(a joint stock company incorporated in the People’s Republic of China with limited liability)
(Stock Code: 3898)
CONNECTED TRANSACTION
ACQUISITION OF ENTIRE EQUITY INTEREST IN
ZHUZHOU TIMES EQUIPMENT TECHNOLOGY CO., LTD.

On 15 November 2007, the Company entered into the Share Transfer Agreement
with Times Industry and the Four Individuals for the purchase of the entire equity
interest in Times Equipment. Pursuant to the Share Transfer Agreement, Times
Industry and the Four Individuals agreed to sell their respective 96.67%, 1.33%,
0.67%, 0.67% and 0.67% equity interests in Times Equipment at the Consideration.
Upon Completion, Times Equipment will become a wholly-owned subsidiary of the
Company.
Times Industry is a wholly-owned subsidiary of the Parent Company, a promoter
and the controlling shareholder of the Company and hence a connected person of
the Company under the Listing Rules. Times Industry is therefore also a connected
person of the Company under the Listing Rules. The Share Transfer constitutes a
connected transaction for the Company under Rule 14A.32 of the Listing Rules and
is subject to the reporting and announcement requirements set out in Rules 14A.45
to 14A.47 of the Listing Rules.
The Directors (including the independent non-executive Directors) considered that
the Share Transfer is in the ordinary and usual course of business of the Company
and the pricing terms of the Share Transfer are on normal commercial terms which
are fair and reasonable insofar as the interests of the shareholders of the Company
as a whole are concerned.
—1—

PRINCIPAL TERMS OF THE SHARE TRANSFER AGREEMENT
Date:
15 November 2007
Parties:
Transferor: Times Industry and the Four Individuals
Transferee: Company
Interest to be transferred:
Pursuant to the Share Transfer Agreement, Times Industry and the Four Individuals
agreed to transfer to the Company the entire equity interest in Times Equipment
which is held as to (i) 96.67% by Times Industry; (ii) 1.33% by XQ; (iii) 0.67% by
LXG; (iv) 0.67% by SWJ; and (v) 0.67% by ZJC. Upon Completion, Times
Equipment will become a wholly-owned subsidiary of the Company.
For the twelve months ended 31 December 2005, the audited net profits both before
and after taxation and extraordinary items of Times Equipment were RMB128,980.12
(equivalent to approximately HK$135,156.79).
For the twelve months ended 31 December 2006, the audited net profits both before
and after taxation and extraordinary items of Times Equipment were
RMB1,555,969.82 (equivalent to approximately HK$1,630,482.89).
Consideration:
The Consideration is RMB3,500,755.75 (equivalent to approximately
HK$3,668,401.71), to be paid in cash in full by means of bank transfer by the
Company to each of Times Industry and the Four Individuals in proportion to their
respective percentage of shareholdings in Times Equipment within 15 working days
from completion of registration of the Share Transfer with the relevant authority for
the administration for industry and commerce. The Consideration will be funded by
internal financial resources of the Company.
— 2 —

In accordance with the auditors’ report issued by (Hunan Tianyue
Certified Public Accountants Firm), as at 30 September 2007, the book value of the
assets of Times Equipment was RMB24,853,676.46 (equivalent to approximately
HK$26,043,881.86). In accordance with the assets valuation report issued by the
Valuer, as at 30 September 2007, the book value of the net assets of Times Equipment
was RMB3,155,600.00 (equivalent to approximately HK$3,306,716.97) and the
assessed value of the net assets of Times Equipment was RMB3,500,800.00
(equivalent to approximately HK$3,668,448.08).
The registered capital of Times Equipment is RMB3,000,000.00 (equivalent to
approximately HK$3,143,665.51). The original purchase cost of 96.67% equity
interest in Times Equipment to Times Industry was RMB2,875,000.00 (equivalent to
approximately HK$3,012,679.45).
The Consideration was determined with reference to the aforesaid assessed value of
the net assets of Times Equipment as assessed by the Valuer as at 30 September 2007.
REASONS FOR AND BENEFITS OF THE SHARE TRANSFER
AGREEMENT

Times Equipment is a wholly-owned subsidiary of the Parent Company and hence a
connected person of the Company under the Listing Rules. Pursuant to the Mutual
Supply Agreement, the Company entered into various supply and sales agreements
with Times Equipment for the supply of certain parts and components for the Group’s
manufacturing lines and for the sales of certain equipment to Times Equipment. After
Listing, such supply and sales agreements constituted connected transactions for the
Company under the Listing Rules. Pursuant to Rule 14A.42(3) of the Listing Rules,
the Company applied for, and the Stock Exchange granted a waiver from strict
compliance with the announcement and the independent shareholders’ approval
requirement under the Listing Rules in respect of the Mutual Supply Agreement.
The Share Transfer will reduce the volume of potential connected transactions
between the Company and the Parent Company and hence streamline the Company’s
operations. The acquisition of Times Equipment will also allow the Company to
vertically integrate such external supplier so as to build up its testing equipment
business and strengthen its research and development capacity in the mechanical
industry.
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The seventh meeting of the independent non-executive Directors of the first term of
the Board was held on 12 October 2007 at which the Share Transfer Agreement was
reviewed and approved. According to the Rules for the Directors’ Meetings of the
Company, a meeting of the executive Directors was held on 5 November 2007 at
which the Share Transfer Agreement was also reviewed and approved. The Directors
(including the independent non-executive Directors) considered that the Share
Transfer is in the ordinary and usual course of business of the Company and the
pricing terms of the Share Transfer are on normal commercial terms which are fair
and reasonable insofar as the interests of the shareholders of the Company as a whole
are concerned.
CONNECTED TRANSACTION

The Parent Company is a promoter and the controlling shareholder of the Company,
holding approximately 54.38% of the registered share capital of the Company. The
Parent Company is therefore a connected person of the Company under the Listing
Rules. Times Industry is a wholly-owned subsidiary of the Parent Company and
therefore is also a connected person of the Company under the Listing Rules. The
Share Transfer constitutes a connected transaction for the Company under Rule
14A.32 of the Listing Rules and is subject to the reporting and announcement
requirements set out in Rules 14A.45 to 14A.47 of the Listing Rules.
As each of the assets ratio, the revenue ratio and the consideration ratio for the Share
Transfer is less than 2.5%, the Share Transfer constitutes a connected transaction
subject to the reporting and announcement requirements set out in Rules 14A.45 to
14A.47 of the Listing Rules but exempt from the independent shareholders’ approval
requirement under the Listing Rules.
TERMS USED IN THIS ANNOUNCEMENT

“Board” the board of Directors
“Consideration” an aggregate sum of RMB3,500,755.75 (equivalent to
approximately HK$3,668,401.71), being the aggregate
consideration payable by the Company to Times
Industry and the Four Individuals for the purchase of
the entire equity interest in Times Equipment
— 4 —

“Company” (Zhuzhou CSR Times Electric
Co., Ltd.), a joint stock company incorporated in the
PRC with limited liability. The Group is the leading
train-borne electrical system provider and integrator for
the PRC railway industry.
“Completion” the completion of the Share Transfer Agreement in
accordance with the terms and conditions thereof
“Director(s)” the director(s) of the Company
“Four Individuals” XQ, LXG, SWJ and ZJC, each of whom is a PRC
individual and is an Independent Third Party
“Group” the Company and its subsidiaries
“Hong Kong” the Hong Kong Special Administrative Region of the
PRC
“Independent Third
Party(ies)”
party(ies) which is or are not a connected person(s) or
party(ies) that is or are not connected with any
Directors, supervisors, chief executive, promoters,
controlling shareholders substantial shareholders of the
Company, its subsidiaries or any of their respective
associates (such terms as defined in the Listing Rules)
“Listing” the listing of the Company’s shares on the Main Board
of the Stock Exchange on 20 December 2006
“Listing Rules” the Rules Governing the Listing of Securities on the
Stock Exchange
“LXG” (Li Xiao Guang), one of the Four Individuals,
holder of 0.67% equity interest in Times Equipment
— 5 —

“Mutual Supply
Agreement”
a mutual supply agreement between the Parent
Company and the Company dated 4 December 2006,
under which the Company agreed to supply and procure
its subsidiaries to supply to the Parent Company certain
electrical parts and components for the production of
the Parent Company’s products and the Parent Company
also agreed to supply and procure its subsidiaries to
supply to the Group certain mechanical and electro-
mechanical parts and components for the production of
the Group’s train-borne electrical systems for a term
commencing on the date of Listing and ending on 31
December 2008
“Parent Company” (CSR Zhuzhou Electric
Locomotive Research Institute), a PRC State-owned
enterprise which is engaged in the research and
development of electric locomotives and related
products; one of the promoters and also the controlling
shareholder of the Company
“PRC” or “China” The People’s Republic of China
“Share Transfer” the transfer of the entire equity interest in Times
Equipment under the Share Transfer Agreement
“Share Transfer
Agreement”
the share transfer agreement dated 15 November 2007
entered into among the Company, Times Industry and
the Four Individuals in respect of the sale and purchase
of the entire equity interest in Times Equipment
“Stock Exchange” 67% equity interest in Times Equipment
“Times Equipment” (Zhuzhou Times Equipment
Technology Co., Ltd.), a limited liability company
established in the PRC which is engaged in the
development, design, manufacture, sale and installation
of shock absorbers, testing equipment, sightseeing
buses and vulcanizing machines, and providing related
technical advice
— 6 —

“Times Industry” (Zhuzhou CSR Times
New Industry Investment Development Co., Ltd.), a
limited liability company established in the PRC which
is engaged in investing in, advising on and providing
security for the development, manufacture, sale and
provision of technical support of electro-mechanical
and IT products
“Valuer” (Hunan Tianyue Certified Public
Accountants Firm), an independent valuer
“XQ” (Xue Qun), one of the Four Individuals, holder of
1.33% equity interest in Times Equipment
“ZJC” (Zhu Jian Cheng), one of the Four Individuals,
holder of 0.67% equity interest in Times Equipment
“HK$” Hong Kong dollars, the lawful currency of Hong Kong
“RMB” Renminbi, the lawful currency of the PRC
For illustrative purposes of this announcement, RMB95.43 = HK$100 save as
otherwise stated.
By order of the Board
Liao Bin
Chairman
China, 15 November 2007
As at the date of this announcement, our chairman of the Board and non-executive director is Liao Bin,
our executive directors are Ding Rongjun and Lu Penghu, our other non-executive directors are Tian
Lei and Ma Yunkun, and our independent non-executive directors are Zhou Heliang, Gao Yucai, Chan
Kam Wing, Clement, Pao Ping Wing and Tan Xiao’ao.
— 7 —