Singapore and in any other jurisdiction as required by

applicable laws, in which case such notice shall be deemed to have been sufficiently

given notwithstanding any failure by any Shareholder to receive or see such

announcement, notice or advertisement.”

The Articles of Association provide that Shareholders who do not have a registered address

in Singapore (as indicated on the Register or the Depository Register, as the case may be)

shall provide an address in Singapore to the Company for the service of notices and

documents by the Company. The Articles of Association further provide that a Shareholder

who has supplied an address within Singapore to the Company or CDP at which notices may

be served upon him shall be entitled to have served upon him at such address any notice to

which he is entitled to under the Articles of Association, and save for such Shareholders, no

Shareholder shall be entitled to receive any notice or other document from the Company.

Accordingly, this Circular has not been and will not be sent to any Overseas Shareholder who

has not provided, and will not provide, the Company with an address within Singapore at

which notices or documents may be served upon him. Any affected Overseas Shareholder

may nonetheless (subject to compliance with applicable laws) attend in person and obtain

copies of this Circular during normal business hours and up to 5.30 p.m. on the Closing Date,

from the office of the Registrar at 50 Raffles Place, #32-01 Singapore Land Tower, Singapore

048623. Alternatively, an Overseas Shareholder may (subject to compliance with applicable

laws) write to the Registrar at the above-stated address to request for this Circular to be sent

to an address in Singapore by ordinary post at his own risk, up to three (3) Market Days prior

to the Closing Date.

23

In requesting for this Circular and any related documents, each of the Overseas

Shareholders represents and warrants to the Company that each of them is in full

observance of the laws of the relevant jurisdiction in that connection, and that each of them

is in full compliance with all necessary formalities or legal requirements.

11. DIRECTORS’ RESPONSIBILITY STATEMENT

Save for (a) the IFA Letter, (b) information extracted in toto from the Offer Document, and (c)

information relating to the Offeror, the Directors (including those who may have delegated

detailed supervision of this Circular) collectively and individually accept full responsibility for

the accuracy of the information given in this Circular and confirm after making all reasonable

enquiries that, to the best of their knowledge and belief, this Circular constitutes full and true

disclosure of all material facts about the Group in the context of the Offer and the Directors

are not aware of any material facts the omission of which would make any statement in this

Circular misleading in any material respect.

In respect of the IFA Letter, the sole responsibility of the Directors has been to ensure that

the facts stated therein with respect to the Group are fair and accurate.

Where any information in this Circular has been extracted from the Offer Document or

published or otherwise publicly available sources or obtained from the Offeror, the sole

responsibility of the Directors has been to ensure that such information has been accurately

and correctly extracted from such sources or, as the case may be, accurately reflected or

reproduced in this Circular in its proper form and context.

Yours faithfully,

For and on behalf of the Board of Directors of

CHINA MINZHONG FOOD CORPORATION LIMITED

Lin Guo Rong

Executive Chairman and Chief Executive Officer

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APPENDIX I

LETTER FROM PwCCF TO THE DIRECTORS

4 October 2013

The Board

China Minzhong Food Corporation Limited

9 Battery Road

#15-01 Straits Trading Building

Singapore 049910

Dear Sirs

MANDATORY UNCONDITIONAL CASH OFFER FOR CHINA MINZHONG FOOD

CORPORATION LIMITED BY PT INDOFOOD SUKSES MAKMUR TBK

Unless otherwise defined in this IFA Letter or the context otherwise requires, all terms defined in

the Circular shall have the same meaning herein.

1 INTRODUCTION

This IFA Letter has been prepared for inclusion in the Circular in connection with the

mandatory unconditional cash offer (“Offer”) by UOB Kay Hian Private Limited

(“UOBKH”), for and on behalf of PT Indofood Sukses Makmur Tbk (the “Offeror”), to

acquire all the issued and paid-up ordinary shares (“Shares”) in the capital of China

Minzhong Food Corporation Limited (the “Company”), other than those Shares held by the

Company as treasury shares and those Shares owned, controlled or agreed to be

acquired, directly or indirectly, by the Offeror as at the date of the Offer (the “Offer

Shares”). This IFA Letter sets out our evaluation of the Offer, from a financial point of view,

and our advice to the Board. This IFA Letter also sets forth factors considered by

PricewaterhouseCoopers Corporate Finance Pte Ltd (“PwCCF”) in arriving at its view. The

Circular and Letter to Shareholders from the Board of Directors included therein will

provide, inter alia, details of the Offer and the recommendation(s) of the Board in relation

to the Offer, having considered PwCCF’s advice in this IFA Letter.

1.1 Background

On 2 September 2013 (the “Offer Announcement Date”), UOBKH announced (the “Offer

Announcement”), for and on behalf of the Offeror that:

(a) the Offeror had on the same day, agreed to acquire pursuant to married deals, an

aggregate of 25,590,000 issued Shares, representing approximately 3.90% of the

total number of issued Shares as at the Offer Announcement Date, at the price of

S$1.12 per Share (the “Acquisition”);

(b) following the Acquisition, the Offeror owned, controlled or had agreed to acquire an

aggregate of 219,525,382 Shares, representing approximately 33.49% of the total

number of issued Shares; and

(c) as a result of the aforesaid and in accordance with Rule 14.1 of the Singapore Code

on Take-overs and Mergers (the “Code”), the Offeror intended to make a mandatory

conditional cash offer for the Offer Shares at the Offer Price.

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Subsequent to the Offer Announcement, the Offeror acquired more Shares from the

market and on 4 September 2013, UOBKH announced, for and on behalf of the Offeror,

that pursuant to the acquisition by the Offeror on 3 September 2013 of an aggregate of

49,365,000 Shares, the Offeror and parties acting in concert with it owned, controlled or

had agreed to acquire an aggregate of 338,355,382 Shares, representing approximately

51.22% of the maximum potential issued share capital of the Company. Accordingly, it was

announced that the Offer (when made) would be unconditional in all respects.

PwCCF has been appointed to act as the independent financial adviser to the Board in

respect of the Offer.

Detailed information on the Offer is set out in Sections 1 to 10 of the Circular. We

recommend that the Board advise Shareholders to read the aforementioned

Sections carefully.

2 TERMS OF REFERENCE

We have confined our evaluation of the Offer solely from a financial point of view on the

bases set out herein. In the course of our evaluation of the Offer from a financial point of

view, we have, amongst other things:

(i) reviewed certain publicly available business and financial information concerning the

Group and the industries in which it operates, as well as certain information provided,

and representations made, to us by the Directors, senior executives, professional

advisers and other authorised representatives of the Company;

(ii) reviewed the historical trading performance of the Shares;

(iii) compared the proposed financial terms of the Offer with the publicly available

financial terms of certain transactions involving companies we deemed relevant and

the consideration received for such companies;

(iv) compared the financial and operating performance of the Company with publicly

available information concerning certain other companies we deemed relevant;

(v) participated in discussions with certain members of the management of the Company

with respect to certain aspects of the Offer and the past and current business

operations and financial conditions of the Company, and certain other matters we

believed necessary or appropriate to our inquiry;

(vi) reviewed and relied on certain internal financial analyses prepared by or at the

direction of the management of the Company relating to its business operations;

(vii) compared the financial terms of the Offer to Share price targets provided by brokers

and research analysts;

(viii) participated in discussions with representatives of the Company and its legal

advisers with respect to the Offer;

(ix) reviewed the reported prices, trading multiples and trading activity for the Shares and

the shares of certain other comparable publicly traded companies;

(x) reviewed the Offer Document and the Circular; and

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(xi) performed such other financial analyses and considered such other information as

we deemed appropriate for the purposes of this IFA Letter.

We have relied upon and assumed, inter alia, the accuracy, adequacy and completeness

of all publicly available information or information provided to or discussed with us by the

Company or otherwise reviewed by or for us. We have not independently verified such

information or its accuracy, adequacy or completeness, including the reports published by

Glaucus Research Group California, LLC (“Glaucus”) on 26 August 2013 and

2 September 2013 regarding certain affairs of the Company and its subsidiaries

(“Reports”) and the announcements by the Company dated 1 and 3 September 2013

(“Responses”) in response to the Reports. We do not represent or warrant, expressly or

impliedly, and do not accept any responsibility for the accuracy, completeness or

adequacy of such information. We have not conducted any valuation or appraisal of any

assets or liabilities, nor have we evaluated the solvency of the Company, the Group, the

Offeror or the Offeror group of companies (and parties acting in concert with them) or any

other relevant party to the Offer under any applicable laws relating to bankruptcy,

insolvency or similar matters. In relying on financial analyses provided to us or derived

therefrom, we have assumed, inter alia, that they have been reasonably prepared based

on assumptions reflecting the best currently available estimates and judgments by the

management of the Company as to the financial condition of the Company to which such

analyses relate. We express no view as to such analyses or the assumptions on which

they were based. We are not legal, regulatory or tax experts. We are the financial advisers

only and have relied on, without independent verification, the assessments made by

advisers to the Company with respect to such issues. We have nevertheless made

reasonable enquiries and exercised reasonable judgement as we deemed necessary or

appropriate in assessing such information and we are not aware of any reason to doubt

the reliability of the information.

In addition, we have assumed that the Offer will be consummated in accordance with the

terms set forth in the Offer Document without any waiver, amendment or delay of any

terms or conditions and that no conditions or restrictions will be imposed that would have

a material adverse effect on the contemplated benefits expected to be derived from the

Offer. We have further assumed, inter alia, that all material governmental, regulatory or

other consents and approvals necessary for the consummation of the Offer will be

obtained and that no delays, limitations, conditions or restrictions will be imposed that

would have any material adverse effect on the Company or on the contemplated benefits

of the Offer.

Our opinion as set out in this IFA Letter is based upon prevailing market, economic,

industry, monetary and other conditions (if applicable) and the information made available

to us as of 12 September 2013 (the “Offer Document LPD”). Developments after the Offer

Document LPD (including, without limitation, developments in connection with any claims

by Glaucus) may affect the contents of this IFA Letter and we assume no responsibility to

update, revise or reaffirm our opinion in light of any subsequent development after the

Offer Document LPD that may affect the contents of this IFA Letter. Our opinion is limited

to the fairness and reasonableness, from a financial point of view, of the Offer. We express

no opinion as to the fairness and reasonableness of the Offer to, or any consideration

received in connection therewith by, the holders of any class of securities, creditors or

other constituencies of the Company or as to the underlying decision by the Company to

engage in the Offer.

We have not been requested to, and we do not, express any opinion on the structure of

the Offer, the specific amount of the Offer Price, or any other aspects of the Offer, or to

provide services other than the delivery of this IFA Letter. We were not involved in

negotiations pertaining to the Offer nor were we involved in the deliberation leading up to

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the decision to put forth the Offer to the Shareholders. We have not been requested or

authorised to solicit, and we have not solicited, any indication of interest from any third

party with respect to the Shares or any other alternative transaction.

Our terms of reference also do not require us to evaluate or comment on the rationale for,

risks and/or merits of the Offer or the future prospects and earnings potential of the

Company, nor do our terms of reference require us to evaluate or comment on the merits

of the statements or opinions stated in any research reports on the Company, including the

Reports and any other reports issued by any other party. We have accordingly not made

such evaluation or comment. Such evaluation or comments, if any, remains the sole

responsibility of the Directors, although we may draw upon their views to the extent

deemed necessary or appropriate by us in arriving at our opinion as set out in this IFA

Letter. In addition, our terms of reference do not require us to express, and we do not

express, an opinion on the future growth prospects, earnings potential and/or financial

position of the Company. The Directors may wish to advise Shareholders to take note of

any announcement relevant to their consideration of the Offer, which may be released by

the Company after the Offer Document LPD.

The Directors have confirmed to us, after making all reasonable enquiries that, to the best

of their knowledge and belief, all material information in connection with the Company, the

Group, the Offer and the Circular has been disclosed to us, that such information

constitutes a full and true disclosure in all material respects and that there is no other

information or fact, the omission of which would cause any information disclosed to us or

the facts of or in relation to the Company as stated in the Circular to be incomplete,

inaccurate or misleading in any material respect. The Directors have jointly and severally

accepted the responsibility for the accuracy and completeness of such information. We

have relied upon such confirmation by the Directors and the accuracy and completeness

of all information given to us by the Directors and/or management of the Company and

have not independently verified such information, whether written or verbal, and

accordingly cannot and do not represent and warrant, expressly or impliedly, and do not

accept any responsibility for, the accuracy, completeness or adequacy of such information.

We have relied upon the assurances of the Directors that the Circular has been approved

by the Directors (including those who may have delegated detailed supervision of the

Circular) who collectively and individually accept full responsibility for the accuracy of the

information given in the Circular (other than this IFA Letter and information extracted in

toto from the Offer Document) and confirm after making all reasonable enquiries that, as

at the Latest Practicable Date, to the best of their knowledge and belief, the Circular

constitutes full and true disclosure of all material facts about the Group in the context of

the Offer and the Directors are not aware of any facts the omission of which would make

any statement in the Circular misleading in any material respect. For the purposes of

providing this IFA Letter and our evaluation of the Offer from a financial point of view, we

have not received or relied on any financial projections or forecasts in respect of the

Company, the Group, or any part or division of any of the foregoing.

In rendering our opinion, we have not had regard to any general or specific investment

objectives, financial situations, tax position, risk profiles, tax status or positions or

particular needs and constraints or other particular circumstances of any Shareholder and

do not assume any responsibility for, nor hold ourselves out as advisers to, any person

other than the Directors. As each Shareholder would have different investment objectives

and profiles, the Directors may wish to advise any Shareholder who may require specific

advice in relation to his specific investment portfolio to consult his stockbroker, bank

manager, solicitor, accountant, tax adviser or other appropriate professional adviser

immediately.

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This IFA Letter is addressed to the Directors and is for their benefit in connection with and

for the purpose of their consideration of the Offer. However, the recommendations made

by them shall remain the responsibility of the Directors. This IFA Letter is not addressed

to and may not be relied upon by any third party including, without limitation,

Shareholders, holders of options or awards issued by the Company, employees or

creditors of the Company. This IFA Letter does not constitute, and should not be relied on,

as advice or a recommendation to, or confer any rights or remedies upon, any Shareholder

as to how such person should deal with their Shares in relation to the Offer or any matter

related thereto.

The Company has been separately advised by its own advisers in the preparation of the

Circular (other than this IFA Letter). We have had no role or involvement and have not

provided and will not provide any advice, financial or otherwise, whatsoever in the

preparation, review and verification of the Circular (other than this IFA Letter). Accordingly,

we take no responsibility for, and express no views (express or implied) on, the contents

of the Circular (other than this IFA Letter).

Our opinion in relation to the Offer should be considered in the context of the entirety of

this IFA Letter and the Circular.

3 THE OFFER

Details of the Offer are set out in Section 2 of the Circular, which Shareholders are advised

to refer to. A summary of the key terms of the Offer, as extracted from Section 2 of the

Circular, is set out below.

3.1 Offer Terms

Based on the information set out in the Offer Document, UOBKH has, for and on behalf of

the Offeror, made the Offer to acquire all the Offer Shares on the terms and subject to the

conditions set out in the Offer Document, the FAA and the FAT, on the following basis:

The Offer is made on the following basis:

For each Offer Share: S$1.12 in cash (the “Offer Price”).

Shareholders should note that the Offeror has given notice that the Offeror does not

intend to revise the Offer Price.

The Offer Shares will be acquired (a) fully paid, (b) free from all Encumbrances, and

(c) together with all rights, benefits and entitlements attached thereto as at the Offer

Announcement Date and thereafter attaching thereto (including the right to receive and

retain all dividends, other distributions and return of capital (if any) which may be

announced, declared, paid or made thereon by the Company on or after the Offer

Announcement Date).

Without prejudice to the generality of the foregoing, the Offer Price has been determined

on the basis that the Offer Shares will be acquired with the right to receive any dividends

that may be declared, made or paid by the Company on or after the Offer Announcement

Date (including the 2013 Dividend). In the event any dividend has been paid by the

Company to a Shareholder who accepts the Offer, the Offer Price payable to such

accepting Shareholder shall be reduced by an amount which is equal to the amount of

such dividend paid by the Company to such accepting Shareholder.

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Accordingly, the following will apply if any dividend (including the 2013 Dividend) is

declared, made or paid by the Company on or after the Offer Announcement Date:

(i) if the settlement date in respect of the Offer Shares accepted pursuant to the Offer

falls on or before the books closure date for the determination of entitlements to the

dividend (“Books Closure Date”), the Offeror will pay the relevant accepting

Shareholders the Offer Price of S$1.12 in cash for each Offer Share, as the Offeror

will receive the dividend in respect of those Offer Shares from the Company; and

(ii) if the settlement date in respect of the Offer Shares accepted pursuant to the Offer

falls after the Books Closure Date, the amount of the dividend in respect of such Offer

Shares will be deducted from the Offer Price payable for such Offer Shares and the

relevant Shareholders will receive S$1.11 in cash for each Offer Share, as the Offeror

will not receive the dividend in respect of those Offer Shares from the Company.

The Offer will be extended, on the same terms and conditions, to all new Shares

unconditionally issued or to be issued pursuant to the valid exercise of any ESOS Option

to subscribe for new Shares granted under the Scheme, on or prior to the close of the

Offer.

For the purposes of the Offer, the expression “Offer Shares” shall include the aforesaid

Shares.

3.2 Unconditional Offer

The Offer is unconditional in all respects.

3.3 ESOS Options

Under the rules of the Scheme, the ESOS Options are not freely transferable by the

holders thereof. In view of this restriction, the Offeror will not make an offer to acquire the

ESOS Options. However, as stated in the Offer Document, the Offer will be extended to

all new Shares unconditionally issued or to be issued pursuant to the valid exercise on or

prior to the close of the Offer of any such ESOS Options.

As at the Latest Practicable Date, there are 5,140,000 outstanding ESOS Options granted

under the Scheme, which are held by the Undertaking Shareholders (excluding China

Minzhong Holdings Limited (“Minzhong BVI”)).

3.4 Warranty

Acceptance of the Offer will be deemed to constitute an unconditional and irrevocable

warranty by the accepting Shareholder that each Offer Share tendered in acceptance of

the Offer is sold by the accepting Shareholder, as or on behalf of the beneficial owner(s)

thereof, (a) fully paid, (b) free from all Encumbrances and (c) together with all rights,

benefits and entitlements attached thereto as at the Offer Announcement Date and

thereafter attaching thereto (including the right to receive and retain all dividends, other

distributions and return of capital (if any) which may be announced, declared, paid or

made thereon by the Company on or after the Offer Announcement Date).

3.5 Closing Date

Shareholders should note that the Offer Document states that the Offer will close at 5.30

p.m. (Singapore time) on 18 October 2013 and that the Offeror does not intend to extend

the Offer beyond 5.30 p.m. (Singapore time) on 18 October 2013. As such, notice has

been given by the Offeror that the Offer will not be open for acceptance beyond 5.30 p.m.

(Singapore time) on 18 October 2013.

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4 IRREVOCABLE UNDERTAKINGS

The information on the irrevocable undertakings received by the Offeror to accept or reject

the Offer set out in italics below has been extracted from paragraph 3 of the Offer

Document. All terms and expressions used in the extract below shall have the same


“3. IRREVOCABLE UNDERTAKINGS

3.1 Certain parties (the “Undertaking Shareholders”) have given irrevocable

undertakings (the “Irrevocable Undertakings”) in favour of the Offeror to, inter

alia, reject or procure the rejection of the Offer in respect of (a) the Offer Shares

held, directly or indirectly, or controlled by them and (b) any Offer Shares which

they may acquire (including pursuant to the valid exercise of any outstanding

ESOS Options on or prior to the close of the Offer) on or after the date of their

respective Irrevocable Undertakings.

The aggregate number of Shares under the Irrevocable Undertakings is

43,504,000 Shares, representing approximately 6.64% of the total issued Shares.

Details of the shareholdings of the Undertaking Shareholders as at the Latest

Practicable Date are as set out below:

S/No.

Undertaking

Shareholders Direct Interest Deemed Interest

Percentage of Shares

as at the

Latest Practicable

Date

No. of Shares % No. of Shares % No. of Shares %

1. Mr. Lin Guo Rong(1) 13,103,000 2.00 22,411,297 3.42 35,514,297 5.42

2. Mr. Siek Wei Ting(1) 7,989,703 1.22 22,411,297 3.42 30,401,000 4.64

3. China Minzhong

Holdings Limited(1) 22,411,297 3.42 – – 22,411,297 3.42

4. Mr. Wang Dazhang(1) – – 22,411,297 3.42 22,411,297 3.42

5. Mr. Huang Bing Hui(1) – – 22,411,297 3.42 22,411,297 3.42

Note:

(1) Minzhong BVI owns 22,411,297 Shares, representing approximately 3.42% of the total issued

Shares. Minzhong BVI is solely owned by Mr. Siek Wei Ting, the Chief Financial Officer of the

Company, who is holding the entire share capital in Minzhong BVI on trust for the following

individuals in the respective proportions:

(a) Mr. Lin Guo Rong, Executive Chairman and Chief Executive Officer of the Company:

24.12%

(b) Mr. Wang Dazhang, Chief Operations Officer of the Company: 37.94%

(c) Mr. Huang Bing Hui, Chief Technology Officer of the Company: 37.94%

3.2 Pursuant to their respective Irrevocable Undertaking, each Undertaking

Shareholder has undertaken, inter alia, the following:

(a) to reject the Offer (including any revised or improved Offer by or on behalf of

the Offeror) in respect of all the Offer Shares held, directly or indirectly, or

controlled by it (as described in paragraph 3.1 above) and any Offer Shares

which they may acquire (including pursuant to the valid exercise of any

outstanding ESOS Options on or prior to the close of the Offer) on or after the

date of their respective Irrevocable Undertakings (the “Relevant Shares”);

and

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(b) during the period commencing on the date of its Irrevocable Undertaking and

ending on the Closing Date, not to:

(i) accept any other offer for all or any of the Relevant Shares; or

(ii) directly or indirectly sell, transfer, give or otherwise dispose of (other

than with the prior written consent of the Offeror), create an

Encumbrance over or enter into any other arrangement that transfers to

another any legal, beneficial or economic consequences of ownership

of, all or any of the Relevant Shares.

The aggregate amount which would otherwise be payable by the Offeror as

consideration for the Offer Shares held by the Undertaking Shareholders shall be

referred to as the “Excluded Amount”.

3.3 Each Irrevocable Undertaking will lapse on the date on which the Offer closes,

lapses or is withdrawn, or such other date as may be extended by the mutual

written agreement of the Offeror and the relevant Undertaking Shareholder,

subject to the consent of the SIC and the requirements of the Code.”

5 INFORMATION ON THE OFFEROR

The information on the Offeror set out in italics below has been extracted from paragraph

4 of the Offer Document. All terms and expressions used in the extract below shall have

the same meanings as those defined in the Offer Document, unless otherwise stated.

Additional information on the Offeror is set out in Appendix I to the Offer Document.

“4. INFORMATION ON THE OFFEROR

The Offeror is a company incorporated in Indonesia on 14 August 1990 and is

listed on the Indonesia Stock Exchange.

Over a number of decades, the Offeror has been progressively transformed to

become a Total Food Solutions company with operations in all stages of food

manufacturing from the production of raw materials and their processing through

to consumer products in the market. Today, it is renowned as a well-established

company and a leading player in each category of business in which it operates.

In its business operation, the Offeror capitalised on its resilient business model

with four (4) complementary Strategic Business Groups, namely:

(a) Consumer Branded Products Group, which is conducted by ICBP, a company

incorporated in Indonesia and listed on the Indonesia Stock Exchange since

7 October 2012. ICBP is one of the leading packaged food producers in

Indonesia, with a wide range of packaged food products including noodles,

dairy products, snack foods, food seasonings as well as nutrition and special

foods. ICBP brands are among the strongest brands with the most significant

mindshare in Indonesia for consumer food brands;

(b) Bogasari Group, which is primarily a producer of wheat flour and pasta. Its

business operations are supported by shipping and packaging units;

(c) Agribusiness Group, which is led by Indofood Agri Resources Ltd, a company

incorporated in Singapore and listed on the SGX-ST. Both of Indofood Agri

Resources Ltd’s two (2) operating subsidiaries, PT Salim Ivomas Pratama

Tbk and PT PP London Sumatra Indonesia Tbk, are listed on the Indonesia

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Stock Exchange. The Agribusiness Group’s principal activities range from

research and development, seed breeding, oil palm cultivation and milling; as

well as the production and marketing of branded cooking oils, margarine and

shortening. In addition, the Agribusiness Group is also involved in the

cultivation and processing of rubber and sugar cane as well as other crops;

and

(d) Distribution Group, which boasts the most extensive distribution network in

Indonesia. It distributes the majority of the Offeror’s consumer products as

well as third party products.

As at the Latest Practicable Date, the directors of the Offeror are (i) Mr. Anthoni

Salim, (ii) Mr. Franciscus Welirang, (iii) Mr. Tjhie Tje Fie, (iv) Mr. Darmawan

Sarsito, (v) Mr. Taufik Wiraatmadja, (vi) Mr. Moleonoto, (vii) Mr. Axton Salim, (viii)

Ms. Werianty Setiawan, and (ix) Mr. Joseph Bataona.

As at the Latest Practicable Date, the Offeror owned, controlled or had agreed to

acquire 398,042,382 Shares, representing approximately 60.73% of the total

issued Shares.

Appendix I to this Offer Document sets out certain additional information on the

Offeror.”

6 INFORMATION ON THE COMPANY

The information on the Company set out in italics below has been extracted from

paragraph 5 of the Offer Document. All terms and expressions used in the extract below

shall have the same meanings as those defined in the Offer Document, unless otherwise

stated.

“5. INFORMATION ON THE COMPANY

Based on publicly available information, the Company is incorporated in Singapore

and listed on the Mainboard of the SGX-ST. The Company is a leading agricultural

enterprise and is headquartered in Putian City, Fujian Province, the PRC. The

Company’s operations include both processing capabilities as well as its own

cultivation bases and its portfolio comprises two (2) key business segments,

namely (a) processed vegetables and (b) fresh vegetables.

Based on information set out in the Company’s 2012 annual report, the Company’s

global customer base currently spans over 26 countries across four (4) continents.

The Group’s strategically located and geographically diversified cultivation bases

in seven (7) provinces in the PRC, as well as its network of suppliers of fresh and

semi-processed vegetables in 14 provinces throughout the country, enables the

Group to employ a seasonally complementary approach to cultivation and

leverage on favourable climatic conditions to secure fresh vegetables produce for

its processing needs throughout the year. The Company’s extensive processing

platform that encompasses processing methods such as air-drying, freeze-drying,

fresh-packing and brining allows the Group to offer more than 100 types of

processed vegetables to its customers.

Based on publicly available information, the board of directors of the Company as

at the Offer Announcement Date comprises the following:

(i) Mr. Lin Guo Rong (Executive Chairman and Chief Executive Officer);

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(ii) Mr. Lee Edan Kietchai (Non-Executive Director);

(iii) Mr. Anson Wang (Non-Executive Director);

(iv) Mr. Lim Yeow Hua @ Lim You Qin (Independent Director);

(v) Mr. Heng Hock Kiong @ Heng Hang Siong (Independent Director); and

(vi) Mr. Lim Gee Kiat (Independent Director).

Appendix II to this Offer Document sets out additional information on the Company.”

As at the Offer Document LPD, based on the results of the instant information search of

the Company dated the Offer Document LPD conducted with the Accounting and

Corporate Regulatory Authority of Singapore, the Company had a total of 655,439,000

Shares in issue and the Company did not hold any treasury shares.

7 THE OFFEROR’S INTENTIONS REGARDING LISTING STATUS AND COMPULSORY

ACQUISITION

The full text of the current intentions of the Offeror relating to the listing status and

compulsory acquisition of the Company has been extracted from paragraph 9 of the Offer

Document and is set out in italics below. All terms and expressions used in the extract

below shall have the same meanings as those defined in the Offer Document, unless

otherwise stated.

“9. THE OFFEROR’S INTENTIONS REGARDING LISTING STATUS AND

COMPULSORY ACQUISITION

9.1 Listing Status

Pursuant to Rule 1105 of the Listing Manual, upon an announcement by the

Offeror that acceptances have been received pursuant to the Offer that bring the

holdings owned by the Offeror and parties acting in concert with it to above 90%

of the total number of issued Shares (excluding any Shares held by the Company

as treasury shares), the SGX-ST may suspend the listing of the Shares in the

Ready and Unit Share markets until it is satisfied that at least 10% of the total

number of issued Shares (excluding any Shares held by the Company as treasury

shares) are held by at least 500 Shareholders who are members of the public. Rule

1303(1) of the Listing Manual provides that if the Offeror succeeds in garnering

acceptances exceeding 90% of the total number of issued Shares (excluding any

Shares held by the Company as treasury shares), thus causing the percentage of

the total number of issued Shares (excluding any Shares held by the Company as

treasury shares) held in public hands to fall below 10%, the SGX-ST will suspend

trading of the Shares only at the close of the Offer.

Under Rule 724(1) of the Listing Manual, if the percentage of the Shares held in

public hands falls below 10%, the Company must, as soon as possible, announce

that fact and the SGX-ST may suspend trading of all the Shares. Rule 724(2) of the

Listing Manual states that the SGX-ST may allow the Company a period of three

(3) months, or such longer period as the SGX-ST may agree, to raise the

percentage of the Shares held in public hands to at least 10%, failing which the

Company may be delisted.

I-10

It is the current intention of the Offeror to maintain the listing status of the

Company on the Main Board of the SGX-ST. However, in the event that the

Company does not meet the minimum public float required under the Listing

Manual at the close of the Offer, the Offeror will re-evaluate its position in respect

of its shareholdings in the Company accordingly, depending on, inter alia, the

ultimate level of acceptances received by the Offeror and the prevailing market

conditions at the relevant time.

9.2 Compulsory Acquisition

Pursuant to Section 215(1) of the Companies Act, in the event that the Offeror

acquires not less than 90% of the total number of issued Shares (other than those

already held by the Offeror, its related corporations or their respective nominees

as at the date of the Offer and excluding any Shares held by the Company as

treasury shares), the Offeror would be entitled to exercise the right to compulsorily

acquire all the Shares from Shareholders who have not accepted the Offer at a

price equal to the Offer Price.

In addition, pursuant to Section 215(3) of the Companies Act, if the Offeror

acquires such number of Shares which, together with the Shares held by it, its

related corporations and their respective nominees, comprise 90% or more of the

total number of issued Shares (excluding any Shares held by the Company as

treasury shares), the Shareholders who have not accepted the Offer at a price

equal to the Offer Price have a right to require the Offeror to acquire their Shares

at the Offer Price. Such Shareholders who wish to exercise such a right are

advised to seek their own independent legal advice.

As mentioned in paragraph 3 of this Offer Document, the Undertaking

Shareholders have given the Irrevocable Undertakings. Unless the Irrevocable

Undertakings are terminated, the Offeror does not expect to have any rights of

compulsory acquisition under Section 215(1) of the Companies Act.”

8 ASSESSMENT OF THE OFFER

In assessing the Offer, from a financial point of view, we have considered the following

factors:

(i) The rationale for the Offer;

(ii) The Offeror’s current intentions for the Company;

(iii) The historical trading performance of the Shares;

(iv) Comparison with selected non-delisting and non-privatisation take-overs of

companies listed on the SGX-ST;

(v) Comparison with selected successful delisting and privatisation transactions of

companies listed on the SGX-ST;

(vi) Comparison of the Offer Price with the Net Asset Value (“NAV”) per Share;

(vii) Comparison of the discount of the Offer Price to NAV per Share vis-à-vis the

premia/discount of the historical Volume Weighted Closing Price (“VWCP”) of the

Shares to NAV per Share;

I-11

(viii) Comparison of the implied valuation ratios of the Company to those of listed

businesses broadly comparable to the Company;

(ix) Comparison of the implied valuation ratios of the Company to the implied valuation

ratios of comparable transactions;

(x) Comparison of the implied valuation ratios of the Company to recent share issuances

and placements by the Company;

(xi) Comparison with precedent Share price targets by brokers and research analysts;

(xii) Post-Offer Announcement distribution adjustment to the Offer Price; and

(xiii) Other relevant significant considerations.

These factors are discussed in greater detail in the ensuing paragraphs.

8.1 Rationale for the Offer

The full text of the rationale for the Offer has been extracted from paragraph 6 of the Offer

Document and is set out in italics below. All terms and expressions used in the extract

below shall have the same meanings as those defined in the Offer Document, unless

otherwise stated.

“6. RATIONALE FOR THE OFFER

As set out in paragraph 2 of this Offer Document, the Offeror is making the Offer

in compliance with the requirements of the Code.

In addition, the Offeror considers the Company’s business to be strategically

complementary to the Offeror’s business and that various opportunities exist for

strategic integration and synergies. The Offeror believes that the Company’s

financial performance can be enhanced by the following potential initiatives:


The Offeror has one of the most extensive distribution networks in Indonesia which

the Company can tap on for the distribution of its products in Indonesia, one of the

world’s fastest growing economy, and thus expanding the Company’s international

market presence.

By leveraging on both parties’ marketing and distribution expertise and capabilities

for consumer branded products, the Offeror and the Company can cross-distribute

each other’s products in the Chinese and Indonesian consumer markets.

Strategic integration opportunities in the areas of supply chain are also abound.

For example, the Offeror and its subsidiaries could source ingredients for its

instant noodles seasoning pack and other raw materials from the Company.


Beyond cross-selling of existing products and supply chain integration, knowledge

transfer between the Offeror and the Company also presents many possible

synergies for value creation.

I-12

With the progress and expertise gained by the Company to date in the area of

industrialised farming and backed by the resources and expertise of the Offeror in

agriculture, the technology-driven industrialised farming methods can be

transplanted and replicated in Indonesia, and possibly, in the future, to various

other markets in Asia, through joint ventures or other arrangements with suitable

partners in those markets. Such replication of the Company’s business model on

industrialised farming is expected to increase the value generated by the

Company’s industrialised farming expertise.

Other parts of the Company’s business model can also be applied to the Offeror’s

business operations in Indonesia, in particular to strengthen the Offeror’s supply

chain and expand its product portfolio.

The Company can also leverage on the Offeror’s management expertise to further

improve its operations. For example, the Offeror can aid the Company in the setup

of a distribution network in China, modelled after the Offeror’s distribution network

in Indonesia. The Company would then be in a position to embark on vertical

downstream integration to capture a larger share of its food and agricultural value

chain. This will also enable the Company to be in a better position to cross-

distribute the Offeror’s consumer branded products.

(c) Enhancing Company’s position to invest in future growth

The Offer is also expected to further enhance the Company’s ability to tap the debt

and equity capital markets.

Support for the Company’s future investment and expansion plans with the

Offeror’s financial backing is expected to further strengthen the Company’s

financial position and ability to invest in future growth.

(d) Value creation for the Company, the Offeror and its shareholders

The Offeror believes its acquisition of a controlling interest in the Company would

be mutually beneficial to both the Offeror and the Company and would accelerate

the Company’s growth and development by broadening the Company’s exposure

to new and existing markets.

In addition, realisation of strategic integration benefits and other synergies sought

to be achieved by the Offeror would also be beneficial for the shareholders of the

Offeror and the Company.”

8.2 The Offeror’s Current Intentions for the Company

The full text of the Offeror’s current intentions for the Company has been extracted from

paragraph 7 of the Offer Document and is set out in italics below. All terms and

expressions used in the extract below shall have the same meanings as those defined in

the Offer Document, unless otherwise stated.

“7. THE OFFEROR’S INTENTIONS FOR THE COMPANY

7.1 Following the close of the Offer, the Offeror intends to undertake a strategic and

operational review of the organisation, businesses and operations of the Group,

and to evaluate various strategic options. The Offeror also intends to appoint

executive and non-executive directors to the board of directors of the Company

I-13

after the close of the Offer. It is currently the intention of the Offeror to ensure

continuity in the operations of the Group and to steer the Group to further growth

and development.

7.2 Save as disclosed above, the Offeror has no current intention of (a) making

material changes to the existing businesses of the Company, (b) redeploying fixed

assets of the Company, or (c) discontinuing the employment of the existing

employees of the Company or the Group, other than in the ordinary course of

business. Nonetheless, the Offeror retains the flexibility to, at any time, consider

options or opportunities which may present themselves, or be required, and which

it regards to be in the interests of the Offeror and/or the Group.”

8.3 Historical trading performance of the Shares

Under ordinary circumstances, the market valuation of Shares traded on a recognised

stock exchange may be affected by, inter alia, its relative liquidity, the size of its free float,

the extent of research coverage, the amount of investor interest it attracts and the general

market sentiment at a given period in time. Shareholders should also note that the past

trading performance of the Shares should not be relied upon as a guide of its future trading

performance. Therefore, this analysis serves as an illustrative guide only.

We set out below the chart showing the trend of the daily closing prices and volume traded

in the period 12 months prior to the Offer Announcement Date (commencing 3 September

2012) and ending on the Offer Document LPD.

0

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Volume Company STI Scaled

Offer Price: S$1.12

1

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11

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9

Chart 1: Daily Closing Price and Daily Traded Volume for period commencing 3 September

2012 (12-month period preceding the Offer Announcement Date) up to and including the Offer

Document LPD

(Source: Capital IQ)

A summary of the salient announcements on key corporate developments by the Company

during the period of 12 months prior to the Offer Announcement Date (commencing 3

September 2012) and ending on the Offer Announcement Date (2 September 2013) is set

out below.

I-14

Table 1: Key corporate developments by the Company during the period of 12

months prior to the Offer Announcement Date

No.

Announcement

Date Events

1 04 Sep 12 Grant of 2,678,000 ESOS Options with strike price at

S$0.74 to be vested on 4 September 2013

2 14 Nov 12 Announcement of 1Q2013 financial results

3 07 Dec 12 Disposal of 10.3% stake by Olympus Capital Holdings Asia

to a consortium of institutional funds and high net worth

investors

4 07 Feb 13 Announcement of 2Q2013 financial results

5 15 Feb 13 Announcement of a proposed subscription of 98,000,000

Shares amounting to a 14.95% stake in the Company by

the Offeror (the “Feb 2013 Share Issuance”) at S$0.915

per Share (discount of 9.93% over the Volume Weighted

Average Price (“VWAP”) of Shares of S$1.0159 for trades

done on the SGX-ST for the full market day on 14 February

2013)

6 22 Feb 13 In-principle approval by the SGX-ST of the Feb 2013 Share

Issuance

7 27 Feb 13 Completion of the Feb 2013 Share Issuance

8 01 Mar 13 Acquisition of a 14.38% stake in the Company by the

Offeror from Tetrad Ventures Pte Ltd at S$1.12 per Share

9 05 Mar 13 Additional US$44,960,000 investment in Fujian Minzhong

Organic Food Co., Ltd, a wholly-owned subsidiary of the

Company

10 08 Mar 13 Announcement of a proposed issue of senior notes due

2018

11 27 Mar 13 Additional US$19,000,000 investment in Fujian Minzhong

Organic Food Co., Ltd, a wholly-owned subsidiary of the

Company

12 13 May 13 Announcement of 3Q2013 financial results

13 26 Aug 13 Release of Reports by Glaucus – Target price: S$0.00

14 29 Aug 13 Announcement of FY2013 financial results

15 02 Sep 13 Offer Announcement

16 04 Sep 13 Unconditional Announcement

(Source: Announcements posted on the SGX-ST)

I-15

We have also compared the Offer Price to the VWAP and other trading statistics of the

Shares for selected reference periods as follows:

Table 2: Analysis of Offer Price against the VWAP of the Shares

Description

VWAP(1)

(S$)

Premium/(Discount)

over VWAP(2)

Offer Announcement Date to Offer Document

LPD

Latest transacted price per Share on 12 September

2013 (being the “Offer Document LPD”) 1.125 (0.44%)

Periods Prior to the Offer Announcement Date

Last transacted price per Share on 23 August

2013(3) (being the last full market day on which

Shares were traded prior to the Offer Announcement

Date (the “Relevant Day”)) 1.015 10.34%

Last transacted price per Share on 26 August

2013(3) (being the last market day on which Shares

were traded prior to the Offer Announcement Date) 0.530(4) 111.32%(5)

VWAP of the Shares traded on the SGX-ST for the

one (1)-month period prior to and including the

Relevant Day 1.062 5.46%


three (3)-month period prior to and including the



six (6)-month period prior to and including the



twelve (12)-month period prior to and including the


(Source: Offer Document, Bloomberg L.P.)

Notes:

(1) Based on data extracted from Bloomberg L.P.

(2) Computed based on the Share prices which were rounded to the nearest three (3) decimal places.

(3) There was an anomaly in the trading activity of the Shares following the issuance of a report regarding

certain affairs of the Company on 26 August 2013 which caused the Share price to drop from the opening

price of S$1.015 to S$0.53 at 11.15 a.m. when a trading halt in the Shares was called. Trading has

resumed at 3.30 p.m. on 2 September 2013 post the Offer Announcement Date.

(4) Last transacted price of the Shares prior to the trading halt called at 11.15 a.m. on 26 August 2013.

(5) This represents the premium of the Offer Price to the last transacted price of the Shares prior to the trading

halt called at 11.15 a.m. on 26 August 2013.

I-16

Based on the information above, we note the following:

(i) The Offer Price represents a premium of approximately 5.5%, 6.9%, 2.2% and 18.5%

respectively over the VWAP of the Shares in the aforesaid 1-month, 3-month,

6-month and 12-month periods prior to and including the Relevant Date;

(ii) The Offer Price represents a premium of approximately 10.3% to the closing price of

the Shares of S$1.015 as at the Relevant Day;

(iii) The Offer Price represents a premium of approximately 111.3% to the closing price

of the Shares of S$0.530 as at 26 August 2013, being the last market day on which

Shares were traded prior to the Offer Announcement Date; and

(iv) The Offer Price represents a discount of approximately 0.44% to the closing price of

the Shares of S$1.125 as at the Offer Document LPD.

The market price and trading volume of the Shares have shown appreciable differences

before and after the Offer Announcement Date. As such, Shareholders should note that

there is no assurance that the market price and/or trading volume of the Shares will

continue to remain at the levels prevailing as at the Offer Document LPD after the close

of the Offer. Shareholders should also note that past trading performance of the Shares

should not be relied upon as an indication of its future trading performance.

8.4 Comparison with take-overs of companies listed on the SGX-ST

We note that it is the intention of the Offeror to maintain the listing status of the Company

on the Main Board of the SGX-ST. In assessing the fairness and reasonableness of the

Offer from a financial point of view, we have compared the financial terms of the Offer with

those of:

(i) selected recent completed take-overs of companies listed on the SGX-ST which did

not result in delisting or privatisation of the companies, were announced in the

12-month period prior to the Offer Announcement Date (3 September 2012) and

which stated that the offeror’s intentions were to preserve the listing status of the

target companies (“Precedent Non-Privatisation Take-Overs”); and

(ii) selected completed delisting offers under Rules 1307 and 1309 of the Listing Manual

and selected completed privatisation transactions, whether by way of scheme of

arrangement under Section 210 of the Companies Act or a general offer under the

Code, from the period commencing 12 months before the Offer Announcement Date

(3 September 2012) to the Offer Announcement Date, where the primary intention of

the offeror was to delist the target company from the official list of the SGX-ST

(collectively referred to as the “Selected Successful Delisting/Privatisation

Transactions”).

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8.4.1 Comparison with Precedent Non-Privatisation Take-Overs of companies

listed on the SGX-ST

We wish to highlight that the list of target companies in the Precedent Non-

Privatisation Take-Overs are not directly comparable with the Company in terms of

market capitalisation, size of operations, business activities, accounting policies,

financial performance, future prospects and other relevant criteria. Each

transaction must be judged on its own commercial and financial merits.

We also wish to highlight that the list of Precedent Non-Privatisation Take-Overs

is by no means exhaustive and has been compiled based on publicly available

information as at the Offer Document LPD.

The premium (if any) that an offeror would pay in respect of any particular

take-over depends on various factors including, inter alia, the offeror’s intention

with regard to the target company, the potential synergy that the offeror can gain

from acquiring the target company, the presence of competing bids for the target

company, prevailing market conditions and sentiments, attractiveness and

profitability of the target company’s business and assets and existing and desired

level of control in the target company. Therefore, the comparison of the Offer with

the Precedent Non-Privatisation Take-Overs set out below is for illustrative

purposes only. Conclusions drawn from the comparisons made may not reflect any

perceived market valuation of the Company.

Details of the Precedent Non-Privatisation Take-Overs announced in the period

commencing 12 months before the Offer Announcement Date (3 September 2012)

to the Offer Announcement Date is set out in chronological order as follows:

Table 3: Precedent Non-Privatisation Take-Overs announced in the period commencing

12 months before the Offer Announcement Date (3 September 2012) to the Offer

Announcement Date

Date of Offer

Announcement Target Company

Offer Price

(S$)

Premium/(Discount) of

Offer Price to:(1)

Last

Traded

Price(2)

1 mth

VWAP

3 mth

VWAP

6 mth

VWAP

13-Sep-12 Fraser & Neave, Limited 9.55 12.4% 22.4% 29.0% 31.5%

25-Oct-12 YHM Group Limited(3) 0.0018 (82.0%) (75.3%) (74.3%) (70.5%)

28-Jan-13 Sinobest Technology

Holdings Ltd. 0.12 (9.2%) (25.5%) (21.8%) (11.3%)

03-Apr-13 HSR Global Limited 0.21 21.4% 21.4% 6.1% 1.4%

21-May-13 Dynamic Colours Limited 0.19 2.8% 18.8% 28.8% 30.2%

Average 6.8% 9.3% 10.5% 13.0%

Median 7.6% 20.1% 17.5% 15.8%

High 21.4% 22.4% 29.0% 31.5%

Low (9.2%) (25.5%) (21.8%) (11.3%)

02-Sep-13 Company 1.12 10.3% 5.5% 6.9% 2.2%

(Source: Shareholders’ circulars of each respective company in relation to the Precedent Non-

Privatisation Take-Overs)

I-18

For the purposes of our analysis, the “Last Traded Price” of the Shares refers to

the last transacted price per Share on the Relevant Day of S$1.015. The premium

of the Offer Price over the last transacted price per Share of S$0.53 prior to the

trading halt at 11.15 a.m. on 26 August 2013, being the last market day on which

Shares were traded prior to the Offer Announcement Date and the day that the

Reports were published by Glaucus, is 111.3%. We have based our analysis on the

last transacted price per Share on the Relevant Day as there was an anomaly in

the trading activity of the Shares on 26 August 2013 which resulted in a trading

halt.

Notes:

(1) Market premia/discount calculated relative to the closing price of the respective target

companies one (1) full trading day prior to the respective announcement dates and VWAP of the

1-month, 3-month and 6-month period prior to the respective announcement dates.

(2) Closing share price on the last trading market day prior to the announcement date.

(3) On 25 October 2012 (the “YHM Pre-conditional Offer Announcement”), Ezion Holdings

Limited (“Ezion”) announced, inter alia, that it had on the same day entered into an agreement

for the subscription of 3,200,000,000 new shares (the “Subscription”) in YHM Group Limited

(“YHM”) and would on completion of the Subscription, be required to make a mandatory cash

offer for the shares of YHM (the “YHM Offer”). On 20 December 2012, pursuant to the completion

of the Subscription, Ezion announced the mandatory conditional cash offer for shares in YHM.

The market premium in the above table was extracted from the letter of the independent financial

adviser of YHM for its offer and was computed based on the offer price of S$0.0018 and the last

transacted price of S$0.01 prior to the YHM Pre-conditional Offer Announcement. The YHM Offer

is excluded from the average and median computations as its discounts to the selected reference

periods are anomalous.


(i) The premium of the Offer Price to the last transacted price per Share on the

Relevant Day of 10.3% is within the range of the corresponding

premia/(discounts) of Precedent Non-Privatisation Take-Overs from (9.2%) to

21.4% and in line with the average of the corresponding premia/(discounts)

of Precedent Non-Privatisation Take-Overs of 6.8%;

(ii) The premium of the Offer Price to the 1 month VWAP of 5.5% is within the

range of the corresponding premia/(discounts) of Precedent Non-

Privatisation Take-Overs from (25.5%) to 22.4% and in line with the average

of the corresponding premia/(discounts) of Precedent Non-Privatisation

Take-Overs of 9.3%;

(iii) The premium of the Offer Price to the 3 month VWAP of 6.9% is within the


Privatisation Take-Overs from (21.8%) to 29.0% and in line with the average

of the corresponding premia/(discounts) of Precedent Non-Privatisation

Take-Overs of 10.5%; and

(iv) The premium of the Offer Price to the 6 month VWAP of 2.2% is within the


Privatisation Take-Overs from (11.3%) to 31.5% and below the average of the

corresponding premia/(discounts) of Precedent Non-Privatisation Take-

Overs of 13.0%.

I-19

8.4.2 Comparison with Selected Successful Delisting/Privatisation Transactions

of companies listed on the SGX-ST

A key factor guiding our selection of the Selected Successful

Delisting/Privatisation Transactions is that the offers must have resulted in a

successful privatisation and delisting of the target company, as the resulting

premium/discount would give a general indication of the relevant

premium/discount that an offeror would have to pay to delist/privatise a company

from the SGX-ST.

This analysis serves as a general indication of the relevant premium/discount that

the offerors have paid in order to acquire the acceptances level required to

delist/privatise the target companies without having regard to their specific

industry characteristics or other considerations.

We wish to highlight that the target companies set out under the Selected

Successful Delisting/Privatisation Transactions are not directly comparable to the

Company in terms of size of operations, market capitalisation, business activities,

asset base, geographical spread, track record, financial performance, operating

and financial leverage, risk profile, liquidity, future prospects and other relevant

criteria. Each of the Selected Successful Delisting/Privatisation Transactions must

be considered on its own commercial and financial merits.

We also wish to highlight that the list of Selected Successful Delisting/Privatisation

Transactions is by no means exhaustive and has been compiled based on publicly

available information as at the Offer Document LPD.

The level of premium (if any) an offeror would normally pay in any particular

delisting/privatisation transaction depends on, inter alia, factors such as potential

synergy that the offeror can gain by acquiring the target company, the significance

of the cash reserves, the trading liquidity of the target company’s shares, the

presence of competing bids for the target company, prevailing market conditions

and sentiments, attractiveness and profile of the target company’s business and

assets, size of consideration and existing and desired level of control in the target

company. Therefore, the comparison of the Offer with the Selected Successful

Delisting / Privatisation Transactions set out below is for illustrative purposes only.

Conclusions drawn from the comparisons made may not reflect any perceived

market valuation of the Company.

I-20

Details of the Selected Successful Delisting/Privatisation Transactions announced

in the period commencing 12 months before the Offer Announcement Date

(3 September 2012) to the Offer Announcement Date is set out in chronological

order as follows:

Table 4: Successful Delisting/Privatisation Transactions announced in the period

commencing 12 months before the Offer Announcement Date (3 September 2012) to the

Offer Announcement Date

Date of Offer

Announcement Target Company

Offer Price

(S$)

Premium of the Offer Price to:

Last

Traded

Price

1 mth

VWAP

3 mth

VWAP

6 mth

VWAP

23-Sep-12 Gul Technologies

Singapore Ltd 0.16 38.5%(1) 57.3% 72.3% 76.1%

15-Oct-12 Kian Ann Engineering

Ltd 0.44 46.7%(2) 60.0% 67.9% 78.1%

15-Nov-12 Asia Pacific Breweries

Ltd(3) 53.00 52.8%(4) 53.6% 55.2% 64.4%

03-Dec-12 China Farm Equipment

Limited 0.28 7.7% 2.8% 4.2% 7.9%

05-Dec-12 SC Global Developments

Ltd 1.80 49.4% 57.2% 58.0% 62.9%

14-Dec-12 Kinergy Ltd. 0.25 38.9% 37.4% 34.4% 44.5%

17-Dec-12 Rokko Holdings Ltd. 0.11 57.1% 54.9% 50.7% 44.7%

01-Feb-13 PCA Technology Limited 0.15 11.1% 1.4% 13.6% 21.0%

10-May-13 Pan Pacific Hotels

Group Limited 2.55 9.0% 8.2% 6.1% 8.1%

11-Jun-13 Tsit Wing International

Holdings Limited 0.31 36.7% 36.7% 36.2% 30.9%

21-Jun-13 Guthrie GTS Ltd 0.88 21.4% 21.9% 19.7% 20.2%

24-Jun-13 Food Junction Holdings

Limited 0.26 40.1% 37.8% 37.1% 33.5%

05-Jul-13 Viz Branz Limited 0.82 15.0% 17.9% 17.4% 17.4%

Average 32.6% 34.4% 36.4% 39.2%

Median 38.5% 37.4% 36.2% 33.5%

High 57.1% 60.0% 72.3% 78.1%

Low 7.7% 1.4% 4.2% 7.9%

02-Sep-13 Company 1.12 10.3% 5.5% 6.9% 2.2%

(Source: Shareholders’ circulars of each respective company in relation to the Selected Successful

Delisting/Privatisation Transactions)

For the purposes of our analysis, the “Last Traded Price” of the Shares refers to

the last transacted price per Share on the Relevant Day of S$1.015. The premium

of the Offer Price over the last transacted price per Share of S$0.53 prior to the

trading halt at 11.15 a.m. on 26 August 2013, being the last market day on which

Shares were traded prior to the Offer Announcement Date and the day that the

Reports were published by Glaucus, is 111.3%. We have based our analysis on the

last transacted price per Share on the Relevant Day as there was an anomaly in

the trading activity of the Shares on 26 August 2013 which resulted in a trading

halt.

I-21

Notes:

(1) On 13 September 2012, Gul Technologies Singapore Ltd (“Gul Technologies”) announced that

it was aware that a party was exploring certain corporate actions that may or may not lead to an

offer for Gul Technologies (the “Gul Holding Announcement”). On 23 September 2012, Gul

Technologies and the offeror released a joint announcement of the delisting proposal for Gul

Technologies (the “Delisting Proposal Announcement”). The market premium in the table

above was computed based on the offer price of S$0.162 and the last transacted price of

S$0.117 prior to the Gul Holding Announcement. The offer price of S$0.162 represented no

premium or discount to the last transacted price of S$0.162 prior to the Delisting Proposal

Announcement.

(2) On 17 August 2012 (the “Kian Ann Holding Announcement Date”), Kian Ann Engineering Ltd

(“Kian Ann”) announced that it had been approached by a party in relation to a possible

transaction involving the shares in the company. On 15 October 2012, Kian Ann and the offeror

jointly announced the proposed acquisition of Kian Ann by the offeror to be effected by way of

a scheme of arrangement under Section 210 of the Companies Act (the “Scheme of

Arrangement Announcement”). The market premium in the table above was computed based

on the offer price of S$0.44 and the last transacted price of S$0.30 prior to the Kian Ann Holding

Announcement Date. The offer price of S$0.44 represented a premium of 7.3% over the last

transacted price of S$0.41 prior to the Scheme of Arrangement Announcement.

(3) On 18 August 2012 (the “Heineken Pre-Conditional Offer Announcement Date”), Credit

Suisse (Singapore) Limited and Citigroup Global Markets Singapore Pte. Ltd. (collectively, the

“Heineken Financial Advisers”) announced, for and on behalf of Heineken International B.V.

(“Heineken”), that Heineken had entered into two conditional sale and purchase agreements

with Fraser and Neave, Limited (“F&NL”) for acquisition of shares (the “APB Share

Acquisition”) in Asia Pacific Breweries Limited (“APB”). On 15 November 2012 (the “Heineken

Offer Announcement Date”), the Heineken Financial Advisers announced, for and on behalf of

Heineken, the completion of the APB Share Acquisition and the mandatory unconditional offer for

the shares in APB.

(4) On 16 July 2012, APB announced that Oversea-Chinese Banking Corporation Limited (“OCBC”)

and Great Eastern Holdings Limited (“GEH”) were approached with an offer to purchase, inter

alia, their combined stakes in APB (the “OCBC and GEH Announcement”). The market premium

in the above table was computed based on the offer price of S$53.00 and the last transacted

price of S$34.69 prior to the OCBC and GEH Announcement. The offer price of S$53.00

represented a premium of 4.8% and 0.8% over the last transacted prices of S$50.57 and

S$52.60 prior to the Heineken Pre-conditional Offer Announcement Date and the Heineken Offer

Announcement Date, respectively.


(i) The premium of the Offer Price to the last transacted price per Share on the

Relevant Day of 10.3% is within the range of the corresponding premia of

Selected Successful Delisting/Privatisation Transactions from 7.7% to 57.1%

and below the average of the corresponding premia of Selected Successful

Delisting/Privatisation Transactions of 32.6%;

(ii) The premium of the Offer Price to the 1 month VWAP of 5.5% is within the range

of the corresponding premia of Selected Successful Delisting/Privatisation

Transactions from 1.4% to 60.0% and below the average of the corresponding

premia of Selected Successful Delisting/Privatisation Transactions of 34.4%;

(iii) The premium of the Offer Price to the 3 month VWAP of 6.9% is within the range



premia of Selected Successful Delisting/Privatisation Transactions of 36.4%;

and

(iv) The premium of the Offer Price to the 6 month VWAP of 2.2% is within the range



premia of Selected Successful Delisting/Privatisation Transactions of 39.2%.

I-22

8.5 Comparison of the Offer Price with the NAV per Share

In our evaluation of the Offer, we have considered whether there are any factors which

have not been otherwise disclosed in the announced financial results of the Company that

are likely to materially impact the unaudited NAV as at 30 June 2013. As at the Latest

Practicable Date, the Directors are not aware of any fact or circumstance that would

materially change the NAV per Share as at 30 June 2013.

The NAV represents the minimum value attributable to the Shareholders assuming that the

Company’s assets can be liquidated and the liabilities of the Company can be settled at

their book value. We have compared the Offer to the NAV per Share for the past three (3)

financial year ends as follows:

Table 5: Comparison of Offer Price to NAV per Share for the past three (3) financial year

ends

Offer Price

NAV per Share

as at Financial

Year Ended

30 June 2011

NAV per Share

as at Financial

Year Ended

30 June 2012

NAV per Share

as at Financial

Year Ended

30 June 2013

NAV (RMBm)(1) 2,908 3,586 4,765

Number of Shares

(millions) 557.4 557.4 655.4

NAV per Share (RMB) 5.22 6.43 7.27

Exchange Rate(2) 0.1912 0.2012 0.2047

NAV (SGDm) 556 722 975

NAV per Share (SGD) 1.00 1.30 1.49

Premium/(Discount)

over NAV 1.12 12.2% (13.5%) (24.8%)

(Source: The Company’s annual reports and Oanda)

Notes:

(1) NAV to common equity holders of the Company adjusted for options book value.

(2) Based on the exchange rates for SGD / RMB of the respective year end dates.

Based on the above, we note the following:

(i) The Offer Price implies premia/(discounts) of approximately 12.2%, (13.5%) and

(24.8%) to the NAV per Share for the financial years ended 2011, 2012 and 2013.

8.6 Comparison of the discount of the Offer Price to NAV per Share vis-à-vis the

premia/discount of the historical VWCP of the Shares to NAV per Share

In our evaluation of the Offer, we have considered the discount of the Offer Price to the

unaudited NAV per Share as at 30 June 2013 vis-à-vis the premia/discount of the historical

VWCP of the Shares to NAV per Share.

The premium/discount to NAV per Share represents the excess/shortfall in value the

market perceives to be present that is not captured in the minimum value attributable to

the Shareholders assuming that the Company’s assets can be liquidated and the liabilities

of the Company can be settled at their book value.

I-23

We have used VWCP for the purposes of our analysis instead of VWAP due to the lack of

availability of detailed historical trading information for the relevant period of our analysis.

Shareholders should also note that the past trading performance of the Shares should not

be relied upon as a guide of its future trading performance. Therefore, this analysis serves

as an illustrative guide only.

We have compared the discount of the Offer Price to the unaudited NAV per Share as at

30 June 2013 vis-à-vis the premia/discount of the historical VWCP of the Shares to NAV

per Share for the past three (3) financial year ends as follows:

Table 6: Comparison of the discount of the Offer Price to the unaudited NAV per Share as

at 30 June 2013 vis-à-vis the premia/discount of the historical VWCP of the Shares to NAV per

share.

FY2012 FY2013

Financial

Year-to-Date

as of

Relevant Day

Offer Price

vis-à-vis

30 June 2013

NAV per Share

Volume Weighted Closing

Price/Offer Price 0.93(1) 0.89(1) 1.08(2) 1.12

NAV per share (SGD),

beginning balance(3)(4) 1.00 1.30 1.49 1.49

Premium/(Discount) over NAV (7.1%) (31.0%) (27.7%) (24.8%)

(Source: Capital IQ, the Company’s annual reports and Oanda)

Notes:

(1) 12 month VWCP from 1 July 2011 to 30 June 2012 for FY2012 and 12 month VWCP from 1 July 2012 to

30 June 2013 for FY2013 respectively.

(2) Two (2) month VWCP from 1 July 2013 to 23 August 2013 for Financial Year to Date as of Relevant Day.

(3) NAV to common equity holders of the Company adjusted for options book value.

(4) Based on the exchange rates of the respective year end dates.


(i) The discount of the Offer Price to the unaudited NAV per Share as of 30 June 2013

of 24.8% is lower than the discount of the two (2) month VWCP for the Financial Year

to Date to the unaudited NAV per Share as of 30 June 2013 of 27.7%;

(ii) The discount of the Offer Price to the unaudited NAV per Share as of 30 June 2013

of 24.8% is lower than the discount of the 12 month VWCP for FY2013 to the audited

NAV per Share as of 30 June 2012 of 31.0%; and

(iii) The discount of the Offer Price to the unaudited NAV per Share as of 30 June 2013

of 24.8% is higher than the discount of the 12 month VWCP for FY2012 to the audited

NAV per Share as of 30 June 2011 of 7.1%.

I-24

8.7 Historical Multiple Analysis

As part of our evaluation of the Offer Price, we have performed historical multiple analysis

to benchmark the Offer Price to comparable traded companies and comparable

transactions using selected valuation parameters.

In our evaluation, we have considered the following widely used valuation parameters:

Table 7: Valuation parameters for historical multiple analysis

Valuation

Parameter Description

EV/EBITDA “EV” or “Enterprise Value” is the sum of a company’s market

capitalisation, minority interests, short-term and long-term debt less

cash and cash equivalents. “EBITDA” stands for historical earnings

before interest, tax, depreciation and amortization expenses. The

EV/EBITDA ratio compares the market value of a company’s business

to its pre-tax operating cash flow performance. The EV/EBITDA

multiple is an earnings-based valuation methodology. However, unlike

the P/E ratio, it does not take into account the capital structure of a

company as well as its interest, taxation, depreciation and

amortization charges.

P/E “P/E” or “price-to-earnings” ratio illustrates the ratio of the market

price of a company’s shares relative to its earnings per share. The

P/E ratio is affected by, inter alia, the capital structure of a company,

its tax position as well as its accounting policies relating to revenues

recognition, depreciation and intangible assets.

P/NAV “P/NAV” or “price-to-net asset value” ratio is the ratio of the market

capitalisation of a company relative to its net asset value. The P/NAV

ratio is affected by differences in their respective accounting policies

including their depreciation and asset valuation policies. The net

asset value of a company provide an estimate of the value of a

company assuming a hypothetical sale of all its assets and repayment

of its liabilities and obligations, as well as any minority interests, with

the balance being available for distribution to its shareholders. It is an

asset-based valuation methodology and this approach is meaningful

to the extent that it measures the value of each share that is backed

by the assets of a company.

The following paragraphs set out in detail the historical multiple analyses that we have

performed to evaluate the Offer Price.

8.7.1 Comparison of the valuation ratios of the Company implied by the Offer Price

to those of listed companies broadly comparable to the Company

For the purpose of assessing the Offer Price, we have compared the valuation

ratios of the Company implied by the Offer Price with selected publicly listed

companies that are engaged in cultivation and processing of fruits and vegetables

which we consider to be broadly comparable to the Company (the “Comparable

Entities”). We have excluded companies that are quoted on OTC markets as their

securities are generally thinly traded and their respective share prices may not be

a meaningful reflection of their value.

I-25

We, however, recognize that the Comparable Entities listed herewith are not

exhaustive and to the best of our knowledge and belief and after discussion with

the management of the Company, there are no publicly listed companies which

may be considered directly comparable to the Company in terms of composition of

business activities, scale of operations, geographical spread of activities, track

record, financial performance, future prospects, asset base, risk profile and other

relevant criteria. Accordingly, any comparisons made with respect to the

Comparable Entities can only serve as an illustrative guide.

We have only considered publicly listed companies with significant operations in

the PRC as the Company mainly operates in the PRC and is exposed to the local

market and operational risks. We consider companies that operate outside of the

PRC to have a different competitive landscape and business environment to the

Company.

A brief description of the Comparable Entities is set out below:

Table 8: Description of Comparable Entities

Company Stock Exchange Description

China Green

(Holdings)

Limited.

Hong Kong Stock

Exchange

China Green (Holdings) Limited, an investment

holding company, grows, processes, and sells

agricultural products, and consumer food and

beverage products in the PRC. The company

offers multi-grain beverage products, such as

multi-grain tea and multi-grain da wang under

the Cu Liang Wang and China Green brands;

and rice and rice related products, hot-pot

ingredients, and frozen food products under the

Cu Liang Dang Dao and Huang Jia Ma Tou

names. It also provides processed products,

such as canned products, frozen products,

pickled products, and water-boiled products; and

fresh produce. In addition, the company exports

its products. China Green (Holdings) Limited

was founded in 1998 and is headquartered in

Wanchai, Hong Kong.

Le Gaga

Holdings Limited

Nasdaq Global

Select

Le Gaga Holdings Limited engages in

cultivating, processing, and distributing

vegetables, fruits, and tea leaves in the People’s

Republic of China and Hong Kong. The company

is also involved in cultivating and selling fir trees.

It offers solanaceous vegetables, including

sweet peppers, tomatoes, eggplants, pumpkins,

and cucumbers; leafy vegetables comprising

flowering Chinese cabbage, baby bok choy, and

baby Chinese cabbage; and cruciferous

vegetables, such as broccoli and Chinese

cabbage. As of March 31, 2012, the company

operated 11 farms with an aggregate area of

1,671 hectares in Fujian, Guangdong, and Hebei

provinces. It sells approximately 50 varieties of

vegetables primarily to wholesalers, institutional

customers, and supermarket chains. The

company was founded in 2004 and is based in

Kowloon, Hong Kong.

I-26

Table 8: Description of Comparable Entities

Company Stock Exchange Description

Yamada Green

Resources

Limited

SGX-ST Main

Board

Yamada Green Resources Limited, an

investment holding company, engages in

cultivating shiitake mushrooms and black

fungus. The company operates approximately

5,134 mu shiitake mushroom cultivation bases in

Fujian Province. It sells mushrooms and black

fungus primarily to wholesalers of agricultural

food products. The company also engages in the

production and sale of processed and semi-

processed food products, which include water-

boiled/dried vegetables, such as bamboo

shoots, carrot, radish, burdock, chestnuts, and

dried shiitake mushrooms; and konjac based

dietary fiber food products, including konjac

instant noodles and konjac desserts. It

distributes processed and semi-processed food

products primarily through local supermarket

chains. In addition, Yamada Green Resources

Limited engages in forestry management

activities. It serves customers primarily in the

People’s Republic of China and Japan. The

company was incorporated in 2010 and is based

in Fuzhou, the People’s Republic of China.

Yamada Green Resources Limited is a

subsidiary of Sanwang International Holdings

Limited.

Sino Grandness

Food Industry

Group Limited

SGX-ST Main

Board

Sino Grandness Food Industry Group Limited,

an investment holding company, engages in the

production and sale of canned vegetables and

fruits in Europe, North America and Asia. The

company offers canned fruits, such as mandarin

oranges, litchis, pears, apple, pineapples, and

yellow peaches; canned asparagus, canned long

beans, water chestnut, sweet corn, and canned

mushrooms; vegetable juices; and fruit

beverages. It sells its products through a

network of distributors and retailers. Sino

Grandness Food Industry Group Limited was

founded in 1997 and is headquartered in

Shenzhen, the People’s Republic of China.

Cypress Jade

Agricultural

Holdings Limited

Hong Kong Stock

Exchange

Cypress Jade Agricultural Holdings Limited, an

investment holding company, engages in

growing, processing, and trading of agricultural

produce in Hong Kong and Mainland China. It

grows, processes, and sells vegetables. The

company was formerly known as Ever Fortune

International Holdings Limited and changed its

name to Cypress Jade Agricultural Holdings

Limited in March 2012. Cypress Jade

Agricultural Holdings Limited is based in

Kowloon, Hong Kong. Cypress Jade Agricultural

Holdings Limited is a subsidiary of Right Day

Holdings Limited.

(Source: Capital IQ)

I-27

For illustrative purposes only, the table below sets out the valuation ratios for the

Comparable Entities:

Table 9: Comparable Entities’ Valuation Ratios

Company

Enterprise

Value(1)

(S$ million)

Market

Capitalisation(1)

(S$ million) EV/EBITDA(2) P/E(2) P/NAV(3)

China Green

(Holdings) Limited(4) 329.1 132.9 3.3x 10.1x 0.2x

Le Gaga Holdings

Limited(5) 180.3 213.3 3.4x 6.4x 0.7x

Yamada Green

Resources Limited(6) 105.3 109.7 6.0x 7.2x 0.8x

Sino Grandness Food

Industry Group

Limited 397.9 355.3 4.0x 5.3x 1.5x

Cypress Jade

Agricultural Holdings

Limited(7) 68.9 59.4 NM NM 2.0x

Average(9) 4.2x 7.3x 1.0x

Median 3.7x 6.8x 0.8x

High 6.0x 10.1x 2.0x

Low 3.3x 5.3x 0.2x

Company (Implied

by Offer Price)(8) 694.8 734.1 3.2x 4.2x 0.7x

(Source: Respective companies’ financial reports and announcements, Bloomberg L.P.)

Notes:

NM: Not Meaningful

(1) Enterprise Value includes net debt, non-controlling interest, preferred equity, equity component

of convertible bonds, and intrinsic value of outstanding options per the latest filings as of the

Offer Document LPD, as well as market capitalisation as of the Offer Document LPD. Exchange

rates for conversion to S$ are sourced from Oanda as at the Offer Document LPD.

(2) EV/EBITDA and P/E are derived based on the EBITDA and diluted EPS attributable to the

common equity holders adjusted for one-off items. The respective statutory corporate income tax

rates for each of the Comparable Transactions’ target companies have been applied to compute

the tax effects of these adjustments of one-off items. EBITDA and diluted EPS are for the 12

months ending 30 June 2013, except for China Green (Holdings) Limited’s EBITDA and diluted

EPS which are for the 12 months ending 30 April 2013.

(3) NAV as of 30 June 2013 except for China Green (Holdings) Limited’s NAV, which is as of 30 April

2013. NAV is based on the book value of net assets that are attributable to common equity

holders of the company, less preferred equity, equity component of convertible bond, book value

of options and non-controlling interest.

(4) EBITDA and diluted EPS have been adjusted for one-off items including gain/loss on disposal of

property, plant and equipment (“PPE”) and fair value revaluation gain/loss from biological assets;

25.0% PRC statutory tax rate have been applied to diluted EPS adjustments.

(5) EBITDA and diluted EPS figures have been adjusted for one-off items including gain/loss on

disposal of PPE and fair value revaluation gain/loss from biological assets; 25.0% PRC statutory

tax rate applied to diluted EPS adjustments.

(6) EBITDA and diluted EPS figures have been adjusted for one-off items including gain/loss on

disposal of PPE and fair value revaluation gain/loss from biological assets; 25.0% PRC statutory


I-28

(7) EBITDA and diluted EPS figures have been adjusted for extraordinary items including

impairment of biological assets, gain from debt restructuring, gain/loss on disposal of PPE,

reversal of impairment on trade receivables, waiver of loans, and fair value revaluation gain/loss

from biological assets; 25.0% PRC statutory tax rate applied to diluted EPS adjustments.

(8) EBITDA and diluted EPS figures have been adjusted for extraordinary items including reversal

of allowance for doubtful debts and gain/loss on disposal of asset, write off of PPE, reversal of

other payables and fair value revaluation gain/loss from biological assets; 25.0% PRC statutory


(9) We note that the valuation ratios for Comparable Entities are based on minority stake

transactions amongst public shareholders, while the Offeror has launched the Offer for 100% of

the Shares of the Company. Should we consider the valuation of Comparable Entities on the

same basis as the Offer (i.e. on a 100% stake basis), we may have to impute a control premium

onto the valuation ratios of Comparable Entities.


(i) The EV/EBITDA ratio of 3.2x implied by the Offer Price is below the range of

the corresponding EV/EBITDA ratios of Comparable Entities from 3.3x to 6.0x

and is below the average EV/EBITDA ratio of the Comparable Entities of 4.2x;

(ii) The P/E ratio of 4.2x implied by the Offer Price is below the range of the

corresponding P/E ratios of Comparable Entities from 5.3x to 10.1x and is

below the average P/E ratio of the Comparable Entities of 7.3x; and

(iii) The P/NAV ratio of 0.7x implied by the Offer Price is within the range of the

corresponding P/NAV ratios of Comparable Entities from 0.2x to 2.0x and is

below the average P/NAV ratio of the Comparable Entities of 1.0x.


to the implied valuation ratios of comparable transactions

For the purpose of assessing the Offer Price, we have compared the valuation

ratios of the Company implied by the Offer Price with transactions in the last three

(3) years on selected publicly listed companies that are engaged in cultivation and

processing of fruits and vegetables which we consider to be broadly comparable

to the Company (the “Comparable Transactions”).

We, however, recognize that the Comparable Transactions listed herewith are not

exhaustive and to the best of our knowledge and belief and after discussion with

the management of the Company, there is no publicly listed companies which may

be considered directly comparable to the Company in terms of composition of

business activities, scale of operations, geographical spread of activities, track

record, financial performance, future prospects, asset base, risk profile and other

relevant criteria. Accordingly, any comparisons made with respect to the

Comparable Transactions can only serve as an illustrative guide.

As the Company mainly operates in the PRC and is exposed to the local market

and operational risks, we have considered transactions on publicly listed fruits and

vegetables cultivation and processing companies with significant operations in the

PRC. In addition, we have also considered transactions on publicly listed fruits and

vegetables cultivation and processing companies with significant operations in the

rest of Asia Pacific (excluding Japan) due to the shortage of PRC companies and

due to our belief that the market and operational risk profile of regional companies

are similar to PRC companies to a limited extent as well. We consider companies

that operate in Japan and outside of Asia Pacific to have a different competitive

landscape and business environment to the Company.

I-29

A brief description of the Comparable Transactions is as set out below:

Table 10: Description of Comparable Transactions

Company Stock Exchange Transaction Description

AgriNurture, Inc Philippines Stock

Exchange

AgriNurture, Inc. engages in trading and

exporting fresh fruits and vegetables. The

company was formerly known as Mabuhay 2000

Enterprises, Inc. and changed its name to

AgriNurture, Inc. in February 2008. AgriNurture,

Inc. was founded in 1997 and is based in

Bulacan, the Philippines.

Black River Capital Partners Fund (Food) L.P. of

the United States of America, a wholly-owned

unit of Cargill Inc’s Black River Asset

Management LLC, acquired a 28.11% stake in

AgriNurture, Inc, a Pulilan-based wholesaler of

fresh fruits and vegetables, from Chung Ming

Yang, Jaime Tiu, Yuan Kuo Jung, Ken Lai Tiu,

Ken Swan, Tiu, Ken Him Tiu and Ken Kwen Tiu,

for PHP 1.333 bil (USD30.45 mil), in a privately

negotiated transaction.

Agripure Holdings

Public Company

Limited

Thailand Stock

Exchange

Agripure Holdings Public Company Limited,

through its subsidiaries, engages in the

manufacture and distribution of agro products.

The company was founded in 1986 and is

headquartered in Pathumtanee, Thailand.

Suretphol Jeungroongruengkit acquired a

5.356% stake, or 30 mil ordinary shares, in

AgriPure Holdings Public Company Limited, a

Bangkok-based producer and wholesaler of

canned vegetables, from Komol

Jeungroongruengkit, for THB 0. 91 (USD0.031)

per share, or a total value of THB 27.3 mil

(USD0.918 mil), in a privately negotiated

transaction.

China Minzhong

Food Corporation

Limited

SGX-ST Main

Board

Indofood Sukses Makmur Tbk acquired

94,245,382 shares representing a 14.38% stake

in China Minzhong Food Corporation Limited

from Tetrad Ventures Pte Ltd, at an offer price of

S$1.12 per share (USD0.90) and valuing the

transaction at S$105.55m (USD85.24m).

China Minzhong

Food Corporation

Limited

SGX-ST Main

Board

Olympus Capital Holdings Asia sold its 10.3%

stake in China Minzhong Food Corporation

Limited to an undisclosed bidder. S$0.80

(USD0.66) per share in cash was offered to

acquire 57,231,618 shares of China Minzhong

Food Corporation Limited, valuing the deal at

S$45.785m (USD37.59m).

(Source: Mergermarket, Capital IQ)

I-30


Comparable Transactions:

Table 11: Comparable Transactions’ Valuation Ratios

Company

Implied

Enterprise

Value(1)

(S$ million)

Implied Market

Capitalisation(2)

(S$ million)

Stake

acquired

EV/

EBITDA(3) P/E(3) P/NAV(3)

AgriNurture,

Inc(4) 167.8 141.8 28.1% 37.4x(9) 68.6x(9) 2.4x(9)

Agripure

Holdings

Public

Company

Limited(5) 25.6 22.0 5.4% 40.2x(9) NM 1.4x(9)

China

Minzhong Food

Corporation

Limited(6) 765.4 734.1 14.4% 3.8x 4.9x 1.0x

China

Minzhong Food

Corporation

Limited(7) 515.2 446.0 10.3% 2.8x 3.2x 0.6x

Average 3.3x 4.1x 0.8x

Median 3.3x 4.1x 0.8x

High 3.8x 4.9x 1.0x

Low 2.8x 3.2x 0.6x

Company

(Implied by

Offer)(8) 694.8 734.1 3.2x 4.2x 0.7x

(Source: Mergermarket, ThomsonOne, Respective companies’ announcements and financial reports)

Notes:

NM: Not Meaningful

(1) Enterprise Value includes net debt, non-controlling interest, preferred equity, equity component of

convertible bonds, and intrinsic value of outstanding options as of the latest filings on the date of

acquisition, as well as implied market capitalisation(2). Exchange rates for conversion to S$ are

sourced from Oanda as at the Offer Document LPD.

(2) Implied market capitalisations of Comparable Transactions are calculated by multiplying the

Transaction Price per common share by the total amount of outstanding common shares as at

the date of the respective Comparable Transactions. For the Offer, implied market capitalisation

is computed by multiplying the Offer Price by the total amount of outstanding common shares as

at the Offer Document LPD.

(3) EV/EBITDA and P/E are derived based on the EBITDA and diluted EPS attributable to the

common equity holders adjusted for one-off items. The respective statutory corporate income tax

rates for each of the Comparable Transactions’ target companies have been applied to compute

the tax effects of these adjustments of one-off items. NAV is based on the book value of net

assets that are attributable to common equity holders of the company, less preferred equity,

equity component of convertible bond, book value of options and non-controlling interest.

I-31

(4) EBITDA and diluted EPS attributable to the common equity holders of AgriNurture, Inc. are for

the twelve months ended 30 September 2011 and have been adjusted for fair value revaluation

gain/loss from biological assets, with a 30% Philippine statutory corporate income tax rate

applied onto the adjustments to the diluted EPS. NAV is based on the financial position of the

AgriNurture, Inc. as of 30 September 2011.

(5) EBITDA and diluted EPS attributable to the common equity holders of Agripure Holdings Public

Company Limited are for the 12 months ended 30 September 2010 and have been adjusted for

impairment loss on investments, exchange gain/loss, reversal of allowance for doubtful debts

and loss on disposal of PPE, with a 20% Thailand statutory corporate income tax rate applied

onto the adjustments to the diluted EPS. NAV is based on the financial position of Agripure

Holdings Public Company Limited as of 30 September 2010.

(6) EBITDA and diluted EPS attributable to the common equity holders of the Company are for the

12 months ended 30 September 2012 and have been adjusted for reversal of allowance for

doubtful debts, write off of PPE, and fair value revaluation gain/loss from biological assets, with

a 25% PRC statutory corporate income tax rate applied onto the adjustments to the diluted EPS.

NAV is based on the financial position of the Company as of 30 September 2012.


12 months ended 31 December 2012 and have been adjusted for reversal of allowance for

doubtful debts, write off of PPE, and fair value revaluation gain/loss from biological assets, with

a 25% PRC statutory corporate income tax rate applied onto the adjustments to the diluted EPS.

NAV is based on the financial position of the Company as of 31 December 2012.


12 months ended 30 June 2013 and have been adjusted for reversal of allowance for doubtful

debts, write off of PPE, and fair value revaluation gain/loss from biological assets, with a 25%

PRC statutory corporate income tax rate applied onto the adjustments to the diluted EPS. NAV

is based on the financial position of the Company as of 30 June 2013.

(9) Outliers specifically excluded as their valuation ratios are anomalous.

(10) We note that the Comparable Transactions are minority stakes transactions while the Offeror has

launched the Offer for 100% of the Shares of the Company. Should we consider the Comparable

Transactions on the same basis as the Offer (i.e. on a 100% stake basis), we may have to impute

a control premium onto the valuation ratios of Comparable Transactions.


(i) Apart from transactions with anomalous valuation ratios, the remaining

Comparable Transactions are transactions involving the Company within the

12 month period preceding the Offer Announcement Date;

(ii) The EV/EBITDA ratio of 3.2x implied by the Offer Price is within the range of

the corresponding EV/EBITDA ratios of Comparable Transactions from 2.8x

to 3.8x and is in line with the average EV/EBITDA ratio of the Comparable

Transactions of 3.3x;

(iii) The P/E ratio of 4.2x implied by the Offer Price is within the range of the

corresponding P/E ratios of Comparable Transactions from 3.2x to 4.9x and

is in line with the average P/E ratio of the Comparable Transactions of 4.1x;

and

(iv) The P/NAV ratio of 0.7x implied by the Offer Price is within the range of the

corresponding P/NAV ratios of Comparable Transactions from 0.6x to 1.0x

and is in line with the average P/NAV ratio of the Comparable Transactions

of 0.8x.

I-32


to recent share issuances/share placements of the Company

For purposes of assessing the Offer Price, we have compared the valuation ratios

of the Company implied by the Offer Price with recent share issuances and share

placements of the Company (“Precedent Share Issuances”) in the 12-month

period leading to the Offer Announcement Date commencing 3 September 2012.

We, however, recognize that the relevant market conditions and transaction

contexts during the respective Precedent Share Issuances may be different to that

of the Offer. Accordingly, any comparisons made with respect to the Precedent

Share Issuances can only serve as an illustrative guide.


Precedent Share Issuances:

Table 12: Precedent Share Issuances’ valuation ratios in the 12-month period leading to the

Offer Announcement Date commencing 3 September 2012.

Company

Implied

Enterprise

Value(1)

(S$ million)

Implied Market

Capitalisation

(S$ million)(2) EV/EBITDA P/E P/NAV

China

Minzhong

Food

Corporation

Limited(3) 631.0 599.7 3.2x(3) 4.0x(3) 0.8x(3)

Company

(Implied by

Offer) 694.8 734.1 3.2x 4.2x 0.7x

(Source: The Company’s announcements and financial reports, Oanda)

Notes:

(1) Enterprise Value includes net debt, non-controlling interest, preferred equity, equity component

of convertible bonds, and intrinsic value of outstanding options as of the latest filings on the date

of acquisition, as well as the respective market capitalisation implied by the Precedent Share

Issuances/Offer. Exchange rates for conversion to S$ are sourced from Oanda as at the Offer

Document LPD.

(2) For the Precedent Share Issuance, implied market capitalisation is computed by multiplying the

Share Issuance Price by the total amount of outstanding common shares post Share Issuance.

For the Offer, implied market capitalisation is computed by multiplying the Offer Price by the total

amount of Shares as at the Offer Document LPD.

(3) Pertains to the Feb 2013 Share Issuance by the Company of a 14.95% equity stake (post

money). EV/EBITDA and P/E are derived based on EBITDA and diluted EPS of the Company for

the 12 months ended 31 December 2012. EBITDA and net income figures have been adjusted

for non-recurring items such as reversal of allowance for doubtful debts, write off of PPE and fair

value revaluation gain/loss from biological assets. The statutory corporate income tax rate of

25.0% for the PRC has been applied to the diluted EPS adjustments. NAV is based on the

financial position of the Company as of 31 December 2012.

(4) We note that the Precedent Share Issuance is for a minority stake in the Company, while the

Offeror has launched the Offer for 100% of the Shares of the Company. Should we consider the

Comparable Transactions on the same basis as the Offer (i.e. on a 100% stake basis), we may

have to impute a control premium onto the valuation ratios of the Precedent Share Issuance.


(i) The EV/EBITDA ratio of 3.2x implied by the Offer Price is in line with the

EV/EBITDA ratio of the Precedent Share Issuance of 3.2x;

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(ii) The P/E ratio of 4.2x implied by the Offer Price is in line with the P/E ratio of

the Precedent Share Issuance of 4.0x; and

(iii) The P/NAV ratio of 0.7x implied by the Offer Price is in line with the P/NAV

ratio of the Precedent Share Issuance of 0.8x.

8.8 Comparison of Offer Price to precedent Share price targets by brokers and research

analysts

We have reviewed certain research reports by stock brokers and research analysts in

relation to the Shares and/or the Offer as compiled from Bloomberg L.P. and Thomson

Research.

We wish to highlight that the above broker research reports are not exhaustive and the

estimated price targets for the Shares and other statements/opinions in these reports

represent the individual views of the respective brokers (and not PwCCF) based on the

circumstances (including inter alia, market, economic, industry and monetary conditions

as well as market sentiment and investor perceptions regarding the future prospects of the

Company) prevailing at the date of the publication of the respective broker research

reports. The opinions of the brokers may change over time as a result of, among other

things, changes in market conditions, the Company’s corporate developments and the

emergence of new information relevant to the Company. As such, the estimated price

targets in these broker research reports may not be an accurate prediction of future

market prices of the Shares. Therefore, the comparison of the Offer Price to precedent

Share price targets by brokers and research analysts set out below is for illustrative

purposes only.

The table below summarises the key points of various research notes and reports:

Table 13: Brokers’ and research analysts’ Share price targets for the Company

Target price as at: Relevant Day(1) Offer Document LPD

Broker Analyst

Date

(2013) Rating

Target price

(S$)

Date

(2013) Rating

Target price

(S$)

Macquarie Jake

Lynch

31 May Outperform 2.00 02 Sep Buy 1.50

Maybank

Kim Eng

Wei Bin 25 Aug Buy 1.36 03 Sep Under

Review

N/A

CIMB Kenneth

Ng

21 Jun Outperform 1.27 28 Aug N/A(2) N/A(2)

Standard

Chartered

Pauline

Lee

20 Feb Outperform 1.56 03 Sep In-line 1.14

Glaucus N/A N/A N/A N/A 26 Aug Strong

Sell

0.00(3)

Average 1.55 1.32

Median 1.46 1.32

High 2.00 1.50

Low 1.27 1.14

Offer Price 1.12 1.12

Percentage Premium/(Discount)

to average price target (27.6%) (15.2%)

(Source: Bloomberg L.P., Thomson Research)

I-34

Notes:

N/A: Not Available

(1) EVA Dimensions’ and Lim & Tan’s broker reports were not included in the list as they did not provide a

target price. JP Morgan and DBS Vickers were not included in the list as their last broker reports that

provided a target price were issued in 27 August 2012 and 11 July 2012 respectively.

(2) CIMB’s ceasing coverage report in 28 August 2013 did not include a price target.

(3) We have excluded Glaucus’s price target from the computations as we note that they have disclosed their

short selling interest in the Company and hence it is difficult to determine the objectivity of their price

target. In addition, issues raised in the Reports are currently disputed by the Company and hence the

veracity of the Reports cannot be determined yet.


(i) The Offer Price represents a discount of (27.6%) to the average latest price target

estimates by brokers and research analysts as of the Relevant Day; and

(ii) The Offer Price represents a discount of (15.2%) to the average latest price target

estimates by brokers and research analysts as of the Offer Document LPD.

8.9 Post-Offer Announcement distribution adjustment to the Offer Price

It is noted that the Offer Price has been determined on the basis that the Offer Shares will

be acquired with the right to receive any dividends that may be declared, made or paid by

Company on or after the Offer Announcement Date (including the 2013 Dividend as per the

announcement of the FY2013 financial results). In the event any dividend has been paid

by the Company to a Shareholder who accepts the Offer, the Offer Price payable to such

accepting Shareholder shall be reduced by an amount which is equal to the amount of

such dividend paid by the Company to such accepting Shareholder.

8.10 Other Considerations

8.10.1 Volatility in Share prices caused by Reports published by Glaucus

The information on the Reports and the Responses set out in italics below has

been extracted from Section 6.3 of Appendix II of the Circular:

“Glaucus Research Group California, LLC (“Glaucus”) had on 26 August 2013 and

2 September 2013 published reports (“Reports”) regarding certain affairs of the

Group. Their initial report on 26 August 2013 had caused a substantial decrease

in the share price of the Company. Glaucus had openly stated that they were short

sellers and their intention was to profit from the decline of the Company’s stock

price.

The Company had in its responses dated 1 and 3 September 2013 (“Responses”)

refuted the allegations by Glaucus and was of the view that the opinions and

inferences drawn by Glaucus were reckless and done without due regard to the

accuracy of such statements. The Responses to the Reports are available on the

website of the SGX-ST at www.sgx.com. The Company is consulting its legal

advisers on possible recourse and may take legal action to defend its rights and

reputation.”

I-35

Share prices experienced greater volatility in the period between publication of the

Reports and the Offer Announcement Date. Although the Company has published

its Responses and there does not appear to be any further debate between the



8.10.2 Putian New Industrial Park

The Company had on 27 December 2011, announced the official opening of Phase

1 of the Putian New Industrial Park processing facilities project (the “Putian

Facility”). The Putian Facility, when completed, is anticipated to have a

processing capacity that is approximately triple of that of the Group’s processing

facilities in Putian. We understand that the Company has invested an aggregate of

approximately RMB1.44 billion over the last three (3) financial years in the Putian

Facility. The total project cost is budgeted to be RMB1.67 billion, which represents

approximately 34.9% of the Company’s unaudited NAV as of 30 June 2013. As at

the Offer Document LPD, we understand that although the Putian Facility has yet

to be fully operational, the development of the Putian Facility has been

significantly completed.

We wish to highlight that there is no assurance that the Company will be able to

fully realize the potential of the Putian Facility.

8.10.3 Market Reception to Offer Price

We note from the Offer Document that for the period between the Offer

Announcement Date and the Offer Document LPD, the Offeror has acquired

additional Shares equal to 27.24% of the aggregate number of Shares in issue as

at the Offer Document LPD at an average price approximately equal to the Offer

Price. Hence, as of the Offer Document LPD, the Offeror and parties acting in

concert with it own, control or have agreed to acquire 60.73% of the Company’s

total issued Shares and the Offer is unconditional. In addition, the Offer Document

states that the Offeror does not intend to revise the Offer Price.

8.10.4 Alternative Offer from Third Parties

The Directors have informed PwCCF that as at the Latest Practicable Date, the

Directors and the Company have neither been approached with nor solicited for a

higher competing offer or an enhancement or revision of the Offer. As the Offer is

unconditional in all respects, and the Offeror and parties acting in concert with it

own, control or have agreed to acquire 60.73% of the Company’s total issued

Shares as of the Offer Document LPD, the Offeror would upon the close of the

Offer have a decisive influence on the result of, and may deter, a take-over offer

by a third party for the Company.

8.10.5 Compulsory Acquisition

Pursuant to Section 215(1) of the Companies Act, in the event that the Offeror

acquires not less than 90% of the total Shares (other than those already held by

the Offeror, its related corporations or their respective nominees as at the date of

the Offer and excluding any Shares held by the Company as treasury shares), the

Offeror will be entitled to exercise the right to compulsorily acquire all the Shares

from Shareholders who have not accepted the Offer at a price equal to the Offer

Price.

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In addition, pursuant to Section 215(3) of the Companies Act, if the Offeror

acquires such number of Shares which, together with the Shares held by it, its

related corporations and their respective nominees, comprise 90% or more of the

total Shares (excluding any Shares held by the Company as treasury shares), the

Shareholders who have not accepted the Offer have a right to require the Offeror

to acquire their Shares at the Offer Price. The Board may wish to advise

Shareholders who wish to exercise such a right that they are advised to seek their

own independent professional advice.

As stated in the Offer Document, it is the intention of the Offeror to maintain the

listing status of the Company on the Main Board of the SGX-ST. However, in the

event that the Company does not meet the minimum public float required under the

Listing Manual at the close of the Offer, the Offeror reserves its right to re-evaluate

its position, including its right of compulsory acquisition (if applicable) as described

in the preceding two paragraphs depending on, inter alia, the ultimate level of

acceptances received by the Offeror and the prevailing market conditions at the

relevant time.

8.10.6 Control of the Company

As the Offer is unconditional in all respects, the Offeror and parties acting in

concert with it will be in a position to significantly influence, inter alia, the

management, operating and financial policies of the Company and would gain

statutory control of the Company which entitles them to pass all ordinary

resolutions on matters, in which the Offeror and parties acting in concert with it do

not have an interest, at general meetings of Shareholders.

Shareholders should also note that the increase in the Offeror’s shareholding in

the Company may reduce the liquidity of the Shares in the market which may in

turn have a negative impact on the Share price.

8.10.7 Irrevocable Undertakings

As set out in paragraph 4 of this IFA Letter, pursuant to their respective Irrevocable

Undertakings, each Undertaking Shareholder has undertaken, inter alia, the

following:

(i) to reject the Offer (including any revised or improved Offer by or on behalf of

the Offeror) in respect of all the Offer Shares held, directly or indirectly, or

controlled by it (as described in paragraph 3.1 of the Offer Document) and

any Offer Shares which they may acquire (including pursuant to the valid

exercise of any outstanding ESOS Options on or prior to the close of the

Offer) on or after the date of their respective Irrevocable Undertakings (the

“Relevant Shares”); and

(ii) during the period commencing on the date of its Irrevocable Undertaking and

ending on the closing date of the Offer, not to:

(a) accept any other offer for all or any of the Relevant Shares; or

(b) directly or indirectly sell, transfer, give or otherwise dispose of (other

than with the prior written consent of the Offeror), create an

Encumbrance over or enter into any other arrangement that transfers to

another any legal, beneficial or economic consequences of ownership

of, all or any of the Relevant Shares.

I-37

We would like to highlight that the Undertaking Shareholders consist of key officers

of the Company such as Mr Lin Guo Rong, Mr Siek Wei Ting, Mr Wang Dazhang

and Mr Huang Bing Hui and Minzhong BVI, which is owned by Mr Siek Wei Ting

in trust of Mr Ling Guo Rong, Mr Wang Dazhang and Mr Huang Bing Hui.

8.10.8 Material Litigation

The Directors have confirmed that as at the Latest Practicable Date, none of the

Company or its subsidiaries is engaged in any material litigation, either as plaintiff

or defendant, which might materially and adversely affect the financial position of

the Company or the Company and its subsidiaries, taken as a whole, and the

Directors are not aware of any litigation, claims or proceedings pending or

threatened against the Company or any of its subsidiaries or any facts likely to give

rise to any litigation, claims or proceedings which might materially and adversely

affect the financial position of the Company or the Group, taken as a whole.

8.10.9 Board Restructuring

The paragraphs set out in italics below have been extracted from Section 5.3 of the

Circular:

“The Offeror has stated in Section 7.1 of the Offer Document that it intends to

appoint executive and non-executive directors to the Board after the close of the

Offer.

Prior to the announcement of the Offer, Mr Lee Edan Kietchai, a Non-Executive

Director and Non-Independent Director of the Company, who is due to retire at the

Company’s forthcoming annual general meeting (“AGM”) for the financial year

ended 30 June 2013, has indicated that he does not intend to seek re-election at

the forthcoming AGM.

In addition, Mr Anson Wang, a Non-Executive and Non-Independent Director of

the Company, has indicated to the Company that he intends to resign from the

Board at the forthcoming AGM.

In view of the Offeror’s aforesaid intention, the Board will not be appointing new

Directors to replace the aforesaid outgoing Directors but will review the candidates

proposed by the Offeror. Subject to the approval of the Nomination Committee and

the Board, the appointment of the new Directors is expected to take effect after the

date of the AGM, which is expected to be held on 28 October 2013 after the close

of the Offer.”

9 CONCLUSION AND RECOMMENDATION

In arriving at our opinion, we have taken into account a range of factors which we consider,

based on available information, to be pertinent and have a significant bearing on our

assessment of the Offer. Accordingly, it is important that this IFA Letter, in particular, all the

considerations and information we have taken into account, be read in its entirety.

The principal factors that we have taken into consideration in forming our opinion are

summarised below:

(i) Rationale for the Offer;

(ii) Offeror’s current intentions pertaining to the Company;

I-38

(iii) The premia of the Offer Price to the last transacted price on the Relevant Day,


of the offer prices of Precedent Non-Privatisation Take-Overs to their respective Last

Traded Prices, 1 month VWAPs and 3 month VWAPs, while the premium of the Offer

Price to the 6 month VWAP of the Company is below the average premia/(discounts)

of the offer prices of Precedent Non-Privatisation Take-Overs to their respective 6

month VWAPs;

(iv) The premia of the Offer Price to the last transacted price on the Relevant Day, 1

month VWAP, 3 month VWAP and 6 month VWAP of the Company are below the

average premia of the offer prices of Successful Delisting/Privatisation Transactions

to their respective Last Traded Prices, 1 month VWAPs, 3 month VWAPs and 6

month VWAPs;

(v) The Offer Price is at a discount to the NAV of the Company as of 30 June 2012 and

30 June 2013, and is at a premium to the NAV of the Company as of 30 June 2011;

(vi) The Offer Price is at a lower discount to the unaudited NAV per Share as of 30 June

2013 vis-a-vis the discounts of the FY2013 and Financial Year-to-Date VWCPs to the

respective beginning balance of their NAVs per Share, and is at a higher discount to

the unaudited NAV per Share vis-a-vis the discount of the FY2012 VWCP to the

beginning balance of its NAV per Share;

(vii) The valuation ratios of the Company implied by the Offer Price are below the average

of the valuation ratios of the Comparable Entities as at the Offer Document LPD;

(viii) The valuation ratios of the Company implied by the Offer Price are in line with the

valuation ratios of the non-anomalous Comparable Transactions, which are arm’s

length transactions involving the Company’s Shares in the 12 month period

preceding the Offer Announcement Date;

(ix) The valuation ratios of the Company implied by the Offer Price are in line with the

valuation ratios of the Precedent Share Issuances;

(x) The Offer Price is at a discount to the average of the brokers’ and research analysts’

latest research price targets for the Company as at the Relevant Day;

(xi) The Offer Price is at a discount to the average of the brokers’ and research analysts’

latest research price targets for the Company as at the Offer Document LPD;

(xii) The Post-Offer Announcement distribution adjustment to the Offer Price; and

(xiii) Other significant and relevant considerations.

We have not evaluated or commented on the merits of the statements or opinions stated

in any research reports on the Company, including the Reports and any other reports

issued by any other party.

Based on the above analysis including the qualifications made therein, we are of the

opinion that, on balance, the Offer is NOT FAIR BUT REASONABLE, from a financial

point of view.

I-39

For the purposes of evaluation of the Offer, from a financial point of view, we have adopted

the convention1 that the term “fair and reasonable” has two distinct criteria:

(i) Whether an offer is “fair”, based strictly on the evaluation of the Offer Price (i.e. by

only looking at the financial analyses of the Offer Price as set out above); and

(ii) Whether an offer is “reasonable”, after taking into consideration the actual and

potential financial impact of other circumstances surrounding the Offer and the

Company which we consider relevant (being quantitative and qualitative factors).

We consider the Offer to be NOT FAIR, from a financial point of view, for the following

reasons:

(i) the Offer Price is at a discount to the unaudited NAV per Share as of 30 June 2013;

(ii) the premia of the Offer Price vis-à-vis the range of VWAPs is below those of

Successful Delisting/Privatisation Transactions;

(iii) the valuation ratios computed for the Offer Price are below the average P/E,

EV/EBITDA and P/NAV multiples as compared to the Comparable Entities; and

(iv) the Offer Price is at a discount to the average of the brokers’ and research analysts’

latest research price targets for the Company as at the Relevant Day and the Offer

Document LPD.

However, we consider the Offer to be REASONABLE, from a financial point of view, for the

following reasons:

(i) the valuation ratios computed for the Offer Price are in line with the P/E, EV/EBITDA

and P/NAV multiples of the arm’s length transactions involving the Company’s

Shares as well as Precedent Share Issuances in the 12 months preceding the Offer

Announcement Date (commencing 3 September 2012);

(ii) the premia of the Offer Price to the last transacted price on the Relevant Day, 1

month VWAP and 3 month VWAP are in line with the average premia/(discounts) of

the offer prices of Precedent Non-Privatisation Take-Overs to their respective last

traded prices, 1 month VWAPs and 3 month VWAPs;

(iii) during the period between the Offer Announcement Date and the Offer Document

LPD, the Offeror has acquired additional Shares equal to 27.24% of the aggregate

number of Shares in issue as at the Offer Document LPD at an average price

approximately equal to the Offer Price. As a result, the Offeror has acquired more

than 50% of the maximum potential issued share capital of the Company and the

Offer is unconditional. In addition, the Offer Document states it is the current intention

of the Offeror to maintain the listing status of the Company on the Main Board of the

SGX-ST, and that the Offeror does not intend to revise the Offer Price;

(iv) the Offer Price is at a lower discount to the unaudited NAV per Share as of 30 June

2013 vis-a-vis the discounts of the FY2013 and Financial Year-to-Date VWCPs to the

respective periods’ beginning balance of their NAVs per Share;

1 See e.g., the convention adopted in Australian mergers and acquisitions practice, as documented in Regulatory

Guide No. 111 issued by the Australian Securities and Investments Commission (ASIC) on 30 October 2007.

I-40

(v) the Company has budgeted an aggregate of approximately RMB1.67 billion of capital

expenditure in the Putian Facility, which represents 34.9% of the Company’s

unaudited NAV as of 30 June 2013. As at the Offer Document LPD, although the

Putian Facility has yet to be fully operational, the development of the Putian Facility

has been significantly completed. There is no assurance that the Company will be

able to fully realise the potential of the Putian Facility; and

(vi) Share prices experienced greater volatility in the period between publication of the

Reports and the Offer Announcement Date. Although the Company has published its

Responses and there does not appear to be any further debate between the



Accordingly, we advise that the Board recommend that:

(i) Shareholders who, after taking the above into consideration:

(a) wish to realise their investments in the Company at this time but are unable to

sell their Shares in the open market at a price (after deducting related

expenses) higher than the Offer Price; and/or;

(b) believe that the current market price of the Shares may not be sustained after

the close of the Offer; and/or

(c) are uncertain of the longer term performance and prospects of the Company,

either on a status quo basis or under the leadership of the Offeror and parties

acting in concert with it,

ACCEPT the Offer. Alternatively, such Shareholders should sell their Shares in the open

market if they are able to obtain a price higher than the Offer Price after deducting related

expenses (such as brokerage and trading costs).

(ii) Shareholders who, after taking the above into consideration:

(a) hold a favourable view and are confident of the Company’s prospects, either on

a status quo basis or under the leadership of the Offeror and parties acting in

concert with it, and believe that they will be able to realise greater value from

continuing to own their Shares; and/or

(b) do not currently wish to realise their investments in the Company; and/or

(c) believe that the market price of the Shares may be sustainable or improve after

the close of the Offer,

REJECT the Offer.

In rendering our opinion, we have not taken into consideration the specific investment

objectives, financial situation, tax position or particular needs and constraints of any

individual Shareholder. As each Shareholder would have different objectives and profiles,

we recommend that any individual Shareholder who may require specific advice in relation

to his/her investment objectives or portfolio should consult his/her stockbroker, bank

manager, solicitor, accountant, tax adviser or other professional adviser immediately.

I-41

Shareholders should note that trading of the Shares is subject to, inter alia, the

performance and prospects of the Company, prevailing economic conditions, economic

outlook and stock market conditions and sentiments. Accordingly, save as highlighted

above in this IFA Letter, our advice on the Offer does not and cannot take into account the

future trading activities or patterns or price levels that may be established beyond the

Offer Document LPD.

This IFA Letter is addressed to the Board for its benefit in connection with and for the

purpose of its consideration of the Offer. The recommendation made by the Board to the

Shareholders in relation to the Offer remains the responsibility of the Board. This IFA

Letter is not addressed to and may not be relied upon by any third party including, without

limitation, Shareholders, holders of options or awards issued by the Company, employees

or creditors of the Company. This IFA Letter does not constitute, and should not be relied

on, as advice or a recommendation to, or confer any rights or remedies upon, any

Shareholder as to how such person should deal with their Shares in relation to the Offer

or any matter related thereto. Nothing herein shall confer or be deemed or is intended to

confer, any right or benefit to any third party and the Contracts (Rights of Third Parties)

Act, Chapter 53B of Singapore shall not apply.

Whilst a copy of this IFA Letter may be reproduced in the Circular, neither the Company

nor the Board may reproduce, disseminate or quote this IFA Letter (or any part thereof) for

any other purpose at any time and in any manner without the prior written consent of

PwCCF in each specific case.

This IFA Letter is governed by, and construed in accordance with, the laws of Singapore,

and is strictly limited to the matters stated herein and does not apply by implication to any

other matter.

Yours truly,

For and on behalf of

PricewaterhouseCoopers Corporate Finance Pte Ltd

Kan Yut Keong

Managing Director

I-42

APPENDIX II

ADDITIONAL GENERAL INFORMATION

1. DIRECTORS

The names, addresses and designations of the Directors as at the Latest Practicable Date

are set out below:

Name Address Designation

Mr Lin Guo Rong 9 Battery Road,

#15-01 Straits Trading

Building,

Singapore 049910

Executive Chairman and

Chief Executive Officer

Mr Lee Edan Kietchai Flat 501, Block C,

4/F, 10 Guildford Road,

Hong Kong

Non-Executive and

Non-Independent Director

Mr Wang Anson 3C Eredine,

38 Mount Kellett Road,

Hong Kong

Non-Executive and

Non-Independent Director

Mr Lim Yeow Hua @

Lim You Qin

64 Waterloo Street,

#08-02 Waterloo

Apartments,

Singapore 187959

Non-Executive and Lead

Independent Director

Mr Heng Hock Kiong @

Heng Hang Siong

132A Hillview Avenue,

#06-05 Montrosa,

Singapore 669604

Non-Executive and


Mr Lim Gee Kiat 51 Sims Drive,

#07-138,

Singapore 380051

Non-Executive and


2. REGISTERED OFFICE

The registered office of the Company is at 9 Battery Road #15-01 Straits Trading Building,

Singapore 049910.

3. PRINCIPAL ACTIVITIES

The Company was incorporated in the Republic of Singapore on 9 March 2004 and was listed

on the Main Board of the SGX-ST on 15 April 2010.

The Group’s operations are strategically located and geographically diversified across

various provinces throughout the PRC. The Company offers a diversified and complementary

product portfolio, comprising two key business segments: processed vegetables and fresh

vegetables produce. The Company is one of the few integrated vegetable processing

companies based in the PRC which possesses vegetable processing capabilities as well as

its own cultivation bases. The Company’s extensive processing platform, encompassing

processing methods such as air-drying, freeze-drying, fresh-packing and brining, allows the

Group to offer more than 100 types of processed vegetables to its customers. As part of its

integrated operations, the Company’s cultivation capabilities allow it to manage its supply of

fresh vegetables and supply raw materials for its processing operations.

II-1

4. SHARE CAPITAL

4.1 Issued share capital

The Company has one class of shares, being ordinary shares. As at the Latest Practicable

Date, the issued and paid-up share capital of the Company is S$296,149,207 comprising

655,439,000 Shares. The issued Shares are listed and quoted on the Main Board of the

SGX-ST.

4.2 Capital, dividends and voting

The rights of Shareholders in respect of capital, dividends and voting are contained in the

Articles of Association, which is available for inspection at the Company’s registered office

at 9 Battery Road #15-01 Straits Trading Building, Singapore 049910. The relevant articles

in the Articles of Association relating to the rights of Shareholders in respect of capital,

dividends and voting have been extracted from the Articles of Association and are set out in

Appendix IV to this Circular. Capitalised terms and expressions not defined in the extracts

have the meanings ascribed to them in the Articles of Association.

4.3 Number of Shares issued since the end of the last financial year

No Shares have been issued by the Company since the end of the last financial year up to

the Latest Practicable Date.

4.4 Options and convertible instruments

As at the Latest Practicable Date, save for the outstanding ESOS Options granted under the

Scheme as disclosed below, there are no outstanding instruments convertible into, rights to

subscribe for, and options in respect of securities being offered for or which carry voting

rights affecting the Shares in the Company.

Date of Grant

No. of Shares

comprised in

outstanding

ESOS Options

Exercise price

per Share (S$)

Exercise Period

From To

21 September 2011 2,462,000 1.26 20 September

2012

20 September

2014

4 September 2012 2,678,000 0.74 3 September

2013

3 September

2015

5. DISCLOSURE OF INTERESTS

5.1 Interests of the Company in Offeror Securities

The Company does not have any direct or deemed interests in the Offeror Securities as at

the Latest Practicable Date.

5.2 Dealings in Offeror Securities by the Company

The Company has not dealt for value in the Offeror Securities during the period commencing

six (6) months prior to the Offer Announcement Date, and ending on the Latest Practicable

Date.

II-2

5.3 Interests of Directors in Offeror Securities

None of the Directors has any direct or deemed interests in the Offeror Securities as at the

Latest Practicable Date.

5.4 Dealings in Offeror Securities by the Directors

None of the Directors has dealt for value in the Offeror Securities during the period

commencing six (6) months prior to the Offer Announcement Date, and ending on the Latest

Practicable Date.

5.5 Interests of the Directors in the Company Securities

Save as disclosed below, as at the Latest Practicable Date, none of the Directors has any

direct or deemed interests in the Company Securities:

(a) Shares

Name of

Director

Direct interest Deemed interest Total interest

No. of

Shares %(1)

No. of

Shares %(1)

No. of

Shares %(1)

Mr Lin Guo

Rong 13,103,000 2.00 22,411,297(2) 3.42 35,514,297 5.42

Notes:

(1) Based on 655,439,000 issued Shares as at the Latest Practicable Date.

(2) Mr Lin Guo Rong is deemed interested in the 22,411,297 Shares directly held by China Minzhong

Holdings Limited (the “Minzhong BVI Shares”), which is solely owned by Mr Siek Wei Ting, the Chief

Financial Officer of the Company, who is holding the Minzhong BVI Shares on trust for the following

individuals in the respective proportions:

(i) Mr Lin Guo Rong, Executive Chairman and Chief Executive Officer of the Company: 24.12%;

(ii) Mr Wang Dazhang, Chief Operations Officer of the Company: 37.94%; and

(iii) Mr Huang Bing Hui, Chief Technology Officer of the Company: 37.94%.

(b) ESOS Options

Name of

Director

Date of

Grant

No. of

ESOS

Options

Shares

comprised in

outstanding

ESOS

Options

Exercise

Price

per Share

(S$) Exercise period

Mr Lin Guo

Rong

21 September

2011

752,000 752,000 1.26 From

20 September

2012 to

20 September

2014

Mr Lin Guo

Rong

4 September

2012

819,000 819,000 0.74 From

3 September

2013 to

3 September

2015

II-3

5.6 Dealings in Company Securities by the Directors

Save as disclosed below, none of the Directors has dealt for value in the Company Securities

during the period commencing six (6) months prior to the Offer Announcement Date, and

ending on the Latest Practicable Date.

Name of Director

Date of

Transaction

Number of

Shares sold

Price per Share

(S$)

Mr Wang Anson(1) 3 April 2013 358,000 1.14

4 April 2013 493,333 1.12

11 April 2013 1,884,666 1.10

12 April 2013 511,334 1.11

15 April 2013 456,000 1.09

16 April 2013 372,000 1.08

17 April 2013 1,141,304 1.06

18 April 2013 1,457,566 1.02

Note:

(1) CMIA Capital Partners Pte Ltd (“CMIA”) is the manager of certain funds and investment vehicles which owned

and sold 6,674,203 Shares (the “Relevant Shares”) between 3 April 2013 to 18 April 2013 as set out above.

Mr Anson Wang was deemed interested in the Relevant Shares as he is the managing partner of CMIA.

5.7 Company Securities owned or controlled by the IFA

None of PwCCF, its related corporations or any of the funds whose investments are managed

by PwCCF and its related corporations on a discretionary basis owns or controls any

Company Securities as at the Latest Practicable Date.

5.8 Dealings in Company Securities by the IFA

None of PwCCF, its related corporations or any of the funds whose investments are managed

by PwCCF and its related corporations on a discretionary basis has dealt for value in any

Company Securities during the period commencing six (6) months prior to the Offer

Announcement Date, and ending on the Latest Practicable Date.

5.9 Directors’ Intentions in relation to the Offer

As at the Latest Practicable Date, Mr Lin Guo Rong has a direct and deemed interest in an

aggregate of 35,514,297 Shares, representing approximately 5.42% of the total number of

issued Shares, and holds 1,571,000 ESOS Options. Mr Lin Guo Rong has informed the

Company that as he has undertaken to reject the Offer pursuant to the irrevocable

undertaking that he has provided in favour of the Offeror (details of which are set out in

Section 3 of this Circular), he will not be tendering any of the Shares held by him in

acceptance of the Offer.

Save for Mr Lin Guo Rong, none of the Directors has any direct interest in the Shares.

II-4

6. OTHER DISCLOSURES

6.1 Directors’ service contracts

As at the Latest Practicable Date:

(a) there are no service contracts between any of the Directors or proposed directors with

the Company or any of its subsidiaries which have more than 12 months to run and

which are not terminable by the employing company within the next 12 months without

paying any compensation; and

(b) there are no such service contracts entered into or amended during the period

commencing six (6) months prior to the Offer Announcement Date and ending on the

Latest Practicable Date.

6.2 Arrangements affecting Directors

As at the Latest Practicable Date:

(a) save as disclosed in this Circular, there are no agreements or arrangements made

between any Director and any other person in connection with or conditional upon the

outcome of the Offer;

(b) it is not proposed that any payment or other benefit shall be made or given to any

Director or director of any other corporation which is by virtue of Section 6 of the

Companies Act deemed to be related to the Company, as compensation for loss of office

or otherwise in connection with the Offer; and

(c) none of the Directors has a material personal interest, whether direct or indirect, in any

material contract entered into by the Offeror.

6.3 Glaucus research report and Company’s responses

Glaucus Research Group California, LLC (“Glaucus”) had on 26 August 2013 and 2

September 2013 published reports (“Reports”) regarding certain affairs of the Group. Their

initial report on 26 August 2013 had caused a substantial decrease in the share price of the

Company. Glaucus had openly stated that they were short sellers and their intention was to

profit from the decline of the Company’s stock price.

The Company had in its responses dated 1 and 3 September 2013 (“Responses”) refuted

the allegations by Glaucus and was of the view that the opinions and inferences drawn by

Glaucus were reckless and done without due regard to the accuracy of such statements. The

Responses to the Reports are available on the website of the SGX-ST at www.sgx.com. The

Company is consulting its legal advisers on possible recourse and may take legal action to

defend its rights and reputation.

II-5

7. MATERIAL CONTRACTS WITH INTERESTED PERSONS

Save as disclosed below, as at the Latest Practicable Date, neither the Company nor any of

its subsidiaries has entered into material contracts (other than those entered into in the

ordinary course of business) with persons who are interested persons1 during the period

commencing three (3) years before the Offer Announcement Date and ending on the Latest

Practicable Date:

Mr Lin Guo Rong, the Executive Chairman and Chief Executive Officer of the Company, has

provided personal guarantees to secure banking facilities extended to a subsidiary of the

Company, Fujian Minzhong Organic Food Co., Ltd., by the Agricultural Bank of China and

Industrial Bank Co., Ltd., details of which are set out as follows:

Expiry date of the guarantee

Amount

Guaranteed

(RMB’million)

Amount of loan

drawdown as at

the Latest

Practicable Date

(RMB’million) Lender

30 December 2012 60.0 – Industrial Bank Co., Ltd

15 March 2013 10.0 – Agricultural Bank of China

30 December 2014 50.0 – Industrial Bank Co., Ltd

6 March 2016 100.0 60.0 Industrial Bank Co., Ltd

8. MATERIAL LITIGATION

As at the Latest Practicable Date, none of the Company or its subsidiaries is engaged in any

material litigation, either as plaintiff or defendant, which might materially and adversely affect

the financial position of the Company or the Group, taken as a whole. The Directors are not

aware of any litigation, claims or proceedings pending or threatened against, or made by, the

Company or any of its subsidiaries or of any facts likely to give rise to any such litigation,

claims or proceedings, which might materially and adversely affect the financial position of

the Company or the Group, taken as a whole.

1 An “interested person” is defined in the Note on Rule 23.12 of the Code to mean:

(a) a director, chief executive officer or substantial shareholder of the Company;

(b) the immediate family of a director, the chief executive officer or a substantial shareholder (being an individual)

of the Company;

(c) the trustees, acting in their capacity as such trustees, of any trust of which a director, the chief executive

officer or a substantial shareholder (being an individual) and his immediate family is a beneficiary;

(d) any company in which a director, the chief executive officer or a substantial shareholder (being an individual)

together and his immediate family together (directly or indirectly) have an interest of 30% or more;

(e) any company that is the subsidiary, holding company or fellow subsidiary of the substantial shareholder (being

a company); or

(f) any company in which a substantial shareholder (being a company) and any of the companies listed in (e)

above together (directly or indirectly) have an interest of 30% or more.

II-6

9. MARKET QUOTATIONS

The information on the closing prices and aggregate trading volume of the Shares on the

SGX-ST set out in italics below has been extracted from paragraph 3 of Appendix III to the

Offer Document. All terms and expressions used in the extract below shall have the same


“3. MARKET QUOTATIONS

The closing price of the Shares on the SGX-ST, as reported by Bloomberg L.P., on (a)

the Latest Practicable Date was S$1.125, and (b) the Relevant Trading Day was

S$1.015. The highest, lowest, and last closing prices and trading volume of the Shares

on the SGX-ST on a monthly basis from March 2013 up till the Latest Practicable Date,

as reported by Bloomberg L.P., are set out below:

Date

Highest closing

price of the month

Lowest closing

price of the month

Last closing price

of the month

Volume of

Shares traded

(S$) (S$) (S$)

March 2013 1.230 1.100 1.200 218,203,000

April 2013 1.175 0.995 1.000 103,383,000

May 2013 1.100 0.965 1.030 118,904,000

June 2013 1.080 0.925 1.045 68,963,000

July 2013 1.135 1.030 1.055 54,965,000

August 2013 1.100 0.530 0.530 68,524,000

1 September

2013 up to

the Latest

Practicable

Date 1.125 1.115 1.125 325,706,000

During the period commencing six (6) months preceding the Offer Announcement Date

and ending on the Latest Practicable Date (being 2 March 2013 to 12 September 2013

(both dates inclusive)):

(a) the highest closing price of the Shares on the SGX-ST, as reported by Bloomberg

L.P., was S$1.230 which was transacted on 5 March 2013; and

(b) the lowest closing price of the Shares on the SGX-ST, as reported by Bloomberg

L.P., was S$0.530, which was transacted on 26 August 2013.”

II-7

10. FINANCIAL INFORMATION

10.1 Consolidated income statements

The audited consolidated income statements of the Group for FY2010, FY2011 and FY2012

and the unaudited consolidated statement of comprehensive income of the Group for the

financial year ended 30 June 2013 are summarised in the table below. The summary is

extracted from, and should be read in conjunction with, the consolidated financial statements

of the Group for the relevant financial periods and the related notes thereto (copies of which

are available for inspection as mentioned in Paragraph 12 of Appendix II to this Circular):

Audited

FY2010

(RMB’million)

Audited

FY2011

(RMB’million)

Audited

FY2012

(RMB’million)

Unaudited

FY2013

(RMB’million)

Revenue 1,422.6 1,929.2 2,568.8 3,247.8

Cost of sales (848.2) (1,128.6) (1,582.9) (2,132.1)

Gross profit 574.4 800.6 985.9 1,115.7

(Loss)/Gain on fair value

of biological assets less

estimated point-of-sales

costs (15.2) 1.2 (8.0) (18.0)

Other income 6.5 9.1 21.6 49.4

Selling and distribution

expenses (20.6) (56.2) (118.7) (121.4)

Administrative expenses (77.6) (80.5) (98.7) (124.5)

Other expenses (10.9) (14.1) (20.1) (51.4)

Finance costs (23.9) (6.3) (35.8) (47.9)

Profit before income tax 432.7 653.8 726.2 801.9

Income tax (65.2) (87.1) (46.6) (46.8)

Profit for the year 367.5 566.7 679.6 755.1

Currency translation

difference arising from

consolidation (1.2) 8.0 (1.7) (6.8)

Total comprehensive

income 366.3 574.7 677.9 748.3

Earnings per share

(RMB)

Basic 1.13 1.04 1.22 1.28

Diluted 1.09 1.04 1.22 1.28

II-8

10.2 Statement of Financial Position

The audited consolidated statement of financial position of the Group as at 30 June 2012 and

the unaudited consolidated statement of financial position of the Group as at 31 June 2013

are summarised in the table below. The summary is extracted from, and should be read in

conjunction with, the consolidated financial statements of the Group for the relevant financial

periods and the related notes thereto (copies of which are available for inspection as

mentioned in Paragraph 12 of Appendix II to this Circular):

Audited

As at

30 June 2012

(RMB’million)

Unaudited

As at

30 June 2013

(RMB’million)

EQUITY

Share capital and reserves

Share capital 1,072.3 1,503.8

Statutory reserve fund 79.0 94.0

Employees’ share option reserve 1.7 4.6

Translation reserve/(deficit) 6.1 (0.7)

Retained earnings 2,428.2 3,168.3

TOTAL EQUITY 3,587.3 4,770.0

ASSETS

Non-current assets

Deferred tax assets 6.0 6.0

Property, plant and equipment 1,832.0 2,068.5

Land use rights 126.5 123.7

Biological assets 168.0 150.0

Land improvement costs 347.7 259.7

Operating lease prepayments 448.2 372.8

Total non-current assets 2,928.4 2,980.7

Current assets

Land use rights 2.8 2.8

Biological assets 34.6 33.6

Inventories 104.1 69.4

Trade receivables 967.1 1,098.0

Other receivables and prepayments 416.6 761.2

Operating lease prepayments 67.7 62.8

Cash and bank balances 66.2 826.4

Total current assets 1,659.1 2,854.2

TOTAL ASSETS 4,587.5 5,834.9

II-9

Audited

As at

30 June 2012

(RMB’million)

Unaudited

As at

30 June 2013

(RMB’million)

LIABILITIES

Current liabilities

Trade payables 216.1 303.7

Other payables and accruals 132.1 97.8

Bank term loans 612.6 635.6

Income tax liabilities 7.3 0.04

Government grants 3.5 3.4

Total current liabilities 971.6 1,040.5

Non-current liabilities

Bank term loans 3.6 –

Deferred tax liabilities – 2.7

Government grants 25.0 21.7

Total non-current liabilities 28.6 24.4

TOTAL LIABILITIES 1,000.2 1,064.9

10.3 Accounting Policies

Save as disclosed in the notes to the audited consolidated financial statements of the Group

for FY2012 as contained in the annual reports of the Company for FY2012 (which is available

for inspection as mentioned in Paragraph 12 of Appendix II to this Circular), and the

Company’s announcement on the unaudited consolidated financial statements of the Group

for FY2013 set forth in Appendix III to this Circular:

(a) there were no significant accounting policies or any matter from the notes of the

financial statements of the Group which are of any major relevance for the interpretation

of the financial statements of the Group; and

(b) as at the Latest Practicable Date, there is no change in the accounting policy of the

Group which will cause the figures disclosed in this Circular not to be comparable to a

material extent.

10.4 Material changes in financial position

Save as disclosed in publicly available information on the Group (including but not limited to

the unaudited consolidated financial statements of the Company for the financial year ended

30 June 2013 which were released by the Company on 29 August 2013), as at the Latest

Practicable Date, there has been no known material change in the financial position of the

Company since 30 June 2012, being the date of the Company’s last published audited

financial statements.

II-10

10.5 Material change in information

Save as disclosed in this Circular and save for the information relating to the Company and

the Offer that is publicly available, there has been no material change in any information

previously published by or on behalf of the Company during the period commencing from the

Offer Announcement Date and ending on the Latest Practicable Date.

11. GENERAL

(a) All expenses and costs incurred by the Company in relation to the Offer will be borne

by the Company.

(b) PwCCF has given and has not withdrawn its written consent to the issue of this Circular

with the inclusion of (i) its name, (ii) the IFA Letter, and (iii) all references thereto in the

form and context in which they appear in this Circular.

12. DOCUMENTS FOR INSPECTION

Copies of the following documents are available for inspection at the registered office of the

Company at 9 Battery Road, #15-01 Straits Trading Building, Singapore 049910 during

normal business hours for the period during which the Offer remains open for acceptance:

(a) the Memorandum and Articles of Association of the Company;

(b) the annual reports of the Company for FY2010, FY2011 and FY2012;

(c) the unaudited consolidated financial statements of the Group for the financial year

ended 30 June 2013 (as announced by the Company on 29 August 2013);

(d) the IFA Letter; and

(e) the letter of consent from PwCCF referred to in Paragraph 11 of Appendix II to this

Circular.

II-11

This page has been intentionally left blank.

APPENDIX III

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS OF

THE GROUP FOR FY2013

III-1

CHINA MINZHONG FOOD CORPORATION LIMITED(Registration No. 200402715N)

nm: not meaningful 1

PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL YEAR RESULTS

The directors are pleased to announce the results for the quarter period from 1 April 2013 to 30 June2013 (“4QFY2013”) and the results for the financial year ended 30 June 2013 (“FY2013”). The comparatives are for the quarter period from 1 April 2012 to 30 June 2012 (“4QFY2012”) and the financial year ended 30 June 2012 (“FY2012”). These figures have not been audited. In addition, the directors would like to refer shareholders to the company’s response to the report released by Glaucus Research Group on 26 August 2013 regarding certain affairs of the company and its subsidiaries, which is expected to be released by the end of this week.

1(a) An income statement (for the group) together with a comparative statement for the corresponding period of the immediately preceding financial year.

GroupNote8(A)

1.7.2012 to 30.6.2013

1.7.2011 to 30.6.2012 Change 1.4.2013 to

30.6.20131.4.2012 to 30.6.2012 Change

RMB'000 RMB'000 % RMB'000 RMB'000 %

Revenue 1 3,247,773 2,568,839 26.4% 811,279 803,495 1.0%

Cost of sales (2,132,115) (1,582,951) 34.7% (518,668) (513,645) 1.0%

Gross profit 2 1,115,658 985,888 13.2% 292,611 289,850 1.0%

Gross profit margin (%) 34.4% 38.4% (4.0ppt) 36.1% 36.1% -

Loss on fair value of biological assets less estimated point of sales cost

3 (18,000) (8,000) nm (9,000) (3,600) nm

Other income 4 49,389 48,619 1.6% 15,280 10,548 44.9%

Selling and distributionexpenses 5 (121,398) (118,728) 2.2% (51,301) (66,048) (22.3%)

Administrative expenses 6 (124,495) (98,700) 26.1% (43,932) (21,478) 104.5%

Other expenses 7 (51,354) (47,081) 9.1% (24,092) (22,855) 5.4%

Financial cost 8 (47,877) (35,828) 33.6% (7,806) (15,293) (49.0%)

Profit before income tax 9 801,923 726,170 10.4% 171,760 171,124 0.4%

Income tax 10 (46,858) (46,589) 0.6% (9,101) (105) >100%

Profit for the year / period 755,065 679,581 11.1% 162,659 171,019 (4.9%)

Net profit margin (%) 23.2% 26.5% (3.3ppt) 20.0% 21.3% (1.3ppt)

Other comprehensive loss:Currency translation difference arising from consolidation

(6,783) (1,686) nm (1,481) (394) nm

Totalcomprehensive income

748,282 677,895 10.4% 161,178 170,625 (5.5%)

Earnings per share (RMB) (Note 6)

Basic 1.28 1.22 5.0% 0.25 0.31 (19.1%)

Diluted 1.28 1.22 4.8% 0.25 0.31 (19.2%)

III-2


2

Profit before income tax

Profit before income tax is arrived at after charging / (crediting) the following:

Group

1.7.2012 to 30.6.2013

1.7.2011 to 30.6.2012

1.4.2013 to 30.6.2013

1.4.2012 to 30.6.2012

RMB’000 RMB’000 RMB’000 RMB’000

Depreciation of property, plant and equipment 81,012 57,480 21,751 19,271

Write off of property, plant and equipment 376 1,277 253 7

Loss on disposal of plant and equipment - 440 - -

Amortisation of land use rights 2,751 2,757 621 625

Amortisation of land improvement costs 91,823 64,222 22,883 18,325

Amortisation of operating lease prepayments 67,054 67,693 16,388 16,293

Written off of other payables (5,220) (2,359) (5,220) (2,359)

Impairment allowance for trade receivables 11,451 16,977 11,451 16,977

Loss on fair value of biological assets less estimated point of sales cost 18,000 8,000 9,000 3,600

Amortisation of government grant (7,963) (12,131) (948) (185)

Interest income (459) (353) (160) (180)

Interest expenses on bank term loans 47,877 35,828 8,185 15,120

III-3


3

1(b)(i) A balance sheet (for the issuer and group), together with a comparative statement as at the end of the immediately preceding financial year.

Group CompanyUnaudited Audited Unaudited Audited30.6.2013 30.06.2012 30.6.2013 30.06.2012RMB’000 RMB’000 RMB’000 RMB’000

Share capital and reservesShare capital 1,503,789 1,072,268 1,503,789 1,072,268Statutory reserve fund 93,995 79,007 - -Employees’ share option reserve 4,629 1,740 4,629 1,740Translation reserve (677) 6,106 (19,040) 14,932Accumulated profits / (losses) 3,168,278 2,428,201 (112,078) (150,052)

TOTAL EQUITY 4,770,014 3,587,322 1,377,300 938,888

Non-current assetsDeferred tax assets 6,000 6,000 - -Property, plant and equipment 2,068,503 1,831,968 1,537 -Land use rights 123,740 126,500 - -Biological assets 150,000 168,000 - -Land improvement costs 259,721 347,668 - -Investment in subsidiaries - - 1,293,640 919,064Operating lease prepayments 372,782 448,180 - -

Current assetsLand use rights 2,766 2,757 - -Biological assets 33,641 34,635 - -Inventories 69,397 104,125 - -Trade receivables 1,097,969 967,115 - -Due from subsidiary (non-trade) - - 86,073 25,567Other receivables and prepayments 761,176 416,645 588 364Operating lease prepayments 62,787 67,693 - -Cash and bank balances 826,431 66,209 16,850 5,286

2,854,167 1,659,179 103,511 31,217

TOTAL ASSETS 5,834,913 4,587,495 1,398,688 950,281

III-4


4

1(b)(i) A balance sheet (for the issuer and group), together with a comparative statement as at the end of the immediately preceding financial year. (Continued)

Group CompanyUnaudited Audited Unaudited Audited30.6.2013 30.06.2012 30.6.2013 30.06.2012RMB’000 RMB’000 RMB’000 RMB’000

Current liabilitiesTrade payables 303,698 216,058 - -Other payables and accruals 97,771 132,145 18,738 11,393Bank term loans 635,646 612,630 - -Income tax liabilities 45 7,287 - -Government grants 3,354 3,501 - -

1,040,514 971,621 18,738 11,393

Non-current liabilitiesGovernment grants 21,735 24,997 - -Bank term loans - 3,555 - -Deferred tax liabilities 2,650 - 2,650 -

24,385 28,552 2,650 -

TOTAL LIABILITIES 1,064,899 1,000,173 21,388 11,393

NET ASSETS 4,770,014 3,587,322 1,377,300 938,888

III-5


5

1(b)(ii) Aggregate amount of group’s borrowings and debt securities.

Bank term loans

Unaudited Audited30.6.2013 30.6.2012RMB’000 RMB’000

Non-interest bearing loan, secured 1,915 3,830

Less: Discount implicit in long-term interest free bank loan (490) (980)

Fair value of interest-free bank loan at inception 1,425 2,850Add: Amortisation of discount 421 705

Net carrying amount at end of period 1,846 3,555

Interest bearing loans:- Secured 29,800 29,630- Unsecured 464,000 438,000- Guaranteed 140,000 (1) 145,000

633,800 612,630

Total bank term loans 635,646 616,185

Interest rates for short-term bank loans range from 5.880% to 8.203% (2012: 6.405% to 9.184%) per annum. Some of the short-term bank loans were secured by the Group’s leasehold buildings, plant and machinery and land use rights.

Non-interest bearing loan of RMB1.915 (2013: RMB3.83 million) is carried at amortised cost and secured over the Group’s land use rights, plant and machinery and leasehold buildings, repayable on 30 October 2013.

Note:-

(1) Sichuan Minzhong Organic Food Co., Ltd (a subsidiary company of the Company) is providing guarantee for RMB100.0 million banking facility extended to the Group, out of which RMB60.0 million was drawn-down. The Company and Mr Lin Guo Rong (Chairman and Executive Director) is providing guarantee for RMB80.0 million banking facility extended to the Group, was fully drawn-down.

III-6


6

1(c) A cash flow statement (for the group), together with a comparative statement for the corresponding period of the immediately preceding financial year.

Group1.7.2012 to 30.6.2013

1.7.2011 to 30.6.2012

1.4.2013 to 30.6.2013

1.4.2012 to 30.6.2012

RMB’000 RMB’000 RMB’000 RMB’000Cash flows from operating activitiesProfit before income tax 801,923 726,170 171,760 171,124Adjustments for:


Write off of plant and equipment 376 1,277 253 7(Gain) / Loss on disposal of assets (1,170) 440 (1,170) -Amortisation of land use rights 2,751 2,757 621 625Amortisation of land improvement costs 91,823 64,222 22,883 18,325Amortisation of operating lease prepayments 67,054 67,693 16,388 16,923

Reversal of other payables (5,220) (2,359) (5,220) (2,359)Impairment allowance for trade receivables 11,451 16,977 11,451 16,977

Reversal of allowance for doubtful trade receivables (1,201) - - -

Loss on fair value of biological assets less estimated point of sales cost 18,000 8,000 9,000 3,600

Amortisation of government grant (7,963) (12,131) (948) (185)Interest income (459) (353) (160) (180)Interest expenses on bank term loans 47,877 35,828 8,185 15,120Employees’ share option value 2,889 1,740 - -

Operating profit before working capital changes 1,109,143 967,741 254,794 259,248Inventories 34,728 (50,225) 9,880 109,872Biological assets 994 (7,088) 221 13,825Trade receivables (141,104) (754,031) (9,557) (121,620)Other receivables and prepayments (57,301) 48,287 (75,736) 69,348Trade payables 87,640 131,373 (107,060) (229,643)Other payables and accruals (33,749) 81,094 (4,281) 25,106

Cash generated from operations 1,000,351 417,151 68,261 126,136

Income tax paid (51,450) (58,421) (6,544) (13,395)Interest received 459 353 160 180

Net cash generated from operating activities 949,360 359,083 61,877 112,921

III-7


7

1(c) A cash flow statement (for the group), together with a comparative statement for the corresponding period of the immediately preceding financial year. (Continued)

Group1.7.2012 to 30.6.2013

1.7.2011 to 30.6.2012

1.4.2013 to 30.6.2013

1.4.2012 to 30.6.2012

RMB’000 RMB’000 RMB’000 RMB’000Cash flows from investing activitiesPurchase of property, plant and equipment (600,558) (640,473) (17,873) (185,392)Proceeds from disposal of assets 16,170 400 16,170 -Land improvement costs (5,626) (92,156) (737) 2,560Purchase of land use rights - (908) - 1,047

Net cash used in investing activities (590,014) (733,137) (2,440) (181,785)

Cash flows from financing activitiesProceeds from issuance of new shares 454,819 - - -Share issue expense (23,298) - - -Proceeds from bank loans 883,800 802,000 286,000 301,000Repayment of bank loans (864,545) (513,130) (239,000) (270,500)Government grant received 4,554 26,270 60 (553)Interest paid (47,671) (35,622) (8,134) (15,068)Pledged cash (17,120) (24,075) 17,903 (6,075)

Net cash generated from financing activities 390,539 255,443 56,829 8,804

Net increase / (decrease) in cash and cash equivalents 749,885 (118,611) 116,266 (60,060)

Cash and cash equivalents at beginning of year / period 42,134 162,431 670,451 102,588

Effect of exchange rate changes (6,783) (1,686) (1,481) (394)

Cash and cash equivalents at end of year / period as stated in the consolidated statements of cash flows 785,236 42,134 785,236 42,134

Cash pledged to notes payables (1) 41,195 24,075 41,195 24,075

Cash and cash equivalents at end of year / period as stated in the consolidatedbalance sheets 826,431 66,209 826,431 66,209

Note: (1) RMB41.2 million (2012: RMB24.1 million) cash was pledged to secure RMB188.5 million (2012: RMB110.3 million) of

notes payables.

III-8

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III-9

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III-10


10

1(d)(ii) Details of any changes in the company's share capital arising from rights issue, bonus issue, share buy-backs, exercise of share options or warrants, conversion of other issues of equity securities, issue of shares for cash or as consideration for acquisition or for any other purpose since the end of the previous period reported on. State also the number of shares that may be issued on conversion of all the outstanding convertibles as well as the number of shares held on treasury shares, as at the end of the current financial period reported on and as at the end of the corresponding period of the immediately preceding financial year.

FY2013

Granting of Share Options

Pursuant to the Board Meeting held on 24 August 2012, the Directors approved the grant of2,678,000 share options of the Company to selected eligible employees of the Group and Director of the Company to subscribe for 2,678,000 ordinary shares in the Company at anexercise price of S$0.74 on 4 September 2012, under the CMZ Employee Share OptionScheme 2010 which was approved on 31 March 2010. Options granted have a term of nolonger than 3 years, and with 1 year vesting period from grant date. The total fair value of theoptions granted was estimated to be S$583,418 (equivalent to RMB2,889,496) as at the grantdate of options using Black-Scholes-Merton Model.

As at 30 June 2013, no share option was being exercised.

Issuance of New Shares

On 15 February 2013, the Company entered into a subscription agreement with PT Indofood Sukses Makmur Tbk (the “Subscriber”), pursuant to which the Company shall allot and issue 98,000,000 new ordinary shares in the Company (“New Shares”) to the Subscriber at S$0.915 per New Share (the “Subscription Price”) (the “Proposed Subscription”). The New Shares will represent approximately 14.95% of the issued and paid-up share capital of the Company immediately following the completion of the Proposed Subscription.

On 27 February 2013, the Proposed Subscription was completed, pursuant to which 98,000,000 New Shares were allotted and issued to the Subscriber at the Subscription Price.

FY2012

Exercise of Share Options

Pursuant to the Board Meeting held on 24 August 2011, the Directors approved the grant of2,462,000 share options of the Company to selected eligible employees of the Group andDirector of the Company to subscribe for 2,462,000 ordinary shares in the Company at anexercise price of S$1.26 on 21 September 2011, under the CMZ Employee Share OptionScheme 2010 which was approved on 31 March 2010. Options granted have a term of nolonger than 3 years, and with 1 year vesting period from grant date. The total fair value of theoptions granted was estimated to be S$339,023 (equivalent to RMB1,739,649) as at the grantdate of options using Black-Scholes-Merton model.

As at 30 June 2013, no share option was being exercised.

III-11


11

1(d)(iii) To show the total number of issued shares excluding treasury shares as at end of the current financial period and as at the end of the immediately preceding year.

Resultant Issued and Paid Up Share Capital

Number of new Shares issued

Number of Shares (S$’000)

As at 30 June 2012 - 557,439,000 219,629

Issuance of new shares 98,000,000 655,439,000 89,670Share issuance expenses - - (4,593)

As at 31 March 2013 98,000,000 655,439,000 304,706

1(d)(iv) A statement showing all sales, transfers, disposal, cancellation and/or use of treasury shares as at end of the current period reported on.

During the current financial period and the immediately preceding financial year, the Company does not have any outstanding treasury shares.

2. Whether the figures have been audited or reviewed and in accordance with which auditing standard or practice.

The figures have not been reviewed or audited by the Group’s auditors.

The figures are management figures prepared in accordance with the provisions of the Singapore Companies Act, Cap. 50 (the “Act”) and Singapore Financial Reporting Standards.

3. Where the figures have been audited or reviewed, the auditors’ report (including any qualifications or emphasis of a matter).

Not applicable.

4. Whether the same accounting policies and methods of computation as in the issuer’s most recently audited annual financial statements have been applied.

The Group has applied the same accounting policies and methods of computation in the financial statements for the current financial period as those used in the audited financial statements as of 30 June 2012.

5. If there are any changes in the accounting policies and methods of computation, including any required by an accounting standard, what has changed, as well as the reasons for, and the effect of, the change.

As per above point 4.

III-12


12

6. Earnings per ordinary share of the group for the current financial period reported on and the corresponding period of the immediately preceding financial year, after deducting any provision for preference dividends.

Basic earnings per share

Basic earnings per share are calculated by dividing the profit attributable to equity holders of the Company for the respective periods and the weighted average number of shares

1.7.2012 to 30.6.2013

1.7.2011 to 30.6.2012

1.4.2013 to 30.6.2013

1.4.2012 to 30.6.2012

Based on weighted average number of ordinary shares on issue (RMB) 1.28 1.22 0.25 0.31

Weighted average number of shares (in thousands) 590,106 557,439 655,439 557,439

Diluted earnings per share

Diluted earnings per share are calculated by dividing the profit attributable to equity holders of the Group for the respective periods and the weighted average number of shares, adjusted for the effects of all dilutive ordinary shares. In the current financial year/period, the Group does not have any potential dilutive instruments.

1.7.2012 to 30.6.2013

1.7.2011 to 30.6.2012

1.4.2013 to 30.6.2013

1.4.2012 to 30.6.2012

On a fully diluted basis (RMB) 1.28 1.22 0.25 0.31

Weighted average number of shares (in thousands) 509,749 557,439 656,211 557,439

7. Net asset value (for the issuer and group) per ordinary share based on issued share capital of the issuer at the end of the: (a) current financial period reported on; and (b) immediately preceding financial year.

Group Company

30.6.2013 30.6.2012 30.6.2013 30.6.2012

Net asset value per ordinary share based on issued share capital at the end of the financial year/period (RMB):

7.28 6.44 2.10 1.67

No. of shares in computing NAV (in thousands) 655,439 557,439 655,439 557,439

III-13


13

8. A review of the performance of the group, to the extent necessary for a reasonable understanding of the group’s business. It must include a discussion of the following:

(a) any significant factors that affected the turnover, costs, and earnings of the group for the current financial period reported on, including (where applicable) seasonal or cyclical factors; and

(b) any material factors that affected the cash flow, working capital, assets or liabilities of the group during the current financial period reported on.

REVIEW OF PERFORMANCE

(A) Consolidated Income Statement

1. Revenue

The following table provides a breakdown of our revenue by business segments in FY2013, FY2012,4QFY2013 and 4QFY2012 respectively:-

FY2013 FY2012 4QFY2013 4QFY2012RMB’000 % RMB’000 % RMB’000 % RMB’000 %

Processed Business Segment:

- Processed vegetables 1,804,232 55.6 1,451,770 56.5 460,405 56.8 418,323 52.0- Beverages 195,943 6.0 51,501 2.0 49,959 6.0 32,354 4.0- Others(1) 86,059 2.6 80,992 3.1 14,669 1.9 20,365 2.6

Subtotal 2,086,234 64.2 1,584,263 61.6 525,033 64.7 471,042 58.6Cultivation Business

Segment:- Fresh vegetables produce 1,070,983 33.0 870,176 33.9 286,246 35.3 332,453 41.4

- Mushroom spores(2) 90,556 2.8 114,400 4.5 - - - -

Subtotal 1,161,539 35.8 984,576 38.4 286,246 35.3 332,453 41.4

Total revenue 3,247,773 100.0 2,568,839 100.0 811,279 100.0 803,495 100.0

Note:-(1) Include IQF processed products and other miscellaneous products (such as instant food and health food products)(2) Sales of mushroom spores

1.1 Revenue (FY2013 vs FY2012)

Our revenue increased by 26.4% or RMB679.0 million, to RMB3,247.8 million (FY2012: RMB2,568.8million). This was due to the increase in sales of our processed and fresh business segments.

Revenue from processed vegetables increased by 24.3% or RMB352.4 million, to RMB1,804.2 million (FY2012: RMB1,451.8 million), was mainly due to increased revenue from air-dried and fresh-packed product categories by approximately 52% and 70% respectively, attributing to strong demands fromboth our existing and new customers.

Revenue from beverages increased by 280.4% or RMB144.4 million, to RMB195.9 million (FY2012:RMB51.5 million). The increase was attributed to an increase in our sales volume, due to strong domestic demands for our branded beverages.

III-14


14

REVIEW OF PERFORMANCE (Continued)

(A) Consolidated Income Statement (Continued)

1.1 Revenue (FY2013 vs FY2012) (Continued)

Revenue from fresh vegetables produce increased by 23.1% or RMB200.8 million, to RMB1,071.0million (FY2012: RMB870.2 million), due to the increase in our cultivation volume by 62.7% or 129,345tonnes, to 335,756 tonnes (FY2012: 206,411 tonnes). The improved cultivation volume was a result of initial contributions from new productive farmland.

1.2 Revenue (4QFY2013 vs 4QFY2012)

Our revenue increased slightly by 1.0% or RMB7.8 million, to RMB811.3 million (4QFY2012:RMB803.5 million). This was due to the increase in our processed business segment.

Revenue from processed vegetables increased by 10.1% or RMB42.1 million, to RMB460.4 million (4QFY2012: RMB418.3 million), was mainly due to increase from air-dried and fresh-packed product categories.

Revenue from beverages increased by 51.2% or RMB16.6 million, to RMB49.0 million (4QFY2012:RMB32.4 million). The increase was attributed to an increase in our sales volume, due to strong domestic demands for our branded beverages.

Revenue from fresh vegetables produce decreased by 13.9% or RMB46.2 million, to RMB286.2 million (4QFY2012: RMB332.4 million), on the back of a comparison across different seasonal patterns. Due to the delayed winter last year, the Group was still recognising some sales of high yield crops (eg. champignon mushrooms) in 4QFY2012. This year, the weather patterns have normalised and the Group has resumed the conventional cultivation of low-yield crops during the summer period (months of May to September).

On the other hand, cultivation volume increased by 31.1% or 22,045 tonnes, to 92,939 tonnes (4QFY2012: 70,894 tonnes), a result of the contributions from new productive farmland.

III-15


15



2. Gross Profit

The following table provides a breakdown of our gross profit by business segments in FY2013, FY2012,4QFY2013 and 4QFY2012 respectively:-

FY2013 FY2012 4QFY2013 4QFY2012RMB’ mil % RMB’ mil % RMB’ mil % RMB’ mil %

Processed Business Segment:

- Processed vegetables 532,164 47.8 461,488 46.8 139,661 47.7 83,177 28.7- Beverages 53,388 4.8 7,525 0.8 8,182 2.8 5,610 1.9- Others(1) 5,839 0.5 113 0.01 (750) (0.2) (308) (0.1)

Subtotal 591,391 53.1 469,126 47.6 147,093 50.3 88,479 30.5Cultivation Business

Segment:- Fresh vegetables produce 508,170 45.5 499,162 50.6 145,518 49.7 201,371 69.5

- Mushroom spores(2) 16,097 1.4 17,600 1.8 - - - -

Subtotal 524,267 46.9 516,762 52.4 145,518 49.7 201,371 69.5

Total gross profit 1,115,658 100.0 985,888 100.0 292,611 100.0 289,850 100.0

Note:-(1) Include IQF processed products and other miscellaneous products (such as instant food and health food products)(2) Sales of mushroom spores

2.1 Gross Profit (FY2013 vs FY2012)

Our gross profit increased by 13.2% or RMB129.8 million, to RMB1,115.7 million (FY2012: RMB985.9million), in tandem with the increase in our revenue. Our overall gross profit margin has declined by 4.0ppt to 34.4% (FY2012: 38.4%).

Gross profit from processed vegetables increased by 15.3% or RMB70.7 million, to RMB532.2 million (FY2012: RMB461.5 million), in tandem with the increase in revenue. Our overall gross profit margin for processed vegetables has declined by 2.3 ppt to 29.5% (FY2012: 31.8%). The declined gross profit margin was mainly due to higher raw materials costs for processing vegetables.

Gross profit from beverages increased by RMB45.9 million, to RMB53.4 million (FY2012: RMB7.5million), in tandem with the increase in revenue. Gross profit margin for beverages has improved by 12.6ppt to 27.2% (FY2012: 14.6%). The improvement in gross profit margin was attributed to an increase in our sales volume, which lowered the manufacturing overheads for beverages production.

Gross profit from fresh vegetables produce increased by 1.8% or RMB90 million, to RMB508.2 million (FY2012: RMB499.2 million). Gross profit margin for fresh vegetables produce has declined by 9.9 ppt to 47.5% (FY2012: 57.4%). The declined gross profit margin was mainly due to the contribution from new productive farmland.

III-16


16


(B) Consolidated Income Statement (Continued)

2.2 Gross Profit (4QFY2013 vs 4QFY2012)

Our gross profit increased by 1.0% or RMB2.8 million, to RMB292.6 million (4QFY2012: RMB289.8million), was mainly due to increase gross profit from processed business segment.

Gross profit from processed vegetables increased by 67.9% or RMB56.5 million, to RMB139.7 million (4QFY2012: RMB83.2 million), was mainly due to the improved gross profit margin for processed vegetables by 10.4 ppt to 30.3% (4QFY2012: 19.9%).

Gross profit from fresh vegetable produce decreased by 27.8% or RMB55.9 million, to RMB145.5million (4QFY2012: RMB201.4 million), was mainly due to the declined gross profit margin for fresh vegetable produces by 9.8 ppt to 50.8% (4QFY2011: 60.6%).

3. Loss on fair value of biological assets less estimate point of sales cost

We experienced loss on fair value of biological assets in FY2013, amounting to RMB18.0 million. The actual operational result from July 2012 to June 2013 was approximate to the projections of revenue and anticipated costs associated with the biological assets as projected. The loss was due to natural progression over the remaining lease term of the bamboo plantation, through realising the actual returns by recognising sales from harvesting during this financial year.

A reconciliation of the carrying amount of biological assets and loss on fair value of biological assets is as follows:

As at 30.6.2013 As at 30.6.2012RMB’000 RMB’000

At beginning of year 202,635 203,547

Increase due to plantation 561,819 378,104

Decrease due to harvest (562,813) (371,016)

Loss arising from changes in fair value less estimated point-of-sale costs (18,000) (8,000)

At end of year 183,641 202,635

III-17


17



3. Loss on fair value of biological assets less estimate point of sales cost (Continued)

The analysis of the above is as follows:

Carrying value of biological assets Bamboo shoots and trees Vegetables TotalRMB’000 RMB’000 RMB’000

As at 30.6.2012

Non-current portion 168,000 - 168,000

Current portion - 34,635 34,635

Total 168,000 34,635 202,635

As at 30.6.2013

Non-current portion 150,000 - 150,000

Current portion - 33,641 33,641

Total 150,000 33,641 183,641

4. Other income

FY2013 vs FY2012

Other income comprised mainly government grants amortisation (which was mainly received as asubsidy to our interest expenses and capital expenditure) and proceeds received from leasing farmlands to third parties.

The following table provides a breakdown of our other income:

Other income FY2013 FY2012 4QFY2013 4QFY2012

RMB’000 RMB’000 RMB’000 RMB’000

Proceeds from leasing farmlands 33,024 33,459 7,930 8,365

Written off of other payables 5,220 2,359 5,220 2,359

Government grants 7,963 12,131 948 185

Reversal of allowance for doubtful debts 1,201 - - -

Gain on disposal of assets 1,170 - 1,170 -

Others 811 670 12 (361)

Total 49,389 48,619 15,280 10,548

III-18


18



5. Selling and distribution expenses

FY2013 vs FY2012

Selling and distribution expenses increased by 2.2% or RMB2.7 million, to RMB121.4 million (FY2012:RMB118.7 million). The increase was mainly due to an increase in marketing and advertising expenses related to promotion of our brand-name domestically.

4QFY2013 vs 4QFY2012

Selling and distribution expenses decreased by 22.3% or RMB14.7 million, to RMB51.3 million (4QFY2012: RMB66.0 million), was mainly due a decrease in marketing and advertising expenses related to promotion of our branded-name domestically.

6. Administrative expenses

FY2013 vs FY2012

Administrative expenses increased by 26.1% or RMB25.8 million, to RMB124.5 million (FY2012:RMB98.7 million), was mainly due to (i) an increase in payroll expenses and professional expenses;and (ii) an increase in depreciation expenses allocated for administrative purposes; and (iii) other taxes (such as properties and land use rights taxes), as a result of the Group’s business expansion.


Administrative expenses increased by 104.5% or RMB22.4 million, to RMB43.9 million (4QFY2012:RMB21.5 million), was mainly due to (i) an increase in payroll expenses and professional expenses; and (ii) an increase in depreciation expenses allocated for administrative purposes; and (iii) other taxes (such as properties and land use rights taxes), as a result of the Group’s business expansion.

7. Other expenses

Other expenses comprised mainly the corresponding cost of leasing farmlands to third parties, impairment allowances for trade receivables and exchange losses.

The following table provides a breakdown of our other expenses:

Other expenses FY2013 FY2012 4QFY2013 4QFY2012

RMB’000 RMB’000 RMB’000 RMB’000

Cost of leasing farmlands 26,553 27,027 6,283 6,757

Impairment allowance for trade receivables 11,451 16,977 11,451 16,977

Exchange loss, net 7,786 488 4,833 (846)

Others (1) 5,564 2,589 1,525 (33)

Total 51,354 47,081 24,092 22,855

Note:-(1) Others mainly comprises of costs incurred for corporate social responsibility activities.

III-19


19



8. Financial cost

FY2013 vs FY2012

Our finance cost increased by 33.6% or RMB12.1 million, to RMB47.9 million (FY2012: RMB35.8million). This was due to increase of an average bank borrowing during the year to fund our working capital needs.


Our finance cost decreased by 49.0% or RMB7.5 million, to RMB7.8 million (4QFY2012: RMB15.3million). This was due to decreased of an average bank borrowing during the period to fund our working capital needs.

9. Profit before income tax

FY2013 vs FY2012

Profit before income tax increased by 10.4% or RMB75.7 million, to RMB801.9 million (FY2012:RMB726.2 million), in tandem with higher gross profit. The profit before income tax margin declined by 3.6 ppt, to 24.7% (FY2012: 28.3%) was also in tandem with the declined gross profit margin.


Profit before income tax increased by 0.4% or RMB0.7 million, to RMB171.8 million (4QFY2012:RMB171.1 million) in tandem with the gross profit. The profit before income tax margin remains relatively stable at 21.2% (FY2011: 21.3%).

10. Income tax expense

FY2013 vs FY2012

Income tax expense increased by 0.6% or RMB0.3 million, to RMB46.9 million (FY2012: RMB46.6million).Our effective tax rate decreased to 5.8% (FY2012: 6.4%) due to a higher proportion of our fresh-packed vegetables sales (currently under processed sales business classification) being tax-exempted in the same way as fresh vegetables produce sales.


Income tax expense increased by RMB9.0 million, to RMB9.1 million (4QFY2012: RMB0.1 million) was due to prior year over-accrual for income tax liabilities as of 31 March 2012 (i.e. 9MFY2012), hence the low income tax expenses recognised for 4QFY2012.

III-20


20



11. EBITDA

Our EBITDA increased by 15.4% or RMB148.2 million, to RMB1,110.4 million for the financial year ended 30 June 2012 (FY2012: RMB962.2 million). Our EBITDA increased by 2.3% or RMB5.6 million, to RMB250.6 million for the three months financial period ended 30 June 2012 (4QFY2012: RMB245.0million).

A reconciliation of the net income and EBITDA is as follows:

FY2013RMB’000

FY2012RMB’000

4QFY2013RMB’000

4QFY2012RMB’000

Net income 755,065 679,581 162,659 171,019

Add:

Interest expenses on bank term loans 47,877 35,828 8,185 15,120

Income tax expense 46,858 46,589 9,101 105


Amortisation of land use right 2,751 2,757 621 625

Amortisation of land improvement costs 91,823 64,222 22,883 18,325

Amortisation of operating lease prepayments 67,054 67,693 16,388 16,923

Loss on fair value of biological assets less estimated point-of-sales costs 18,000 8,000 9,000 3,600

EBITDA 1,110,440 962,150 250,588 244,988

EBITDA margins 34.2% 37.5% 30.9% 30.5%

III-21


21


(B) Consolidated Balance Sheet (30 June 2013 vs 30 June 2012)

Non-current assets

Non-current assets increased by approximately 1.8% or RMB52.4 million, to RMB2,980.7 million (30 June 2012: RMB2,928.3 million). This was largely attributable to the capital expenditure on property, plant and equipment for further expansion of our production facilities, net of amortisation and depreciation of non-current assets.

Current assets

Current assets increased by 72.0% or RMB1,195.0 million, to RMB2,854.2 million (30 June 2012:RMB1,659.2 million). This was largely attributable to the (i) increase in our trade receivables,amounting to RMB130.9 million, which was in tandem with revenue growth, and (ii) increase in our other receivables and prepayments, amounting to RMB344.5 million, primarily due to prepayment for construction of industrialized farming facilities; and (iii) increase in our cash and bank balances, amounting to RMB760.2 million, primarily due to prompt receivables collection and proceeds from issuance of new shares. This was offset by the decrease in our inventories and biological assets,amounting to RMB35.7 million.

Non-current liabilities

Non-current liabilities comprised of government grants, long term bank loans and deferred tax liabilities,which decreased by RMB4.2 million to RMB24.4 million (30 June 2012: RMB28.6 million). This waslargely attributable to a long term bank loan being reclassified as a current liability, amortisation of government grants and recognition of deferred tax liabilities.

Current liabilities

Current liabilities comprised mainly bank term loans, income tax liabilities and trade and non-trade payables. Current liabilities increased by 7.1% or RMB68.9 million, to RMB1,040.5 million (30 June 2012: RMB971.6 million). This was primarily due to increase in trade payables by RMB87.6 million,which was in tandem with revenue growth.

Working capital days

Days FY2013 FY2012Trade Receivables Turnover (1) 116 85Trade Payables Turnover (2) (44) (35)Inventory Turnover (3) 21 26Cash Conversion 93 76

Note:-(1) Average trade receivables / revenue X 365 days(2) Average trade payables / cost of goods sold X 365 days(3) Average inventory balance / cost of goods sold for processed products x 365 days

Cash conversion days deteriorated by 17 days, to 93 days (FY2012: 76 days), primarily due to anincrease of trade receivables turnover days by 31 days, and partly offset by an increase in trade payable turnover days by 9 days and an improvement in inventory turnover days by 5 days. In the month of July 2013, the Group collected approximately RMB365 million of trade receivables.

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22


(C) Consolidated Cash Flow Statement

FY2013

We recorded net cash inflow from operating activities of RMB949.4 million. This comprises cash generated from operating activities before changes in working capital of RMB1,109.2 million, net working capital outflow of RMB108.8 million, and net cash outflow amounting to RMB51.0 million from income tax paid and interest received. The net working capital outflow was a result of an increase in trade and other receivables of RMB198.4 million and a decrease in other payables of RMB33.7 million. This was offset by a decrease in inventories and biological assets of RMB35.7 million and increase in trade payables of RMB87.6 million.

We recorded net cash used in investing activities of RMB590.0 million, mainly for construction of industrialized farming facilities.

We recorded net cash inflows from financing activities of RMB390.5 million, which was mainly the net proceeds from the issuance of new shares, amounting to RMB431.5 million. There were also net proceeds from our bank borrowings amounting to RMB19.3 million, together with interest paid ofRMB47.7 million. Lastly, there was a cash outflow of RMB17.1 million towards restricted cash for the securing of notes payable.

4QFY2013

We recorded net cash inflow from operating activities of RMB61.9 million. This comprises cash generated from operating activities before changes in working capital of RMB254.8 million, net working capital outflow of RMB186.5 million, and net cash outflow amounting to RMB6.4 million from income tax paid and interest received. The net working capital outflow was a result of an increase in trade and other receivables of RMB85.3 million and a decrease in trade and other payables of RMB111.3 million.This was offset by a decrease in inventories and biological assets of RMB10.1 million.

We recorded net cash used in investing activities of RMB2.4 million.

We recorded net cash inflows from financing activities of RMB56.8 million, which were mainly the net proceeds from our bank borrowings amounting to RMB47.0 million, together with interest paid ofRMB8.1 million. Lastly, there was a cash inflow of RMB17.9 million towards releasing of restricted cashformerly used to secure of notes payable.

III-23


23

9. Where a forecast, or a prospect statement, has been previously disclosed to shareholders, any variance between it and the actual results.

No forecast had been issued for the financial period under review.

10. A commentary at the date of the announcement of the significant trends and competitive conditions of the industry in which the group operates and any known factors or events that may affect the group in the next reporting period and the next 12 months.

The demand for vegetables remains healthy in the PRC and worldwide, buoyed by rising urbanization as well as preferences for healthy dietary eating habits. With an increased focus on higher value products such as edible fungi, the Group is also riding on the wave of rising affluence in the PRC market. On the overseas front, the Group continues to benefit from the increasing trend of food manufacturers seeking cost competitive and consistent supply of raw materials for their production.

Agriculture remains as one of the key industries favoured and strongly supported by the PRC government. For the 10th consecutive year, the "No. 1 central document" of the PRC government has focused on rural issues, particularly the acceleration of modern agriculture and rural development. The 12th Five Year Plan continues to support large-scale farming through promoting the use of modern technologies in agriculture, mechanization of labour and information management of production.

Capitalising on the growth opportunities, the Group is expanding its industrialized farming footprints in major cities across PRC. With successful track records at its Tianjin and Shanghai cultivation bases, the Group is in the midst of establishing two more industrialized farming bases in Yancheng city, Jiangsu Province and Suining City, Sichuan province respectively. With more labour specialization and lesser labour requirements, industrialized farming is an effective solution to counter rising wages and potential labour shortages on farmland, leading to increased efficiency in the long run.

The Group has also achieved success in the cultivation of champignon mushrooms using industrialized farming methods. Upon further ramp-up in the scale of cultivation, the Group expects to be self sufficient in its champignon mushrooms needs through all-year round in-house cultivation using industrialized farming approach. This also helps to improve the Group's working capital cycle by reducing the need to pay for outsourced contract farming during the peak season. With the successes in king oyster mushrooms and champignon mushrooms, the Group has plans to adopt the industrialized farming methodology for other types of edible fungi and high value crops as well.

Outside of PRC, the Group has also been actively expanding its market presence through tradeshows, marketing campaigns and the setting up of new sales representative offices across the globe. Besides established markets such as Asia, Europe and Americas, the Group is also tapping on new markets such as South Africa and Canada to further fortify its position as a leading worldwide provider of food solutions.

In view of the global economic uncertainty, the Group will also continue its ongoing efforts in closely monitoring the debt and credit situation amongst the European countries, recovery of the U.S. economy and their potential impact on our operations.

III-24


24

11. Dividend

(a) Current Financial Period Reported On

Any dividend declared for the current financial period reported on?

Yes.

First and Final dividendName of Dividend : First and FinalDividend Type : CashDividend Rate : S$0.01 per shareNumber of shares : 655,439,000Tax rate : Tax exempt one-tier

(b) Corresponding Period of the Immediately Preceding Financial Year

Any dividend declared for the corresponding period of the immediately preceding financialyear?

None.

(c) Date payable

To be announced at a later date.

(d) Books closure date

To be announced at a later date.

12. If no dividend has been declared/recommended, a statement to that effect.

Not applicable.

13. Present on-going interested person transactions

As of 30 June 2013, Lin Guo Rong, our Chairman and Executive Director, had providedpersonal guarantees with respect to a loan issued to Fujian Minzhong Organic Food Co.,Ltd., as set forth below:

Expiry date of theguarantee

Amount Guaranteed(‘million)

Drawdown as of30.06.2013 (‘million) Lender

30 December 2014 RMB50.0 - Industrial Bank Co Ltd

N.A. RMB80.0 RMB80.0 OCBC Bank, XiamenBranch

Total RMB130.0 RMB80.0

III-25


25

14. A breakdown of sales as follows:-

FY2013 FY2012 IncreaseRMB’000 RMB’000 %

(a) Sales reported for first half year 1,474,311 1,012,167 45.7%(b) Operating profit after tax reported for first

half year 337,426 267,812 26.0%

(c) Sales reported for second half year 1,773,462 1,556,672 13.9%

(d) Operating profit after tax reported for second half year 417,639 411,769 1.4%

15. Segmented revenue and results for business or geographical segments (of the group) in the form presented in the issuer’s most recently audited annual financial statements, with comparative information for the immediately preceding year.

Operating segments are identified on the basis of internal reports about operating divisions of the Group that are regularly reviewed by the Board of Directors for the purpose of resource allocation and performance assessment.

The Group is organised on a worldwide basis into two main operating divisions, namely:- Processed vegetables, which is the processing and sale of processed vegetables- Fresh vegetables produces, which is the production and sales of fresh vegetable produce- Branded products, which is the production and sales of branded beverages, instant food, and

health food products.

(a) Operating segments

Inter-segment pricing is on arm’s length basis. Unallocated costs represent corporate expenses. Segments assets consist primarily of property, plant, equipment, lease prepayments, inventories, receivables, operating cash and short-term bank deposits. Segments liabilities comprise payables, provisions and borrowings.

(b) Geographical information

The Group operates in two geographical areas:

Singapore – the Company is headquartered and has operations in Singapore. The operations in this area is primarily the investment holding.

People’s Republic of China – the operations in this area are principally the sales of processed products and fresh produce.

Operations in People’s Republic of China contributed 100% of consolidated revenue. Revenue is based on the country in which the customer is located, regardless of where the goods are delivered.Assets and additions to property, plant and equipment are based on the location of those assets.

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26

15. Segmented revenue and results for business or geographical segments (of the group) in the form presented in the issuer’s most recently audited annual financial statements, with comparative information for the immediately preceding year. (Continued)


2013 Processedvegetables

Fresh vegetables produces

Brandedproducts Group

RMB’000 RMB’000 RMB’000 RMB’000Revenue

External sales 1,805,546 1,161,539 280,688 3,247,773

Results 359,910 502,193 19,636 881,739Unallocated expenses (23,425)

Operating profit 858,314Loss on fair value of biological assets less estimated point of sales costs (18,000) (18,000)

Other income 49,389Other expenses (39,903)Financial cost (47,887)

Profit before income tax 801,923

Segment assets 2,167,516 2,349,628 489,212 5,006,356Unallocated assets- Property, plant and equipment 1,537- Other receivables and prepayments 589- Cash and bank balances 826,431

Total assets 5,834,913

Segment liabilities (319,028) (52,198) (36,107) (407,333)Unallocated liabilities- Other payables and accruals (19,270)- Bank term loans (635,646)- Deferred tax liabilities (2,650)

Total liabilities (1,064,899)

Other segment itemsCapital expenditure- Property, plant and equipment 72,768 443,138 84,652 600,558- Land use rights - - - -- Land improvement costs - 5,626 - 5,626Depreciation and amortisation 51,109 180,545 10,986 242,640

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27



2012 Processedvegetables

Fresh vegetables produces

Brandedproducts Group

RMB’000 RMB’000 RMB’000 RMB’000Revenue

External sales 1,456,097 984,576 128,166 2,568,839

Results 288,156 487,062 (15,239) 759,979Unallocated expenses (8,496)

Operating profit 751,483Loss on fair value of biological assets less estimated point of sales costs (8,000) (8,000)

Other income 48,619Other expenses (30,104)Financial cost (35,828)

Profit before income tax 726,170

Segment assets 2,269,687 1,756,449 494,786 4,520,922Unallocated assets- Other receivables and prepayments 364- Cash and bank balances 66,209

Total assets 4,587,495

Segment liabilities (285,733) (55,812) (30,516) (372,061)Unallocated liabilities- Other payables and accruals (11,927)- Bank term loans (616,185)

Total liabilities (1,000,173)

Other segment itemsCapital expenditure- Property, plant and equipment 449,961 - 190,512 640,473- Land use rights 908 - - 908- Land improvement costs - 92,156 - 92,156Depreciation and amortisation 51,392 131,915 8,845 192,152

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(b) Geographical information

Revenue is based on the location of customers.

RevenueFY2013 FY2012

Overseas based customers: RMB’000 RMB’000Americas 104,221 106,505Europe 40,468 38,522Asia (excluding the PRC) and other regions (1) 272,324 280,860Subtotal 417,013 425,887

PRC based customers:Domestic distributors 1,442,228 1,112,741Export distributors 1,388,532 1,030,211

Total revenue 3,247,773 2,568,839

Note (1): These other regions include countries along the Asia-Pacific Rim and other countries such as South Africa and New Zealand.

Non-current assets are mainly based in the PRC.

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29

16. In the review of performance, the factors leading to any material changes in contributions to turnover and earnings by the business or geographical segments.

See paragraphs in 8(A) above.

17. A breakdown of the total annual dividend (in dollar value) for the issuer’s latest full year and its previous full year.

(S$) FY2012 FY2013

First and Final Dividend, proposed - 6,554,390

First and Final Dividend, paid - -

18. Disclosure of person occupying a managerial position in the issuer or any of its principal subsidiaries who is a relative of a director or chief executive officer or substantial shareholder of the issuer pursuant to Rule 704(13) in the format below. If there are no such persons, the issuer must make an appropriate negative statement.

Name Age Family relationship with any director and/or substantial shareholder

Current position and duties, and the year the position was held

Details of changes in duties and position held, if any, during the year.

Huang Shu Fen

40 Wife of Mr Wang Dazhang, the Chief Operations Officer.

Department Supervisor of Fujian Minzhong Organic Food Co., Ltd. In charge of production. Appointed on July 2006.

Not Applicable.

BY ORDER OF THE BOARD

LIN GUO RONGChief Executive Officer 29 August 2013

III-30

APPENDIX IV

RELEVANT ARTICLES IN THE ARTICLES OF ASSOCIATION OF

THE COMPANY

The provisions in the Articles of Association relating to the rights of Shareholders in respect of

capital, dividends and voting have been reproduced below:

SHARES

(6) Subject to the Act, no shares may be issued by the Directors without the

prior approval of the Company in general meeting but subject thereto and to

Article 67, and to any special rights attached to any shares for the time being

issued, the Directors may issue, allot or grant options over or otherwise deal

with or dispose of the same to such persons on such terms and conditions

and at such time and subject or not to the payment of any part of the amount

thereof in cash as the Directors may think fit. Any such shares may be

issued or with such preferential, deferred, qualified or special rights,

privileges or conditions as the Directors may think fit. Preference shares

may be issued which are or at the option of the Company are liable to be

redeemed, the terms and manner of redemption being determined by the

Directors.

Provided always that the foregoing is subject to the following:

(a) the rights attaching to shares of a class other than ordinary shares

shall be expressed in the resolution creating the same; and

(b) where the capital of the Company consists of shares of different

monetary denominations, the voting rights shall be prescribed in such

manner that a unit of capital in each class when reduced to a common

denominator, shall carry the same voting power when such right is

exercisable.

(7) Notwithstanding anything in these Articles, a treasury share shall be subject

to such rights and restrictions as may be prescribed in the Act and may be

dealt with by the Company in such manner as may be permitted by, and in

accordance with, the Act. For the avoidance of doubt, save as expressly

permitted by the Act, the Company shall not be entitled to any rights of a

Member under these Articles.

(8) Without prejudice to any special rights or privileges attached to any then

existing shares, any new shares may be issued upon such terms and

conditions, and with such rights and privileges attached thereto, as the

Company by Ordinary Resolution may direct, or, if no such direction be

given, as the Directors shall determine, and in particular such shares may

be issued with preferential, qualified or deferred right to dividends and in the

distribution of assets of the Company, and with a special or restricted right

of voting, and any preference share may be issued on the terms that it is, or

at the option of the Company is, to be liable to be redeemed. The rights

attached to any such shares issued upon special conditions shall be clearly

defined in these Articles.

Issue of shares

Treasury shares

Creation of

special rights

IV-1

(9) (1) Preference shares may be issued subject to such limitation thereof as

may be prescribed by law or by the listing rules of the Exchange. Preference

shareholders shall have the same rights as ordinary shareholders as

regards receiving of notices, reports and balance sheets and attending

general meetings of the Company. Preference shareholders shall also have

the right to vote at any meeting convened for the purpose of reducing the

capital or winding up or sanctioning a sale of the undertaking of the

Company or where the proposal to be submitted to the meeting directly

affects their rights and privileges or when the dividend on the preference

shares is more than six (6) months in arrears.

(2) The Company has power to issue further preference capital ranking

equally with, or in priority to, preference shares from time to time already

issued or about to be issued.

(10) If at any time the share capital is divided into different classes, the rights

attached to any class (unless otherwise provided by the terms of issue of the

shares of that class) may, subject to the provisions of the Act, whether or not the

Company is being wound up, be varied or abrogated either with the consent in

writing of the holders of three-quarters of the issued shares of the class or with

the sanction of a Special Resolution passed at a separate general meeting of

the holders of shares of the class and to every such Special Resolution the

provisions of Section 184 of the Act shall with such adaptations as are

necessary apply. To every such separate general meeting, the provisions of

these Articles relating to general meetings shall mutatis mutandis apply.

Provided Always That:

(a) the necessary quorum shall be two persons at least holding or

representing by proxy or by attorney one-third of the issued shares of

the class and that any holder of shares of the class present in person

or by proxy or by attorney may demand a poll, but where the necessary

majority for such a Special Resolution is not obtained at the meeting,

consent in writing if obtained from the holders of three-fourths of the

issued shares of the class concerned within two months of the meeting

shall be as valid and effectual as a Special Resolution carried at the

meeting; and

(b) where all the issued shares of the class are held by one person, the

necessary quorum shall be one person and such holder of shares of

the class present in person or by proxy or by attorney may demand a

poll.

(11) The repayment of preference capital other than redeemable preference

capital or any other alteration of preference shareholders’ rights, may only

be made pursuant to a Special Resolution of the preference shareholders

concerned. Provided Always That where the necessary majority for such a

Special Resolution is not obtained at a meeting, consent in writing if

obtained from the holders of three-fourths of the preference shares

concerned within two (2) months of the meeting, shall be as valid and

effectual as a Special Resolution carried at the meeting.

(12) The rights conferred upon the holders of the shares of any class issued with

preferred or other rights shall, unless otherwise expressly provided by the

terms of issue of the shares of that class or by these Articles, be deemed to

be varied by the creation or issue of further shares ranking equally

therewith.

Rights attached

to preference

shares

Issue of further

preference

shares

Variation of

rights of shares

Variation of

rights of

preference

shareholders

Issue of further

shares affecting

special rights

IV-2

(13) If by the conditions of allotment of any shares the whole or any part of the

amount of the issue price thereof shall be payable by instalments every such

instalment shall, when due, be paid to the Company by the person who for

the time being shall be the registered holder of the share or his personal

representatives, but this provision shall not affect the liability of any allottee

who may have agreed to pay the same.

(14) The Company may pay commissions or brokerage on any issue of shares at

such rate or amount and in such manner as the Directors deem fit. Such

commissions or brokerage may be paid in whole or in part in cash or fully or

partly paid shares of the Company. The Company may, in addition to, or in

lieu of, such commission, in consideration of any person so subscribing or

agreeing to subscribe, or of his procuring or agreeing to procure

subscriptions, for any shares in the Company, confer on any such person an

option call within a specified time for a specified number of shares in the

Company at a specified price or on such other terms and conditions as the

Directors may deem fit.

(15) Save to the extent permitted by the Act or the listing rules of the Exchange,

no part of the funds of the Company shall, directly or indirectly, be employed

in the purchase of or subscription for or making of loans upon the security

of any shares (or its holding company, if any). The Company shall not,

except as authorised by the Act, give any financial assistance for the

purpose of or in connection with any purchase of shares in the Company (or

its holding company, if any).

(16) Where any shares are issued for the purpose of raising money to defray the

expenses of the construction of any works or buildings or the provision of

any plant which cannot be made profitable for a lengthened period, the

Company may pay interest on so much of that share capital as is for the time

being paid up for the period (except treasury shares), and, subject to the

conditions and restrictions mentioned in the Section 78 of the Act, may

charge the same to capital as part of the cost of the construction of the

works or building or the provision of the plant.

(17) Except as required by law, no person other than the Depository shall be

recognised by the Company as holding any share upon any trust and the

Company shall not be bound by or compelled in any way to recognise (even

when having notice thereof) any equitable, contingent, future or partial interest

in any share or any interest in any fractional part of a share or (except only as

by these Articles or by law otherwise provided) any other rights in respect of any

share, except an absolute right to the entirety thereof in the person (other than

the Depository) entered in the Register of Members as the registered holder

thereof or (where the person entered in the Register of Members as the

registered holder of a share is the Depository) the person whose name is

entered in the Depository Register in respect of that share. Nothing contained

in this Article relating to the Depository or the Depositors or in any depository

agreement made by the Company with any common depository for shares or in

any notification of substantial shareholding to the Company or in response to a

notice pursuant to Section 92 of the Act or any note made by the Company of

any particulars in such notification or response shall derogate or limit or restrict

or qualify these provisions; and any proxy or instructions on any matter

whatsoever given by the Depository or Depositors to the Company or the

Directors shall not constitute any notification of trust and the acceptance of

such proxies and the acceptance of or compliance with such instructions by the

Company or the Directors shall not constitute the taking of any notice of trust.

Payment of

instalments

Payment of

commission

Company’s

shares as

security

Power to charge

interest on

capital

Company need

not recognise

trust

IV-3

JOINT HOLDERS OF SHARES

(22) Where two (2) or more persons are registered as the holders of any share,

they shall be deemed to hold the same as joint tenants with benefit of

survivorship subject to the following provisions:

(a) The Company shall not be bound to register more than three persons

as the holders of any share, except in the case of executors, trustees

or administrators of the estate of a deceased Member.

(b) The joint holders of a share shall be liable severally as well as jointly

in respect of all payments which ought to be made in respect of such

share.

(c) On the death of any one of such joint holders the survivor or survivors

shall be the only person or persons recognised by the Company as

having any title to such share but the Directors may require such

evidence of death as they may deem fit.

(d) Any one of such joint holders may give effectual receipts for any

dividend payable to such joint holders.

(e) Only the person whose name stands first in the Register of Members

as one of the joint holders of any share shall be entitled to delivery of

the certificate relating to such share or to receive notices from the

Company and any notice given to such person shall be deemed notice

to all the joint holders.

CONVERSION OF SHARES INTO STOCK

(62) The Company in general meeting may convert any paid up shares into stock

and may from time to time reconvert such stock into paid up shares.

(63) When any shares have been converted into stock, the several holders of

such stock may transfer their respective interests therein or any part of such

interests in such manner as the Company in general meeting shall direct,

but in the absence of such direction, the respective interests may be

transferred in the same manner and subject to the same regulations as the

shares from which the stock arose would have been transferred prior to

conversion or as near thereto as circumstances will admit. But the Directors

may if they think fit from time to time fix the minimum number of stock units

transferable.

(64) The holders of stock shall, according to the number of stock units held by

them, have the same rights, privileges and advantages as regards dividend,

return of capital, voting and other matters as if they held the shares from

which the stock arose, but no such privilege or advantage (except as

regards dividend and return of capital and the assets on winding up) shall be

conferred by the number of stock units which would not, if existing in shares,

have conferred that privilege or advantage, and no such conversion shall

affect or prejudice any preference or other special privileges attached to the

shares so converted.

Joint holders

deemed holding

as joint tenants

Limited to 3 joint

holders

Jointly and

severally liable

Survivorship

Receipts

Entitlement to

delivery of share

certificates and

notice

Conversion from

share to stock

and back to

share

Transfer of stock

Rights of

stock-holders

IV-4

(65) All such provisions of these Articles as are applicable to paid up shares shall

apply to stock and in all such provisions the words ‘share’ and ‘shareholder’

shall include ‘stock’ and ‘stockholder’.

ALTERATIONS OF CAPITAL

(66) Subject to any special rights for the time being attached to any existing class

of shares, any new shares shall be issued upon such terms and conditions

and with such rights and privileges annexed thereto as the general meeting

resolving upon the creation thereof shall direct, and if no direction be given,

as the Directors shall determine, and in particular, such new shares may be

issued with a preferential or qualified right to dividends and in the

distribution of the assets of the Company and with a special or restricted

right of voting.

(67) (1) The Company may from time to time by Ordinary Resolution increase

its capital by such sum to be divided into shares of such amounts as the

resolution shall prescribe.

(2) Subject to any direction to the contrary that may be given by the

Company in general meeting or except as permitted under the listing rules

of the Exchange, all new shares shall before issue be offered to such

Members as are, at the date of the offer, entitled to receive notices from the

Company of general meetings in proportion, as nearly as the circumstances

admit, to the amount of the existing shares to which they are entitled or hold.

The offer shall be made by notice specifying the number of shares offered,

and limiting a time within which the offer, if not accepted, will be deemed to

be declined, and, after the expiration of that time, or on the receipt of an

intimation from the person to whom the offer is made that he declines to

accept the shares offered, the Directors may dispose of those shares in

such manner as they think most beneficial to the Company. The Directors

may likewise so dispose of any new shares which (by reason of the ratio

which the new shares bear to shares held by persons entitled to an offer of

new shares), in the opinion of the Directors, cannot be conveniently offered

under this Article.

(3) Notwithstanding Article 67(2), the Company may by Ordinary

Resolution in General Meeting give to the Directors a general authority,

either unconditionally or subject to such conditions as may be specified in

the Ordinary Resolution, to:–

(a) (i) issue shares in the capital of the Company whether by way of

rights, bonus or otherwise; and/or

(ii) make or grant offers, agreements or options (collectively,

“Instruments”) that might or would require shares to be issued,

including but not limited to the creation and issue of (as well as

adjustments to) warrants, debentures or other instruments

convertible into shares; and

(b) notwithstanding that the authority conferred by the Ordinary Resolution

may have ceased to be in force, the Directors may issue shares in

pursuance of any Instrument made or granted while the Ordinary

Resolution was in force,

Interpretation

Rights and

privileges of new

shares

Power to

increase capital

Issue of new

shares

IV-5

provided that:–

(1) the aggregate number of shares to be issued pursuant to the Ordinary

Resolution (including shares to be issued in pursuance of Instruments made

or granted pursuant to the Ordinary Resolution) shall be subject to such

limits and manner of calculation as may be prescribed by the Exchange;

(2) in exercising the authority conferred by the Ordinary Resolution, the

Company shall comply with the provisions of the listing rules of the

Exchange for the time being in force (unless such compliance is waived by

the Exchange) and these Articles; and

(3) (unless revoked or varied by the Company in General Meeting) the

authority conferred by the Ordinary Resolution shall not continue in force

beyond the conclusion of the Annual General Meeting of the Company next

following the passing of the Ordinary Resolution, or the date by which such

Annual General Meeting of the Company is required by law to be held, or the

expiration of such other period as may be prescribed by the Act (whichever

is the earliest).

(68) Notwithstanding Article 67 above but subject to the Act, the Directors shall

not be required to offer any new shares to Members to whom by reason of

foreign securities laws such offers may not be made without registration of

the shares or a prospectus or other document, but may sell the entitlements

to the new shares on behalf of such Members in such manner as they think

most beneficial to the Company.

(69) Subject to any directions that may be given in accordance with the powers

contained in the Memorandum of Association of the Company or these

Articles, any capital raised by the creation of new shares shall be considered

as part of the original capital and as consisting of ordinary shares and shall

be subject to the same provisions with reference to the payment of calls,

transfer, transmission, forfeiture, lien and otherwise as if it had been part of

the original capital.

(70) (1) The Company may by Ordinary Resolution:

(a) consolidate and divide all or any of its shares;

(b) subdivide its shares or any of them (subject nevertheless to the

provisions of the Act) provided always that in such subdivision the

proportion between the amount paid and the amount (if any)

unpaid on each reduced share shall be the same as it was in the

case of the share from which the reduced share is derived;

(c) cancel any shares which, at the date of the passing of the

resolution, have not been taken, or agreed to be taken, by any

person and diminish the amount of its capital by the amount of the

shares so cancelled; or

(d) subject to the provisions of these Articles and the Act, convert any

class of shares into any other class of shares.

Capital raised

deemed original

capital

Power to

consolidate,

cancel and sub-

divide shares

IV-6

(2) Subject to and in accordance with the provisions of the Act, the listing

rules of the Exchange and any applicable legislation or regulation, the

Company may authorise the Directors in general meeting to purchase or

otherwise acquire ordinary shares, stocks, preference shares, options,

debentures, debenture stocks, bonds, obligations, securities, and all other

equity, derivative, debt and financial instruments issued by it on such terms

on such terms as the Company may think fit and in the manner prescribed

by the Act. The Company may deal with any such share which is so

purchased or acquired by the Company in such manner as may be permitted

by, and in accordance with, the Act (including without limitation, to hold such

share as a treasury share).

(71) The Company may reduce its share capital or any undistributable reserve in

any manner, subject to any requirements and consents required by law.

Without prejudice to the foregoing, upon cancellation of shares purchased

or otherwise acquired by the Company pursuant to these Articles and the

Act, the number of issued shares of the Company shall be diminished by the

number of shares so cancelled, and where any such cancelled shares were

purchased or acquired out of the capital of the Company, the amount of the

share capital of the Company shall be reduced accordingly.

GENERAL MEETINGS

(72) The Company shall in each calendar year hold a general meeting as its

annual general meeting in addition to any other meetings in that year and

shall specify the meeting as such in the notices calling it. Not more than

fifteen (15) months shall elapse between the date of one annual general

meeting and that of the next. The annual general meeting shall be held at

such time and place as the Directors shall determine.

(73) All general meetings other than annual general meetings shall be called

extraordinary general meetings.

(74) The Directors may whenever they think fit convene an extraordinary general

meeting and an extraordinary general meeting shall also be convened on

such requisition by Members in accordance with the Act or in default may be

convened by such requisitionist as provided for under the Act. If at any time

there are not within Singapore sufficient Directors capable of action to form

a quorum at a meeting of Directors, any Director may convene an

extraordinary general meeting in the same manner as nearly as possible as

that in which such a meeting may be convened by the Directors.

(75) The time and place of any meeting shall be determined by the convenors of

the meeting.

NOTICE OF GENERAL MEETINGS

(76) Any general meeting at which it is proposed to pass Special Resolutions or a

resolution of which special notice has been given to the Company pursuant to

the Act, shall be called by at least twenty-one (21) clear days’ notice in writing.

An annual general meeting or any other general meeting shall be called by at

least fourteen (14) clear days’ notice in writing. The notice must specify the

place, the day and the hour of the meeting, and in the case of special

business the general nature of such business. Such notice shall be given in

the manner hereinafter mentioned to such persons as are under the

Power to

purchase or

acquire shares.

Reduction of

share capital

Annual general

meetings

Extraordinary

general meetings

Calling for

extraordinary

general meetings

Time and place

of meeting

Length of notice

Contents of

notice

IV-7

provisions of these Articles entitled to receive notices of general meetings

from the Company, but with the consent of all persons for the time being

entitled as aforesaid, a meeting may be convened in such manner as such

persons may approve. The notice shall be exclusive of the day on which it is

served or deemed to be served and of the day for which it is given.

Subject to the provisions of the Act, notwithstanding that it has been called

by a shorter notice than that specified above, a general meeting shall be

deemed to have been duly called if it is agreed:

(a) in the case of an annual general meeting by all the Members entitled

to attend and vote thereat; and

(b) in the case of an extraordinary general meeting by a majority in number of

the Members having a right to attend and vote thereat, being a majority

together holding not less than ninety-five per cent (95%) of the total voting

rights of all the Members having a right to vote at that meeting.

Provided also that the accidental omission to give notice of a meeting to, or

the non-receipt of notice of a meeting by, any person entitled to receive

notice shall not invalidate the proceedings at the meeting.

So long as the shares of the Company are listed on the Exchange, at least

fourteen (14) days’ notice of every general meeting shall be given by

advertisement in the daily press and in writing to the Exchange and to each

stock exchange upon which the Company is listed.

(77) Notice of every general meeting shall be given in any manner authorised by

these Articles to:

(a) every Member holding shares conferring the right to attend and vote at

the meeting who at the time of the convening of the meeting shall have

paid all calls or other sums presently payable by him in respect of

shares;

(b) every person entitled to a share in consequence of the death or

bankruptcy or otherwise of a Member who but for the same would be

entitled to receive notice of the meeting;

(c) every Director;

(d) the Auditors of the Company, without prejudice to Article 183; and

(e) the Exchange.

No other person shall be entitled to receive notices of general meetings;

Provided Always That if the meeting is called for the alteration of the objects

of the Company, the notice shall comply with the provisions of Section 33 of

the Act regarding notices to debenture holders.

(78) There shall appear with reasonable prominence in every such notice a statement

that a Member entitled to attend and vote is entitled to appoint a proxy to attend

and to vote instead of him and that a proxy need not be a Member.

Shorter notice

Accidental

omission

Form of notice

and to whom to

be given

Notice to state

that Member can

appoint proxy

IV-8

(79) All business shall be deemed special that is transacted at an extraordinary

general meeting and also all that is transacted at an annual general meeting

with the exception of the consideration of the accounts, balance sheets and

reports (if any) of the Directors and Auditor of the Company, the election of

Directors in place of those retiring by rotation or otherwise, the fixing of the

remuneration of Directors, the declaration of dividends, and the appointment

of and the fixing of the remuneration of the Auditor of the Company, which

shall be deemed routine business. Any notice of a meeting called to consider

special business shall be accompanied by a statement regarding the effect

of any proposed resolution in respect of such special business.

(80) In the case of any general meeting at which business other than routine

business is to be transacted (special business), the notice shall specify the

general nature of the special business, and if any resolution is to be

proposed as a Special Resolution or as requiring special notice, the notice

shall contain a statement to that effect.

PROCEEDINGS AT GENERAL MEETINGS

(81) No business other than the appointment of a chairman shall be transacted

at any general meeting unless a quorum of Members is present at the time

when the meeting proceeds to business. Except as herein otherwise

provided, two (2) Members present in person shall form a quorum. For the

purposes of this Article, ‘Member’ includes a person attending as a proxy

and a corporation being a Member shall be deemed to be personally present

if represented in accordance with the provisions of Section 179(3) of the Act.

Provided that (i) a proxy representing more than one Member shall only

count as one Member for the purpose of determining the quorum; and (ii)

where a Member is represented by more than one proxy such proxies shall

count as only one Member for the purpose of determining the quorum.

(82) If within half an hour from the time appointed for the holding of a general

meeting a quorum is not present, the meeting if convened on the requisition

of Members shall be dissolved. In any other case, it shall stand adjourned

to the same day in the next week at the same time and place or to such other

day and at such other time and place as the Directors may determine, and

if at such adjourned meeting a quorum is not present within half an hour from

the time appointed for holding the meeting, the meeting shall be dissolved.

(83) The Chairman of the Board or, in his absence, the Deputy Chairman (if any)

shall preside as Chairman at every general meeting, but if there be no such

Chairman or Deputy Chairman, or if at any meeting he shall not be present

within fifteen (15) minutes after the time appointed for holding the same, or shall

be unwilling to act as Chairman, the Members present shall choose some

Director, or if no Director be present, or if all the Directors present decline to

take the chair, one of themselves to be Chairman of the meeting.

(84) The Chairman of the meeting may, with the consent of any meeting at which

a quorum is present, and shall, if so directed by the meeting, adjourn the

meeting from time to time and from place to place (or sine die), but no

business shall be transacted at any adjourned meeting other than the

business left unfinished at the meeting from which the adjournment took

place. Where a meeting is adjourned sine die, the time and place for the

adjourned meeting shall be fixed by the Directors. When a meeting is

adjourned for fourteen (14) days or more, notice of the adjourned meeting

All business

deemed special

business

Notice to specify

nature of special

business

Quorum

Adjournment if

quorum not

present

Chairman

Adjournment by

chairman

IV-9

shall be given as in the case of an original meeting. Save as aforesaid it

shall not be necessary to give notice of an adjournment or of the business

to be transacted at an adjourned meeting.

(85) At any general meeting a resolution put to the vote of the meeting shall be

decided on a show of hands unless, subject to Article 89, a poll is demanded

either before or on the declaration of the result by the show of hands:

(a) by the Chairman of the meeting; or

(b) by at least two Members present in person or by proxy (where a

Member has appointed more than one proxy, any one of such proxies

may represent that Member) or attorney or in the case of a corporation

by a representative, and entitled to vote thereat; or

(c) by any Member or Members present in person or by proxy (where a



by a representative or any number or combination of such Members,

holding or representing not less than one-tenth of the total voting rights

of all the Members having the right to vote at the meeting; or

(d) by any Member or Members present in person or by proxy (where a



by a representative or any number or combination of such Members,

holding or representing shares conferring a right to vote at the meeting,

being shares on which an aggregate sum has been paid up equal to not

less than ten per cent (10%) of the total sum paid up on all the shares

conferring that right.

Unless a poll is so demanded (and the demand is not withdrawn) a

declaration by the Chairman that a resolution has been carried or carried

unanimously or by a particular majority or lost and an entry to that effect in

the minute book shall be conclusive evidence of the fact without proof of the

number or proportion of the votes recorded in favour of or against the

resolution. A demand for a poll may be withdrawn.

(86) In the case of an equality of votes whether on a show of hands or on a poll

as aforesaid, the Chairman shall be entitled to a second or casting vote in

addition to the vote or votes to which he may be entitled as a Member or as

a proxy of a Member.

(87) If a poll is demanded as aforesaid, it shall be taken in such manner and at

such time and place as the Chairman of the meeting directs and either at

once or after an interval or adjournment or otherwise and the result of the

poll shall be deemed to be the resolution of the meeting at which the poll was

demanded. No notice need be given of a poll not taken at once. In case of

any dispute as to the admission or rejection of a vote, the Chairman shall

determine the same and such determination made in good faith shall be final

and conclusive.

Method of voting

Equality of votes

Time for taking a

poll

IV-10

(88) If a poll is duly demanded (and the demand is not withdrawn) it shall be

taken in such manner (including the use of ballot or voting papers or tickets)

as the Chairman may direct and the result of such a poll shall be deemed to

be the resolution of the meeting at which the poll was demanded. The

Chairman may, and if so requested shall, appoint scrutineers and may

adjourn the meeting to some place and time fixed by him for the purpose of

declaring the result of the poll.

(89) The demand for a poll shall not prevent the continuance of a meeting for the

transaction of any business other than the question on which a poll has been

demanded.

(90) No poll shall be demanded on the election of a Chairman of a meeting or on

a question of adjournment.

(91) If at any general meeting any votes shall be counted which ought not to have

been counted or might have been rejected, the error shall not vitiate the

result of the vote unless it is pointed out at the same meeting, and is in the

opinion of the Chairman of sufficient magnitude to vitiate the result of the

voting.

(92) The Members may, if the Directors at their absolute discretion deem fit,

participate at a general meeting by telephone or video conference or by

means of similar communication equipment whereby all persons

participating in the meeting are able to hear and, if applicable, see each

other and such participation shall constitute presence in person at such

meeting and Members (or their proxy or, in the case of a corporation, their

respective corporate representatives) so participating shall be counted in

the quorum for the meeting. Such a meeting shall be deemed to take place

where the largest group of Members (or their proxy, or in the case of a

corporation, their respective corporate representatives) present for

purposes of the meeting is assembled or, if there is no such group, where

the Chairman of the meeting is present.

VOTES OF MEMBERS

(93) (1) Subject and without prejudice to any special privileges or restrictions

as to voting for the time being attached to any special class of shares for the

time being forming part of the capital of the Company, each Member entitled

to vote may vote in person or by proxy or attorney, and (in the case of a

corporation) by a representative. A person entitled to more than one vote

need not use all his votes or cast all the votes he uses in the same way.

(2) On a show of hands every Member who is present in person or by proxy

or attorney, or in the case of a corporation by a representative, shall have

one vote provided that if a Member is represented by two proxies, without

prejudice to specific terms of Article 98 only one of the two proxies as

determined by their appointor shall vote on a show of hands and in the

absence of such determination, only one of the two proxies as determined

by the Chairman (or by a person authorised by him) shall vote on a show of

hands and on a poll, every Member who is present in person or by proxy,

attorney or representative shall have one vote for each share which he holds

or represents.

Method of taking

poll

Continuance of

business

No poll

Error in counting

votes

Meetings via

electronic means

Voting rights of

Members

IV-11

(3) Notwithstanding anything contained in these Articles, a Depositor shall

not be entitled to attend any general meeting and to speak and vote thereat

unless his name is certified by the Depository to the Company as appearing

on the Depository Register not later than 48 hours before that general

meeting (the ‘cut-off time’) as a Depositor on whose behalf the Depository

holds shares. For the purpose of determining the number of votes which a

Depositor or his proxy may cast on a poll, the Depositor or his proxy shall be

deemed to hold or represent that number of shares entered in the

Depositor’s Securities Account at the cut-off time as certified by the

Depository to the Company, or where a Depositor has apportioned the

balance standing to his Securities Account as at the cut-off time between

two proxies, to apportion the said number of shares between the two proxies

in the same proportion as specified by the Depositor in appointing the

proxies; and accordingly no instrument appointing a proxy of a Depositor

shall be rendered invalid merely by reason of any discrepancy between the

number of shares standing to the credit of that Depositor’s Securities

Account as at the cut-off time, and the true balance standing to the

Securities Account of a Depositor as at the time of the relevant general

meeting, if the instrument is dealt with in such manner as aforesaid.

(94) If any Member be a lunatic, idiot or non compos mentis he may vote by his

committee, curator bonis or other legal curator and such last mentioned

persons may give their votes by proxy, but no person claiming to vote

pursuant to this Article shall do so unless such evidence as the Directors

may require of his authority shall have been deposited at the Office not less

than forty-eight (48) hours before the time for holding the meeting at which

he wishes to vote.

(95) If two (2) or more persons are jointly entitled to a share then in voting upon

any question, the vote of the senior who tenders a vote, whether in person

or by proxy, shall be accepted to the exclusion of the votes of the other

registered holders of the share and for this purpose seniority shall be

determined by the order in which the names stand in the Register of

Members or the Depository Register (as the case may be). Several

executors or administrators of a deceased Member in whose name any

share stands shall for the purpose of this Article be deemed joint holders

thereof.

(96) Save as expressly provided herein or in the Act, no person other than a

Member duly registered, and only in respect of shares upon which all calls

due to the Company have been paid, shall be entitled to be present or to

vote on any question, either personally or by proxy, attorney or

representative at any general meeting.

(97) Any instrument appointing a proxy shall be in writing in the common form

approved by the Directors under the hand of the appointor or his attorney

duly authorised in writing or, if the appointor is a corporation, under seal or

under the hand of its attorney duly authorised and the Company shall accept

as valid in all respects the form of proxy approved by the Directors for use

at the date relevant to the general meeting in question. The instrument

appointing a proxy shall be deemed to confer authority generally to act at the

meeting for the Member giving the proxy.

(98) (1) A Member may not appoint more than two proxies to attend and vote at

the same general meeting. A proxy or attorney need not be a Member.

Voting rights of

Members of

unsound mind

Voting rights of

joint holders

Right to vote

Instrument of

proxy

Appointment of

proxies

IV-12

(2) If the Member is a Depositor, the Company shall be entitled:

(a) to reject any instrument of proxy lodged if the Depositor is not

shown to have any shares entered in its Securities Account as at

the cut-off time (as defined in Article 93(3)) as certified by the

Depository to the Company; and

(b) to accept as validly cast by the proxy or proxies appointed by the

Depositor on a poll that number of votes which corresponds to or

is less than the aggregate number of shares entered in the

Securities Account of that Depositor as at the cut-off time as

certified by the Depository to the Company, whether that number

is greater or smaller than the number specified in any instrument

of proxy executed by or on behalf of that Depositor.

(3) Where a Member appoints more than one proxy, he shall specify the

proportion of his shareholding to be represented by each proxy. If no such

proportion or number is specified the first named proxy may be treated as

representing 100% of the shareholding and any subsequent named proxy as

an alternate to the earlier named.

(4) Voting right(s) attached to any shares in respect of which a Member

has not appointed a proxy may only be exercised at the relevant general

meeting by the Member personally or by his attorney, or in the case of a

corporation by its representative.

(5) Where a Member appoints a proxy in respect of more shares than the

shares standing to his name in the Register of Members, or in the case of

a Depositor, standing to the credit of his Securities Account, such proxy may

not exercise any of the votes or rights of shares not registered to the name

of that Member in the Register of Members or standing to the credit of that

Depositor’s Securities Account as the case may be, as at the cut-off time.

(99) An instrument appointing a proxy shall, unless the contrary is stated

thereon, be valid as well for any adjournment of the meeting as for the

meeting to which it relates and need not be witnessed.

(100) The instrument appointing a proxy and the power of attorney or other

authority, if any, under which it is signed or a notarially certified copy of such

power or authority shall be deposited at the Office or at such other place

within Singapore as is specified for that purpose in the notice convening the

meeting at least forty-eight (48) hours before the time appointed for holding

the meeting or adjourned meeting as the case may be; otherwise the person

so named shall not be entitled to vote in respect thereof unless the Directors

otherwise determine.

(101) Unless otherwise directed by the Chairman of the meeting, a vote given in

accordance with the terms of an instrument of proxy shall be treated as valid

notwithstanding the previous death or insanity of the principal or revocation

of the proxy or of the authority under which the proxy was executed or the

transfer of the share in respect of which the proxy is given; Provided Always

That no intimation in writing of such death, insanity, revocation or transfer as

Instrument

appointing proxy

valid at

adjourned

meeting

Deposit of

instrument of

proxy

Intervening death

or insanity of

Member

IV-13

aforesaid shall have been received by the Company at the Office before the

commencement of the meeting or adjourned meeting at which the proxy is

used.

(102) Any corporation which is a Member may by resolution of its Directors or

other governing body authorise such person as it thinks fit to act as its

representative at any meeting of the Company or of any class of Members

and the persons so authorised shall be entitled to exercise the same powers

on behalf of the corporation as the corporation could exercise if it were an

individual Member. The Company shall be entitled to treat a certificate under

the seal of the corporation as conclusive evidence of the appointment or

revocation of appointment of a representative under this Article.

(103) No objection shall be raised to the qualification of any voter except at the

meeting or adjourned meeting at which the vote objected to is given or

tendered and every vote not disallowed at such meeting shall be valid for all

purposes. Any such objection made in due time shall be referred to the

Chairman of the meeting whose decision as to its validity shall be final and

conclusive.

DIVIDENDS AND RESERVES

(160) Subject to any rights or restrictions attached to any shares or class of shares

and except as otherwise permitted by the Act, (a) all dividends shall be

declared and paid in proportion to the number of shares held by a Member

but where shares are partly paid all dividends must be apportioned and paid

proportionately to the amounts paid or credited as paid on the partly paid

shares; and (b) all dividends shall be apportioned and paid proportionately

to the amounts so paid or credited as paid during any portion or portions of

the period in respect of which the dividend is paid, but if any share is issued

on terms providing that it shall rank for dividend as from a particular date

such share shall rank for dividend accordingly. For the purposes of this

Article, no amount paid or credited as paid on a share in advance of a call

shall be treated as paid on the share.

(161) The Directors may, from time to time, set aside out of the profits of the

Company and carry to reserve, such sum or sums as they think proper which

shall, at the discretion of the Directors, be applicable for meeting

contingencies, for the gradual liquidation of any debt or liability of the

Company, for repairing or maintaining any works connected with the

business of the Company, for equalising dividends, for distribution by way of

special dividend or bonus or for any other purpose to which the profits of the

Company may properly be applied and pending such application, may either

be employed in the business of the Company or be invested. The Directors

may divide the reserve fund into such special funds or any parts of any

special funds into which the reserve may have been divided. The Directors

may also, without placing the same to reserve, carry forward any profits

which they may think prudent not to divide.

(162) The Directors may, with the sanction of an Ordinary Resolution at a general

meeting, from time to time declare dividends, but no such dividend shall

(except as by the Statutes expressly authorised) be payable otherwise than

out of the profits of the Company. No higher dividend shall be paid than is

recommended by the Directors and a declaration by the Directors as to the

amount of the profits at any time available for dividends shall be conclusive.

Corporations

acting via

representative

Objections

Apportionment of

dividends

Power to set

aside profits as

reserve

Declaration and

payment of

dividends

IV-14

The Directors may, if they think fit, and if in their opinion the profits of the

Company justifies such payment, without any such sanction as aforesaid,

from time to time declare and pay fixed preferential dividends on any class

of shares carrying a fixed preferential dividend expressed to be payable on

a fixed date on the half-yearly or other dates (if any) prescribed for the

payment thereof by the terms of issue of the shares, and may also from time

to time pay to the holders of any class of shares interim dividends of such

amounts and on such dates as they may think fit.

(163) With the sanction of an Ordinary Resolution at a general meeting, dividends

may be paid wholly or in part in specie, and may be satisfied in whole or in

part by the distribution amongst the Members in accordance with their rights

of fully paid shares, stock or debentures of any other company, or of any

other property suitable for distribution as aforesaid. The Directors shall have

full liberty to make all such valuations, adjustments and arrangements, and

to issue all such certificates or documents of title as in their opinion may be

necessary or expedient. In particular, they may issue fractional certificates

and fix the value for distribution of such specific assets, or any part thereof,

and may determine that cash payments shall be made to any Members in

terms of the value so fixed, in order to adjust the rights of all parties. The

Directors may vest any such specific assets in trustees as may seem

expedient to the Directors and no valuation, adjustment or arrangement so

made shall be questioned by any Member.

(164) (1) Whenever the Directors or the Company in general meeting have

resolved or proposed that a dividend (including an interim, final, special or

other dividend) be paid or declared on the ordinary share capital of the

Company, the Directors may further resolve that members entitled to such

dividend be entitled to elect to receive an allotment of ordinary shares

credited as fully paid in lieu of cash in respect of the whole or such part of

the dividend as the Directors may think fit. In such case, the following

provisions shall apply:

(a) the basis of any such allotment shall be determined by the Directors;

(b) the Directors shall determine the manner in which Members shall be

entitled to elect to receive an allotment of ordinary shares credited as

fully paid in lieu of cash in respect of the whole or such part of any

dividend in respect of which the Directors shall have passed such a

resolution as aforesaid. The Directors may make such arrangements

as to the giving of notice to Members, providing for forms of election for

completion by Members (whether in respect of a particular dividend(s)

or generally), determining the procedure for making such elections or

revoking the same and the place at which and the latest date and time

by which any forms of election or other documents by which elections

are made or revoked must be lodged, and otherwise make all such

arrangements and do all such things, as the Directors consider

necessary or expedient in connection with the provisions of this Article;

(c) the right of election may be exercised in respect of the whole of that

portion of the dividend in respect of which the right of election has been

accorded, provided that the Directors may determine, either generally

or in specific cases, that such right shall be exercisable in respect of

the whole or any part of that portion; and

Interim dividends

Payment of

dividends in

specie

Scrip Dividends

IV-15

(d) the dividend (or that part of the dividend in respect of which a right of

election has been accorded) shall not be payable in cash on ordinary

shares in respect of which the share election has been duly exercised

(the “elected ordinary shares”) and in lieu of cash and in satisfaction

thereof ordinary shares shall be allotted and credited as fully paid to

the holders of the elected ordinary shares on the basis of allotment

determined as aforesaid. For such purpose, and notwithstanding the

provisions of Article 173, the Directors shall (i) capitalise and apply the

amount standing to the credit of any of the Company’s reserve

accounts or any sum standing to the credit of the profit and loss

account or otherwise available for distribution as the Directors may

determine, such sums as may be required to pay up in full (to the

nominal value thereof) the appropriate number of ordinary shares for

allotment and distribution to and among the holders of the elected

ordinary shares on such basis, or (ii) apply the sum which would

otherwise have been payable in cash to the holders of the elected

ordinary shares towards payment of the appropriate number of

ordinary shares for allotment and distribution to and among the holders

of the elected ordinary shares on such basis.

(2) (a) The ordinary shares allotted pursuant to the provision of

paragraph (1) of this Article shall rank pari passu in all respects with the

ordinary shares then in issue save only as regards participation in the

dividend which is the subject of the election referred to above

(including the right to make the election referred to above) or any other

distributions, bonuses or rights paid, made, declared or announced

prior to or contemporaneous with the payment or declaration of the

dividend which is the subject of the election referred to above, unless

the Directors shall otherwise specify.

(b) The Directors may do all acts and things considered necessary or

expedient to give effect to any capitalisation pursuant to the provisions

of paragraph (1) of this Article, with full power to make such provisions

as they may think fit in the case of fractional entitlements to shares

(including, notwithstanding any provision to the contrary in these

presents, provisions whereby, in whole or in part, fractional

entitlements a re disregarded or rounded up or down, or whereby the

benefit of fractional entitlements accrues to the Company rather than

the Members).

(3) The Directors may, on any occasion when they resolve as provided in

paragraph (1) of this Article, determine that the rights of election under that

paragraph shall not be made available to the persons who are registered as

holders of ordinary shares in the Register of Members or (as the case may

be) in the Depository Register, or in respect of ordinary shares the transfer

of which is registered, after such date as the Directors may fix subject to

such exceptions as the Directors think fit and, in such event, the provisions

of this Article shall be read and construed subject to such determination.

(4) The Directors may, on any occasion when they resolve as provided in

paragraph (1) of this Article, further determine that no allotment of shares or

rights of election for shares under that paragraph shall be made available or

made to a Member whose registered addresses entered in the Register of

Members (or as the case may be) the Depository Register is outside

Singapore or to such other Members or class of Members as the Directors

Ranking of

shares and other

actions

Record date

Cash in lieu of

shares

IV-16

may in their sole discretion decide and, in such event, the only entitlements

of the Members aforesaid shall be to receive in cash the relevant dividend

resolved or proposed to be paid or declared.

(5) Notwithstanding the foregoing provisions of this Article, if at any time

after the Directors’ resolution to apply the provisions of paragraph (1) of this

Article in relation to any dividend but prior to the allotment of ordinary shares

pursuant thereto, the Directors shall consider that, by reason of any event or

circumstances (whether arising before or after such resolution) or by reason

of any matter whatsoever, it is no longer expedient or appropriate to

implement that proposal, the Directors may at their absolute discretion and

as they deem fit in the interests of the Company, cancel the proposed

application of paragraph (1) of this Article.

(165) No shareholder shall be entitled to receive any dividend or to be present or

vote at any meeting or upon a poll, or to exercise any privilege as a Member

until he shall have paid all calls for the time being due and payable on every

share held by him, whether alone or jointly with any other person, together

with interest and expenses (if any).

(166) The Directors may deduct from any dividend or other moneys payable to a

Member in respect of any share held by such Member, either alone or jointly with

any other Member, any or all sums of money as may be due and payable by him,

either alone or jointly with any other person in respect of any debts, liabilities or

engagements to the Company on account of calls or otherwise towards

satisfaction (in whole or in part) of such debts, liabilities or engagements, or any

other account which the Company is required by law to deduct.

(167) A transfer of a share shall not pass the right to any dividend declared in

respect thereof before the transfer has been registered.

(168) The Directors may retain any dividend or other moneys payable on or in

respect of a share on which the Company has a lien and may apply the same

in or towards satisfaction of the debts, liabilities or engagements in respect

of which the lien exists.

(169) The Directors may retain the dividends payable on shares in respect of

which any person is under these Articles, as to the transmission of shares,

entitled to become a Member, or which any person under these Articles is

entitled to transfer, until such person shall become a Member in respect of

such shares or shall duly transfer the same.

(170) Any dividend or other moneys payable in cash in respect of a share may be

paid by cheque or warrant sent through the post to the registered address of

the Member or person entitled thereto (or, if several persons are registered as

joint holders of the share or are entitled thereto in consequence of the death

or bankruptcy of the holder, to any one of such persons) or to such person and

such address as such persons may in writing direct. Provided that where the

Member is a Depositor, the payment by the Company to the Depository of any

dividend payable to a Depositor shall to the extent of the payment discharge

the Company from any further liability in respect of the payment. Every such

cheque or warrant shall be made payable to the order of the person to whom

it is sent or to such person as the holder or joint holders or person or persons

entitled to the share in consequence of the death or bankruptcy of the holder

may direct and payment of the cheque if purporting to be endorsed or the

Cancellation

No right to

dividends where

calls outstanding

Deduction from

debts due to

Company

Effect of transfer

of shares

Retention of

dividends on

shares subject to

lien

Retention of

dividends on

shares pending

transmission

Dividend paid by

cheque or

warrant

IV-17

receipt of any such person shall be a good discharge to the Company. Every

such cheque or warrant shall be sent at the risk of the person entitled to the

money represented thereby.

(171) The payment by the Directors of any unclaimed dividends or other moneys

payable on or in respect of a share into a separate account shall not

constitute the Company a trustee in respect thereof. All dividends unclaimed

after being declared may be invested or otherwise made use of by the

Directors for the benefit of the Company and any dividend unclaimed after

a period of six (6) years from the date of declaration of such dividend may

be forfeited and if so shall revert to the Company. However, the Directors

may at any time thereafter at their absolute discretion annul any such

forfeiture and pay the dividend so forfeited to the person entitled thereto

prior to the forfeiture. If the Depository returns any such dividend or moneys

to the Company, the relevant Depositor shall not have any right or claim in

respect of such dividend or moneys against the Company if a period of six

(6) years has elapsed from the date of the declaration of such dividend or

the date on which such other moneys are first payable. For the avoidance of

doubt no Member shall be entitled to any interest, share of revenue or other

benefit arising from any unclaimed dividends, howsoever and whatsoever.

(172) No dividend shall bear interest as against the Company.

BONUS ISSUES AND CAPITALISATION OF PROFITS AND RESERVES

(173) The Company may, upon the recommendation of the Directors, with the

sanction of an Ordinary Resolution (including any Ordinary Resolution

passed pursuant to Article 67(3)):

(a) issue bonus shares for which no consideration is payable to the

Company to the persons registered as holders of shares in the Register

of Members or (as the case may be) in the Depository Register at the

close of business on:

(i) the date of the Ordinary Resolution (or such other date as may be

specified therein or determined as therein provided); or

(ii) (in the case of an Ordinary Resolution passed pursuant to Article

67(3)) such other date as may be determined by the Directors,

in proportion to their then holdings of shares; and/or

(b) capitalise any part of the amount for the time being standing to the

credit of the Company’s reserve funds or to the credit of the profit and

loss account or otherwise available for distribution, to the persons

registered as holders of shares in the Register of Members or (as the

case may be) in the Depository Register at the close of business on:

(i) the date of the Ordinary Resolution (or such other date as may be

specified therein or determined as therein provided); or

(ii) (in the case of an Ordinary Resolution passed pursuant to Article

67(3)) such other date as may be determined by the Directors),

Unclaimed

dividends

No interest on

dividends

Power to

capitalise profits

IV-18

in proportion to their then holdings of shares and applying such sum on

their behalf in paying up unissued shares in full (or, subject to any

special rights previously conferred on any shares or class of shares for

the time being issued, unissued shares of any other class not being

redeemable shares) for allotment and distribution credited as fully paid

up and amongst them as bonus shares in the proportion aforesaid.

(174) The Directors may do all acts and things necessary or expedient to give

effect to any such bonus issue and/or capitalisation under Article 173, with

full power to the Directors to make such provisions as they think fit for any

fractional entitlements which would arise on the basis aforesaid (including

provisions whereby fractional entitlements are disregarded or the benefit

thereof accrues to the Company rather than to the Members concerned).

The Directors may authorise any person to enter on behalf of all the

Members entitled thereto into an agreement with the Company providing for

any such bonus issue and/or capitalisation and matters incidental thereto

and any agreement made under such authority shall be effective and binding

on all such Members.

(175) In addition and without prejudice to the powers provided for by Article 174

above, the Directors shall have power to issue shares for which no

consideration is payable and/or to capitalise any undivided profits or other

moneys of the Company not required for the payment or provision of any

dividend on any shares entitled to cumulative or non-cumulative preferential

dividends (including profits or other moneys carried and standing to any

reserve or reserves) and to apply such profits or other moneys in paying up

in full new shares, in each case on terms that such shares shall, upon issue,

be held by or for the benefit of participants of any share incentive or option

scheme or plan implemented by the Company and approved by

shareholders in general meeting and on such terms as the Directors shall

think fit.

WINDING-UP/INSOLVENCY

(197) If the Company shall be wound up, subject to due provision being made for

satisfying the claims of any holders of shares having attached thereto any

special rights in regard to the repayment of capital, the surplus assets shall

be applied in repayment of the capital paid up or credited as paid up on the

shares at the commencement of the winding up.

(198) If the Company shall be wound up, the liquidator may, with the sanction of

a Special Resolution, divide among the Members in specie or kind the whole

or any part of the assets of the Company, whether or not the assets shall

consist of property of one kind or shall consist of properties of different

kinds, and may for such purpose set such value as he deems fair upon any

one or more class or classes of property to be divided as aforesaid and may

determine how such division shall be carried out as between the Members

or different classes of Members, but if any division is resolved otherwise

than in accordance with such rights, the Members shall have the same right

of dissent and consequential rights as if such resolution were a Special

Resolution passed pursuant to Section 306 of the Act. A Special Resolution

sanctioning a transfer or sale to another company duly passed pursuant to

the said Section may in like manner authorise the distribution of any shares

or other consideration receivable by the liquidator amongst the Members

Directors to give

effect to bonus

issues and/or

capitalisation

Power to issue

free shares

and/or to

capitalise

reserves for

employee share-

based incentive

plans

Distribution of

surplus assets

Distribution of

assets in specie

IV-19

otherwise than in accordance with their existing rights; and any such

determination shall be binding upon all the Members subject to the right of

dissent and consequential rights conferred by the said Section.

(199) The liquidator may, as he thinks fit, vest the whole or any part of the assets

in trustees upon such trusts for the benefit of Members and the liquidation

of the Company may be closed and the Company dissolved but so that no

Member shall be compelled to accept any shares or other securities in

respect of which there is a liability.

(200) In the event of a winding up of the Company, every Member who is not for

the time being in Singapore shall be bound, within fourteen (14) days after

the passing of an effective resolution to wind up the Company voluntarily, or

within the like period after the making of an order for the winding up of the

Company, to serve notice in writing on the Company appointing some

householder in Singapore upon whom all summonses, notices, processes,

orders and judgments in relation to or under the winding up of the Company

may be served, and in default of such nomination the liquidator of the

Company shall be at liberty on behalf of such Member to appoint some such

person, and service upon any such appointee shall be deemed to be a good

personal service on such Member for all purposes, and where the liquidator

makes any such appointment he shall with all convenient speed, give notice

thereof to such Member by advertisement in any English newspaper widely

circulated in Singapore or by a registered letter sent through the post and

addressed to such Member at his address as appearing in the Register of

Members, and such notice shall be deemed to be served on the day

following that on which the advertisement appears or the letter is posted.

Trust of assets

Service of notice

IV-20

TOPPAN VITE PTE. LTD. SCR1309045

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