Hylands Assists Yuexiu Group to Accept the ‘Asset Package’ of CNY 15 Billion from Guangdong Rising Assets Management

On December 28, 2018, Guangdong Rising Assets Management and Yuexiu Group held a signing ceremony for the transfer of the Guangsheng Expressway Asset Package (Asset Package) under the witness of the director of SASAC of Guangdong Province and Guangzhou City, with the asset package valued at over CNY 15 billion. Guang XU, chairman of Guangdong Rising Assets Management, said that this will become a new model for the reform of state-owned enterprises in Guangdong Province and play an exemplary and leading role. Zhaoxing ZHANG, chairman of Yuexiu Group, said that the transfer of the asset package is of great significance to Yuexiu Group’s development of its main business of transportation. The expressway mileage held by Guangsheng Expressway Asset Package in this transaction was about 200 kilometers.

The asset package of Guangsheng Expressway transferred under this agreement involved three expressways. After years of operation, the toll growth is steady, with a relatively long remaining toll period. Furthermore, it has significant geographical advantages. Judging from the economic conditions of the area where the expressway is located, the expressway project of Guangsheng Expressway Asset Package is located in the eastern Hubei Province, which is an economic and population gathering place in Hubei Province and will benefit from the increase in freight traffic volume and passenger flow volume brought by the steady growth of regional population and economy. Among the three expressways, two of them are the exit routes of Wuhan City which will be an advantage due to the increased traffic from and to the city. The other one is one of the vertical components of the national expressway network plan, ‘71118’, approved by the State Council. The Guangsheng Expressway Asset Package is expected to usher in a period of rapid growth around 2022, and the toll income is expected to continue to grow in the future.

In this project, Hylands Law Firm’s Guangzhou Office (formerly the team of Kunlun Law Firm) served as the legal adviser of Yuexiu Group. They assisted Yuexiu Group in negotiating with its counterparts, demonstrated the acquisition plan, led the drafting and revision of a complete set of transaction documents, fully participated in the negotiation of the terms of all transaction documents, and were responsible for due diligence on the ‘asset package’ of CNY 15 billion of Guangdong Rising Assets Management. The project, which lasted 15 months, involved the transfer of state-owned assets between provincial and municipal enterprises. Hylands ultimately contributed to the strategic cooperation between Guangdong Rising Assets Management and Yuexiu Group through the coordination of personnel and resources.

The managing partner of the project was Yuxiang XU, and the main members included Wenjun YUE, Zhe YAN, Meiling ZHONG, Xuewu ZHONG, et al.