Wison Engineering AnnouncesDetails of its Listing on Main Board of HKEx

Wison Engineering Services Co. Ltd.(“Wison Engineering”or the “Company”), the largest private sector chemical engineering, procurement and construction management (“EPC”) service provider in China in terms of revenue for 2011*, today announced details of its proposed listing on the Main Board (“Main Board”) of The Stock Exchange of Hong Kong Limited (“HKEx”).
 

Wison Engineeringwill offer a total of 600,000,000Shares inthe Global Offering, of which 90% will be Placing Shares and 10% will be Hong Kong Public Offer Shares. The Offer Shares will comprise of 480,000,000 new Shares and 120,000,000 Sales Shares. It is expected that the Company will grantto the Placing Underwriters an option exercisable by the Joint Bookrunnersunderthe International Placing Agreementan over-allotment option requiring the Company toissueand allotup to 90,000,000 additional Shares, representing up to15.0 % of the Offer Shares initially available under the Global Offering.
 

The Offer Price will be set ata range of between HK$2.79and HK$3.53per Share. At the mid-point of the indicative offer price range, or HK$3.16 per share, the Company’s net proceeds from the Global Offering are estimated to beapproximately HK$1,360.2 million after deducting underwriting fees and commissions and estimated expenses payable by the Company in relation to the Global Offering.
 

Citigroup Global Markets Asia Limited; Deutsche Bank AG, Hong Kong Branch; BOCOM International Securities Limited are the Joint Global Coordinators;Citigroup Global Markets Asia Limited; Deutsche Bank AG, Hong Kong Branch; BOCOM International (Asia) Limited are the Joint Sponsors; Citigroup Global Markets Asia Limited; Deutsche Bank AG, Hong Kong Branch;BOCOM International Securities Limited;UBS AG, Hong Kong Branch; CITIC Securities Corporate Finance (HK) Limited arethe Joint Bookrunners and the Joint Lead Managers of the proposed listing.
 

The Hong Kong Public Offering will openat 9:00am on Thursday, 13 December 2012 and close at 12:00 noon onTuesday,18December 2012. Tradingof the Company’s Shares is expected to commence on Friday, 28 December2012 under the stock code 2236. Shareswill be traded in board lots of 1,000 Shares each.
 

Proposed Use of Net Proceeds

The Company intends to use approximately 58.6% of the total estimated net proceeds from the Global Offering for the construction and establishment of a national research and development center in Shanghai and an engineering, research and development center in Beijing. In addition, approximately 25.4% of the total estimated net proceeds will be used for the research and development of proprietary technologies, including syngas-to-ethanol processes; approximately 9.8% will be used for expanding engineering capability in selected cities in China;and the remaining 6.2%will be used forworking capital and general corporate purposes.
 

Largest Private Sector Chemical EPC service provider in China with Proven Track Record

WisonEngineering was the largest private sector chemical EPC service provider in China in terms of revenue in 2011*, as estimated by CMAI (Shanghai) Limited (“CMAI”), an independent industry consultant. The Company provides a broad range of integrated services to the petrochemicals, oil refining and coal-to-chemicals conversion processing industries, spanning the project lifecycle from feasibility studies, consulting services, the provision of proprietary technologies, design, engineering, raw materials and equipment procurement and construction management to maintenance and after-sale technical support.
 

In the petrochemicals business segment, the Company has a leading position as an ethylene EPC service provider in China in terms of the number of furnaces installed, based on EPC contracts between January 1 2000 and June 30 2012, according to CMAI, and has undertaken the design, renovation and construction of 115 ethylene cracking furnaces since 2000. Wison Engineering is also one of the six companies in the world to have developed proprietary commercial ethylene cracking furnace technologies.
 

The Company has also been active in increasing its presence in the oil refinery and coal-to-chemicals business segments over the years. It completed construction of an oil refinery for PetroChina Dalian in 2008, the largest production facility of its kind in China at the time it was commissioned. As the owner of a significant number of proprietary technologies in the areas of coal-to-olefins, energy saving and the provision of one-stop services encompassing transfer of the proprietary technologies, design and construction of the plants, the Company also completed the Wison (Nanjing) Synthesis Gas Projection 2009.
 

Well Recognized Project Execution Capability

Over the years, the Company has accumulated a significant amount of experience and execution capabilities in the provision of EPC services in China. It has a record of achieving high quality in its projects, including successful production in all the oil refineries and petrochemical and coal-to-chemicals production facilities the Company has built or renovated since 2000 at initial start-up. The Company has also completed almost all of its major construction projects from 2009 to first half of 2012 in a timely fashion, on or ahead of schedule, allowing its clients to start their production soonerthan expected. Moreover, the Company has a health, safety and environment (HSE) divisionthat monitors itsworksites carefully. The Company’shighsafety record has been achievedthrough prevention-based programs, risk evaluation, job-specific safety training,incident investigation and on-site safety supervision. It has also established a long track record through a well-established business operation platform.
 

Strong Technological Innovation Capabilities

Wison Engineeringalso puts heavy emphasis on technological innovationin order to strengthen its leading position in the industry. Recognized by the Chinese government as a “High and New Technology Enterprise”, the Company has a well-established in-house R&D team. As of 30 June 2012, the team had 45 full-time staff members with an average of tenyears of related experience. Italso employs a number of part-timespecialists, including five former professors of Tsinghua University andEast China University of Science and Technology, to focus on research and development in the area of coal-to-chemicals separation.The Company’s seasonedengineering division has 615 personnel with average working experience of approximately ten years.As of 3December 2012, the Company has been awarded 31patents in China and also has 26patent applications pending in China.
 

Long-term and Close Relationships with Suppliers, Sub-contractors and Customers

Wison Engineering has developed a strong database of 1,292 qualified domestic and 85 qualified overseas suppliers, as well as another 608 potential overseas suppliers and 148 qualified sub-contractors as of June 30 2012. The Company seeks to maintain long-term business relationships with selected suppliers, allowing it to meet its clients’ various technical and quality standards and to promote overall cost savings for them.
 

With the Company’s ability to provide turnkey and customized services, combined with its strong technological innovation and project execution capabilities, as well as extensive supplier network, the Company has developed close, long-term relationships with its clients, including the PRC state-owned oil companies and international operators such as BASF and Shell.
 

Solid Business Growth

WisonEngineering has enjoyed solid growth in the past three years. The Group’s revenue represents a compound annual growth rate (CAGR) of 63.5%. The Group’s profit and total comprehensive income attributable to equity holders of the parent also a CAGR of approximately 58.5%.
 

Wison Engineering had successfully introduced Chow Tai Fook Nominee Limited (“Chow Tai Fook”), Solar City Holdings Limited (“Solar City”) and EA Asia Absolute Return Master Fund (“EA Asia”) as cornerstone investors of the Company. Solar City,  EA Asia and Chow Tai Fookwill hold approximately 1.23%, 0.61%, and 1.23%, respectively, of the Company’s outstanding Shares immediately following the completion of the Global Offering (assuming that the Over-allotment Option is not exercised) assuming an Offer Price of HK$3.16 per Share (being the mid-point of the Offer Price range).
 

Mr. HuaBangsong, Chairman and Executive Directorof Wison Engineering says, “We are pleased to witness this milestone in the Company’s history. Through our listing on the Hong Kong Stock Exchange, we will tap into the international capital markets, which will not only boost our capital base, but also strengthen our leading position in the industry and enhance our competitive advantages, thereby driving the Company’s further development.”
 

Supported by global oil demand and economic growth, the global demand for oil refineries and petrochemicals products has been fuelling the expansion in global capacity, particularly in Asia. As one of the largest petrochemical markets in the world in terms of production capacity and consumption, China has been building new oil refineries and increasing petrochemical production capacity, as well as supply, to meet the growing demand propelled by the country’s growth. The Chinese government has also encouraged more coal-based chemical production in China to reduce dependence on petroleum and to utilize coal resources in a more environmentally friendly manner. Addressing the needs of the growing market, project owners of petrochemical and oil refinery facilities are increasingly outsourcing engineering, procurement and construction management projects to EPC service providers such as Wison Engineering,providing enormous market opportunities for the EPC industry.
 

Mr. Hua added, “Looking forward, we are poised to take advantage ofthe favorable operating environmentwith our strengths in project execution and technological innovation, along with our proven track record and established supplier and sub-contractor network. We will further strengthen our design and engineering capabilities, consolidate and fortify our leadership position as a provider of EPC services in China’s petrochemical industry, continue to recruit talents, and capitalize onthe experience we have gained from our milestone projects in China to actively develop our presence in the international markets, including Southeast Asia, the Middle East, West Africa and Latin America. With our competitive edges and business plans in place, we are well-positioned to benefit from the enormous market opportunities.”

* As estimated by an independent industry consultant, CMAI (Shanghai) Limited.