China M&A Index

China M&A Index was initiated together by Global M&A Research Center, www.mergers-china.com and the periodical "Money China".

Top 5 M&A Deals (From January 15, 2003 to February 15, 2003)

1. Huaneng Power International Acquiring Shenzhen Energy Group
On January 29, 2003, Huaneng Power International, Inc. acquired 25% equity shares of Shenzhen Energy Group Co., Ltd for ￥2.39 billion in cash, which forms a strategic a partnership between two corporations. The acquisition took place after Shenzhen Energy finished increasing 10% of its registered capital.
2. BOE (000725, 200725) Acquired HYDIS TFT-LCD Business
BOE formally announced on February 12, 2003 that BOE had closed the acquisition on HYDIS TFT-LCD business for $3800 million and assets transfer had been accomplished on January 22, 2003.
3. MBO Plan Get Approved
On February 14, 2003, MBO plan of Quanxing Group was approved by State-owned Assets Management authorities and formally launched the same day. ￥2700 million financing arrangement by Hengping Trust has played a key role and become the money source for the buy-outs.
4. SEG Samsung Selling Stake to a Foreign Company
January 28, 2003, SEG Group sold 1107.49679 million non-tradable stake totaled 14.09% of all its interest to Samsung Corning Investment Co., Ltd for ￥2.1415/share worth of total value of ￥2371.70438.
5. BYD Company Limited Acquiring Qinchuan Automobile Co., Ltd
On January 22, 2003, Mr. Wangchuanfu, known as his cell business in Asia-Pacific region, announced in Hong Kong that his HKEX listed holding company, BYD Company Limited, would acquire an aggregate of 77% equity interest in Xi'an Qinchuan Automobile Limited Liability Company for RMB 269,500,000(about HK$ 254 million). After acquisition, BYD becomes the first non-governmental company to hold a majority stake in a state-owned automobile enterprise.

Comments on Top 5

Though occurring at the beginning of year 2003, Top 5 events have fully reflected the trend in M&A market for the whole year. In the event of Huaneng Power International, Inc. acquiring stakes of Shenzhen Energy Group, public bidding was invited, which indicated M&A transaction conducted in China would become more and more transparent and market-oriented. BOE's overseas acquisition continues the momentum of Chinese enterprises' going-out in 2002. The MBO plan of Quanxing Group was approved and launched with the help of Trust money, which shows the trust industry has come into virtual operation in assisting MBO plans in China. The steps of foreign capital into Chinese capital market and exit of state-owned stake from listed company has been quickened as SEG Samsung had part of his non-tradable stakes sold to Samsung Corning, a foreign company. BYD's acquisition shows again the vigorous development of Chinese non-governmental enterprises. Top 5 M&A events with different characteristics comprehensively reflect the following trends in China M&A market in 2003: market-orient acquisition mode, booming transnational M&A transactions, MBO becoming the hot point with the help of trust money and rapid expansion of non-governmental economic sector.

M&A Deal Volume

Comments:
From November, 2002 to January, 2003, M&A transactions concerning listed companies show a distinct year-end trend. In the last two months of year 2002, November and December respectively, financial restructurings aiming to report a good achievement in the year-ago period pushes the M&A activities to a peak. However, during January, 2003, either the M&A deal volume or number of transactions has been largely declined. Nevertheless, the number of M&A transactions happening in January, 2003 is still larger than that in the same period last year due to the better macro economic policy and the booming capital market. M&A transactions conducted by listed companies are becoming more and more active.

M&A Industry Distribution

1. Distribution Graph in Terms of Sum of Money

2. Distribution Graph in Terms of Number of Transactions

Notes:
1. Pie graph shows the industry percentage in terms of money involved in M&A transactions; Column graph indicates the number of M&A deals conducted in each industry.
2. Industries are classified in compliance with what China Securities Regulatory Commission has defined for listed companies: A for Agriculture, Forestry, Hunting and Fishing; C1 for Textile, Apparel and Leather; C3 for Paper Manufacturing and Printing; C4 for Petroleum, Chemical Manufacturing, Plastics and Rubber Product Manufacturing; C5 for Computer and Electronic Product Manufacturing; C6 for Metal and Nonmetallic Product Manufacturing; C7 for Machinery Manufacturing, Component Manufacturing and Instrument Manufacturing; D for Utilities; F for Transportation and Warehousing; G for Information; H for Wholesale Trade and Retail Trade; J for Real Estate; K for Services; M for Diversified Industry.

M&A Targets
M&A Targets investigates the possibility a listed company may be acquired by others during its operation. The figure shown below range from 0 to 100. The larger it is, the higher possibility a company will be acquired. Please note this figure can not be necessarily taken as a reference to invest in the capital market.

Ranking	Symbol	Code	Score	Industry	Ownership Change
1	ST同达	600647	92.325	M	N/A
2	ST九州	653	91.89622	Other Manufacturing	Changed
3	丰乐种业	713	89.88592	K	Changed
4	中农资源	600313	89.6265	A	N/A
5	ST国嘉	600646	89.6049	C5	N/A
6	ST鞍一工	600813	88.45121	C7	N/A
7	大江股份	600695	87.81464	Food and Beverage	Largest shareholder changed
8	ST春都	885	86.26828	Food and Beverage	Largest shareholder changed
9	菲菲农业	769	85.61527	K	N/A
10	ST辽国际	638	85.20223	M	Ownership changed
11	ST厦华	600870	85.09732	C5	Ownership changed
12	ST宏业	689	84.85392	C6	Ownership changed
13	爱使股份	600652	84.85206	M	Largest shareholder changed
14	济南百货	600807	83.32748	H	N/A
15	ST海洋	658	83.11706	M	Largest shareholder changed
16	ST吉化	618	82.37356	C4	N/A
17	赣南果业	829	82.30066	A	Ownership changed
18	武汉塑料	665	82.22587	C4	Largest shareholder changed
19	复旦复华	600624	81.57582	M	N/A
20	深深房A	29	81.55781	J	Ownership changed