soho china ltd (45S) Snapshot

Soho China Ltd. approved to appoint PricewaterhouseCoopers as auditors of the company and authorise the board of directors to fix their remuneration at the AGM held on 14 May 2013.

Soho China Ltd. on April 24, 2013, lost a lawsuit over a premium piece of land in central Shanghai's Bund area. The Shanghai No. 1 Intermediate People's Court nullified an earlier share transfer agreement between Soho China, Shanghai Zendai Property Ltd. and Greentown China Holdings Ltd, which had enabled Soho to acquire a 50% share in one of Shanghai's land projects. Units of the Fosun Group, who filed the lawsuit, holds the remaining 50% of the land project, which the Shanghai municipal government had sold to Fosun during an auction in February 2010 for CNY 9.22 billion ($1.48 billion). Soho had acquired a 50% share in the land project from units of Fosun's former partners Shanghai Zendai and Greentown China for CNY 4 billion. The Shanghai court decided that the agreement had deprived Fosun of its first right to refuse to purchase the remaining 50% share of the joint venture for the land project.

On April 24, 2013, the Shanghai No. 1 Intermediate People's Court of the PRC issued its judgment (trial judgment) in relation to the court action. The trial judgment (to the extent relating to Soho China Ltd.) is summarized as follows: 1. orders for the invalidation of (a) the agreement to transfer 100% equity interests in Zendai Wudaokou and Greentown Hesheng respectively from Shanghai Zendai Land and Zhejiang Jiahe to Shanghai Chang Ye as stipulated under the equity transfer and loan assignment agreement; (b) the Zendai Wudaokou Transfer; and (c) the Greentown Hesheng Transfer, were granted; and 2. an order to restate the ownership of Zendai Wudaokou and Greentown Hesheng to the state prior to the Zendai Wudaokou transfer and Greentown Hesheng transfer was granted. The relevant subsidiary of the company and the vendors (i.e., the respective subsidiaries of Shanghai Zendai Property and Greentown Holdings) (as informed by Shanghai Zendai Property and Greentown Holdings, respectively) have reviewed the trial judgment and will make an appeal to the Higher People's Court of Shanghai. As advised by the company's PRC legal advisers, if the appeal is made, the relevant subsidiary of the company is required to submit the appeal documents to the Shanghai Intermediate People's Court within 15 days from the service of the trial judgment. As further advised by the company's PRC legal advisers, since the trial judgment cannot be enforced and will not become effective pending the results of the appeal, the company's relevant subsidiary is still holding 100% equity interests in Zendai Wudaokou and Greentown Hesheng, which, upon completion of the project company transfer agreement, will, through Haizhimen, be indirectly holding 50% interest in the Bund 8-1 Land. Therefore, the company considers that the trial judgment does not have any material adverse effect on the operations or financial position of the group.