CCCC acquires all equity in Aecon

On October 26, CCCI, a subsidiary of CCCC, signed an agreement with Canada's listed company Aecon Group Inc. (Aecon) in Toronto. Under the agreement, CCCC will acquire 100 percent equity in Aecon for C$ 1,450 million (approximately RMB 7,509 million), and complete equity delivery in the first quarter of 2018 upon approval by the relevant governmental regulatory body.

Headquartered in Toronto, Aecon was founded in 1877 and listed on the Toronto Stock Exchange in 1987. It is ranked among Canada's top three construction enterprises and enjoys high prestige in the industry. It has four primary business sectors: infrastructure, energy engineering, mining infrastructure (contractual mining) and franchise. Its infrastructure sector includes rail transit, road, bridge and tunnel, airport construction, hydraulic power generation and sewage treatment; its energy engineering sector includes conventional energy such as water & electricity, thermal energy, electric energy, petroleum and natural gas, as well as the construction of facilities of new energy such as solar energy, wind energy, bioenergy and garbage power generation, it has outstanding capacity for nuclear power construction; its mining infrastructure (contractual mining) sector covers the full process of mining engineering; and its franchise sector involves PPP, BOT, BT, BOO, BOOT and other project models in fields including rail transit, toll road, bridge and airport construction.

Aecon's business is diversified. Its model of business sector integration is mature. With the capacity for lifecycle project operation, it enjoys unique competitive edge and has earned wide recognition from customers. Particularly, its experience in the franchise sector has further consolidated its market position.

Aecon registered business revenues of C$ 3,213 million (approximately RMB 16,639 million), an after-tax profit of C$ 47 million (approximately RMB 243 million) and total assets of C$ 2,005 million (approximately RMB 10,383 million). As of June 30, 2017, it registered an uncompleted contract amount of some C$ 4,351 million (approximately RMB 22,523 million).

Acquiring Aecon is a major move of CCCC in its international strategy. Through the acquisition, CCCC will achieve a substantial breakthrough in its full entry into North America, and acquire a major platform for its business development in North America, thus furthering its operations in developed countries. Canada has favorable political, economic and social environment, and the government plans to significantly increase its infrastructural investment in the coming five years. CCCC will occupy a place in Canada by virtue of Aecon's leading status in the industry. Following the acquisition, CCCC is expected to collaborate with Aecon in the infrastructural sector, Aecon's strength in the fields of energy engineering and mining engineering will boost CCCC's business development. Besides, CCCC will promote business collaboration with Aecon and John Holland after the acquisition to enhance its competitiveness in high-end mature markets.

Following the acquisition, as CCCC's subsidiary, Aecon will retain its original brand and continue its operations in Canada; and CCCC will duly support Aecon in strategies, capital, business network and technologies, accomplish good business complementation, interaction and integration with Aecon, and help it win more major complex projects and gradually extend to the international market. As another case of cross-border M&A after CCCC successfully acquired America's F&G, Australia's John Holland and Brazil's Concremat, the acquisition will lay the groundwork for CCCC to become a world top enterprise with international competitiveness.