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Notes To The Consolidated Financial Statements
(Expressed in Renminbi)
1
/ China Communications Services Corporation Limited
45 Related parties
(continued)
(a) Transactions with CTC Group
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(6)
On 29 November 2011, Hongbo Information Company Limited (“Hongbo Information”), an
indirectly wholly-owned subsidiary of the Company, entered into the Video Business and
Asset Acquisition Agreement with E-Surfing Video Media Company Limited (“E-Surfing
Video”), an indirect subsidiary of CTC, pursuant to which, Hongbo Information has agreed to
sell, and E-Surfing Video has agreed to acquire, the target video business and asset for a total
consideration of RMB32 million, subject to adjustment. E-Surfing Video is an indirect wholly-
owned subsidiary of CTC which is the controlling shareholder of the Company, so E-Surfing
Video was a connected person of the Company under the Listing Rules. Accordingly, the
disposal constituted a connected transaction of the Company. The Company has complied with
the relevant Listing Rules requirements in respect of such connected transaction and made
corresponding announcement on 29 November 2011.
On 8 December 2011, the Company entered into the Equity Transfer Agreement with Hunan
Telecommunications Industrial (Group) Company Limited (“Hunan Industrial”), a wholly-owned
subsidiary of CTC pursuant to which, the Company has agreed to sell, and Hunan Industrial
has agreed to acquire 100% equity interest in the Hunan New Nantian Real Property Company
Limited, a wholly-owned subsidiary of the Company, for a total consideration of RMB40 million.
Hunan Industrial is an indirect wholly-owned subsidiary of CTC which is the controlling
shareholder of the Company, so Hunan Industrial was a connected person of the Company
under the Listing Rules. Accordingly, the disposal constituted a connected transaction of the
Company. The Company has complied with the relevant Listing Rules requirements in respect
of such connected transaction and made corresponding announcement on 8 December 2011.
(b) Transactions with other government-related entities in the PRC
The Group is a state-controlled enterprise and operates in an economic regime currently dominated
by entities directly or indirectly controlled by the People’s Republic of China through government
authorities, agencies, affiliations and other organisations (collectively referred to as “government-related
entities”).
Apart from transactions with parent company and its affiliates (note 45(a)),the Group has collectively,
but not individually significant transactions with other government-related entities, which include but
are not limited to the following:
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Rendering and receiving services, including but not limited to telecommunications services
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Sales and purchases of goods, properties and other assets
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Lease of assets
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Depositing and borrowing money
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Use of public utilities