What
is Ally Giant (the Concert Group)?
Per the Group’s prospectus issued on 25
February 2008 “Company History and Reorganization - Ownership Continuity and Control” Section, some of the Group’s
shareholders, including Zhang Mi, Ren Jie, Liu Zhi, Zheng Yong, Zuo Huixian,
Zhang Xu, Wang Jiangyang, Chen Jun, Fan Bin, Zhang Yanyong, Ao Pei, Tian
Diyong, Shen Dingjian, Liu Xuetian (deceased), Zhou Bin, Lu Lan, Tian Yu, Li
Hanqiang, Liu Yingguo, Liu Lulu, He Guangfu, Zhang Zongyou and Chen Zongliang,
formed the Concert Group (Out of which He Guangfu, Zhang Zongyou and Chen
Zongliang transferred an aggregate of approximately 9.1325% equity interest in
Honghua Company to the other members of the Concert Group. The transfers were
completed on 17 February 2006).
How should I understand
disclosure of changes in board-members’ interest posted by the Stock Exchange
of Hong Kong?
According to Hong Kong Securities and Futures Ordinance, all equity changes
made by board-members need to be disclosed. If changes to the Concert Group’s
shareholding does not exceed one percent, no disclosure is required. Any
trading by the Concert Group members will cause the interest of Group’s three
board-members (Mr. Zhang Mi, Mr. Ren Jie and Mr. Liu Zhi), also as members of
the Concert Group, to change, and thus needs to be disclosed.
Types of trading disclosures by the Stock Exchange of Hong Kong (the
“Exchange”):
The
Group’s three board-members (Mr. Zhang Mi, Mr. Ren Jie and Mr. Liu Zhi) hold Honghua Company equity
interest through the Company, trust and Ally Giant (the Concert Group). The
corresponding trading disclosed by the Exchange are categorized into:
(1) Beneficial
owner(Code201);
(2) Discretionary
trust founder(Code 209);
(3) Members
of the Concert Group(Code 211)。
Between 8 October 2012 and 22 October 2012, per the
Exchange’s disclosure of interest website, these three board members (Mr. Zhang
Mi, Mr. Ren Jie and Mr. Liu Zhi) sold 100,000 shares of Honghua Company. Disclosure
of interest code is 211, indicating this shareholding change is made not by the
three board-members above, but by other members of the Concert Group. Because
this equity change does not exceed one percent, the Exchange’s website
disclosed only Mr. Zhang Mi, Mr. Ren Jie and Mr. Liu Zhi’s shareholding
changes.
Honghua has a diverse global
marketing network, and has established 10 wholly owned subsidiaries in China,
USA, Russia, Egypt, United Arab Emirates and Ukraine, and 4 representative
offices in India, Indonesia, Pakistan and Uzbekistan. In the full year 2011,
Honghua generated revenue of RMB 3.15 billion from exports, accounting for
approximately 90.4% of the Group's total revenue.
As
international business grows, Honghua will open more representative offices,
warehouses and service centers to realize sales and services covering its
global network.
Honghua Group’s strategic
partners include Nabors Industries Limited, one of the world largest oil &
gas drilling equipment contractors, China Ocean Oilfields Services, a wholly
owned subsidiary of China National Offshore Oil Corporation, and some
institutional investors including Carlyle Group, Development Partners Fund, and
etc.
Honghua has advanced technological and engineering expertise and
a track record of developing successful new technologies. As one of the leading
developers of land rig technologies in China and the first rig manufacturer to
launch the digitally-controlled VFD rigs in China, Honghua has created a wide
range of patented technologies and proprietary designs which enhance the
function and performance of drilling rigs. As of June 30th, 2012, the Group has
accumulatively filed 165 patent applications and 86 of them had been approved.
In
2012, the in-house designed products including direct top drives and
direct-driven pumps have been successfully launched and are constantly modified
to meet the demands of customers in different regions. In regard to products
for non-conventional gas drilling equipment, Honghua has designed the super
single pipe rigs, coiled tubing rigs, rack and pinion rigs and
fracturing pumps. Regarding the offshore oil and gas equipment segment,. both
of the jack-up platform jacking and fixation systems have passed the load test
and the following NDT certification of American Bureau of Shipping (the“ABS”) ,
and also obtain certification by ABS officials and quality inspectors.
Leveraging on its solid
foundation on land drilling equipment manufacturing, Honghua will proactively
implement its diversified development strategy in both the land and offshore
segments, so as to develop into a diversified conglomerate with interactive development
in the fields of equipment production, oil and gas resources exploration
(especially the unconventional oil and gas sector) as well as engineering
services.
Honghua Group
Limited is a large-scale equipment manufacturer and drilling service provider,
specializing in research, design, manufacture, and set-assembly of drilling
rigs, offshore engineering, and oil & gas exploitation and production equipment.
It is the biggest exporter of drilling rigs in China, and one of the largest
land drilling rig manufacturers in the world. Leveraging on its strong research
and development capabilities, quality production facilities, as well as a
highly-sophisticated global marketing network, the Group’s products are sold to
world-renowned customers in major oil-producing regions such as North America
and the Middle East, and emerging markets such as South America, India, Russia,
China and Africa.
Launched its IPO in
March 2008, Honghua (HKEx 0196) became the first drilling rig manufacturer of
China to go public. Headquartered in Chengdu, Sichuan, Honghua Group has
positioned its land and offshore equipment manufacturing bases in Guanghan,
Sichuan and Qidong, Jiangsu respectively; the group also operates through more
than ten overseas subsidiaries and agencies with manufacturing facilities in
America, Dubai and Egypt etc.