Annual Report 2023

ANNUAL REPORT 2023 67 the BOT Agreement, the parties agree to adopt the “Build-Operate-Transfer (BOT)” model for the implementation of the SACLH Project. CICT, a subsidiary of the Company, is owned as to 85% and 15% by the Company and SLPA, respectively. Accordingly, SLPA is considered a connected person of the Company at the subsidiary level under the Listing Rules. The transactions contemplated under the Shareholders Agreement and the BOT Agreement in relation to the SACLH Project therefore respectively constituted connected transactions of the Company under Chapter 14A of the Listing Rules. (iii) Reference is made to the announcement of the Company dated 25 May 2023. On 25 May 2023, Cyber Chic Company Limited (“ Cyber Chic ”) (a wholly-owned subsidiary of the Company) as the transferor entered into an assets and equity transfer agreement (the “ Assets and Equity Transfer Agreement ”) with Ningbo Zhoushan Port Company Limited (“ Ningbo Port ”) as the transferee, pursuant to which Ningbo Port agreed to purchase and Cyber Chic agreed to dispose 45% equity interest in Ningbo Daxie China Merchants International Terminals Co., Ltd. ( 寧波 大榭招商國際碼頭有限公司 ) (“ Ningbo Daxie ”) at a consideration of RMB1,845.00 million. Upon completion of the disposal of 45% equity interest in Ningbo Daxie by Cyber Chic to Ningbo Port pursuant to the Assets and Equity Transfer Agreement (the “ Disposal ”), the Company will no longer hold any interest in Ningbo Daxie, thus Ningbo Daxie will no longer be accounted as a subsidiary in the consolidated financial statements of the Group. As Ningbo Port is one of the substantial shareholders of Ningbo Daxie, Ningbo Port is a connected person of the Company at the subsidiary level, and thus the Disposal constituted a connected transaction of the Company under Chapter 14A of the Listing Rules. (iv) Reference is made to the announcement of the Company dated 15 September 2023. On 15 September 2023, Khor Ambado FZCO (“ Djibouti Asset Company ”) as lessor entered into a lease agreement (the “ Land Lease Agreement ”) with China Merchants Holdings (Djibouti) FZE (“ CM Djibouti ”) (a wholly-owned subsidiary of the Company) as lessee, pursuant to which the Djibouti Asset Company as lessor would sub- lease a parcel of land with an area of 86,247.66 square metres within the Djibouti International Free Trade Zone (the “ DIFTZ ”) (the “ Leased Land ”) to CM Djibouti as lessee, for a term commencing on the date of the Land Lease Agreement and ending on 14 August 2116. CM Djibouti shall pay to the Djibouti Asset Company: (i) rent in an aggregate amount of approximately US$8.62 million (equivalent to approximately HK$67.24 million) for the full term of the lease as contemplated under the Land Lease Agreement; (ii) a land grant fee in an aggregate amount of approximately US$4.97 million (equivalent to approximately HK$38.77 million); and (iii) property management fees at respective annual rates of US$nil for the first six years from the completion date (date of completion of the construction period of CM Djibouti’s phase-2 warehouse project on the Leased Land, which period shall end upon CM Djibouti’s written approval of work completion certificates of such project on the Leased Land), no more than US$0.50 (equivalent to approximately HK$3.90) for the following five years, and thereafter, no more than US$1.00 (equivalent to approximately HK$7.80) for the remaining term of the Land Lease Agreement, in each case, per square metre of the surface area of the Leased Land. Pursuant to HKFRS 16, the Leased Land will be recognised by the Group as a right-of-use asset, in which the value is approximately US$13.60 million (equivalent to approximately HK$106.08 million), amortised over the lease term on a straight-line basis. The Djibouti Asset Company is an associate of CMG (the ultimate holding company of the