Stock Name:* ST Wazhou B Stock Code: 200706 No.: 2016-37 Wafangdian Bearing Company Announcement Limited Related Transaction The Company and whole members of the Board hereby ensure that the Notice is factual, accurate and complete without any false record, misleading statements or important omissions.
I. Trading overview
i. Summary of the transactions approved in early board session
(1) On August 25, 2016 and September 23, 2016 WBC respectively hold the seventh session of the board meeting for the first time and the first interim board of directors meeting,Examined and approved a series of related transactions to buy and sell assets bill (see the laptop company on August 27, 2016, on September 24, published in the "Hong Kong commercial daily", "securities times and the tide of information network on the disclosure of the statement on leased assets of related transactions, the connection transaction announcement about buying equipment and the related transaction announcement about the sale of assets).
(2) After the board meeting, the company hand these proposal to Dalian municipal SASAC fro approval, and accept its designated with execution of securities and futures related business qualification appraisal institution for part of the bill were evaluated, and issue the evaluation report. ii. Details information
1. The proposal of adjusting the business of WBGC automobile bearing branch, precision cage company, precision roller company, renting out related assets and involving related transaction (Adjusted);
Due to the need of company business, trading through with each other friendly consultation, to adjust scope of asset, no change other content. See the table below:
(1) leased equipment
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|No.||Lessor|Lessee||2016.9.1-12.31||||||||
||||||PCS||Original Value||Net Value||Rental Fee||
|1||||Cage company|119||2214.98||705.5||82.91||
|2||WBC||Roller company|216||12719.02||8185.66||375.64||
||3|||Auto branch||325||8840.61||5903.43||341.75|
||||Total||660||23774.61||14794.59||800.3||

(2)land and housing rental
Stock Name:* ST Wazhou B Stock Code: 200706 No.: 2016-37
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|No.|Lessor|Lessee|M2|Rental unitprice(RMB/year)|Area (m2 )|Rental unitprice(RMB/year)|Workshopin rent (tenthousandyuan|)|In land rent(tenthousandy u an )|The total annualrent (tenthousand yuan）|
|1|WBC|AutomotiveBearingBranchCompany|30,020|120|||360.24|0|360.24|
|2|WBC|Cagecompany|12,733.72|60|17,543.22|15|76.4|26.31|102.72|
|3|WBC|Rollingcompany|10,754.31|60|13,712.49|15|64.53|20.57|85.1|
|合计|||53,508.03||31,255.71||501.17|46.88|548.06|

 2.about buying rental equipment and associated business proposal(after audited ):
The main evaluation content is as follows:
(1)the evaluation base date: August 31, 2016
(2)evaluation method: cost method
(3)assessment result summary table
||||||
|-|-|-|-|-|
|Project|Qty（pcs）|Original Value（tenthousand yuan）|Net Value （tenthousand yuan）|Assessment value(ten thousand yuan)|
|The company purchasesequipments from EquipmentEngineering Company|235|5,660.02|3,823.55|4,885.47|

3. About the sale of assets and related transactions(after audited )
3.1 The proposal of selling the Shenyang agencies plant to WBGC;
The company in 2016 third extraordinary meeting of board of directors (held in September 23, 2016) approved in 2015 to assess the value of fall10% price to sell Shenyang ZWZ housing distribution department. Therefore, part of the assets assessment report has passed the validity to ensure service continuity, and asset trading fair and justice, the company decided to re evaluate this part of the assets, and to assess the value of sale.
The company in accordance with the relevant procedures, and accept what is dalian municipal state-owned assets supervision and administration in the database to extract with enforcement of securities and futures related business qualification assessment institution to evaluate this part of the assets of the company, and issue the evaluation report.
The main evaluation content is as follows:
Stock Name:* ST Wazhou B Stock Code: 200706 No.: 2016-37 (1) the evaluation base date: August 31, 2016
(2) evaluation method: marketing
(3) assessment result summary table
Units: ten thousand yuan
|||||||
|-|-|-|-|-|-|
|Assets Name|Original Value（Yuan）|Net Value（Yuan）|2014 assessment value|2015 assessment value|2016Assessmentvalue|
|Shenyangagencies salescompany|457.36|126.94|1,956.21|1,535.53|1,777.92|

3.2 The proposal of selling the Pulandian plant to WBGC;
The main evaluation content is as follows:
(1) the evaluation base date: August 31, 2016
(2) evaluation method: cost method
(3) assessment result summary table
Units: ten thousand Yuan
||||||
|-|-|-|-|-|
|Assets Name|Area (m2 )|Original Value|Net Value|Assessment value (tenthousand Yuan)|
|PuLanDian houses|18,020.93|1,579.02|298.15|1072.53|

3.3 The proposal of selling the fully depreciated equipment to WBGC automobile bearing
branch, precision cage company, precision roller company.
The main evaluation content is as follows:
(1) the evaluation base date: August 31, 2016
(2) assessment methods: cost method (part of the electronic device adopts the marketing)
(3) assessment result summary table
Units: ten thousand Yuan
|||||||
|-|-|-|-|-|-|
|NO.|Buy the unit|Qty（pcs）|Original Value|Net Value|Assessment value|
|1|Automotive BearingBranch Company|255|3,134.48|87.40|393.57|
|2|Cage company|224|2,546.48|68.74|430.04|
|3|Rolling company|704|5,767.54|155.61|1,050.38|
|Total||1,183|11,448.50|311.75|1,873.99|

Stock Name:* ST Wazhou B Stock Code: 200706 No.: 2016-37 3.4 The proposal of selling idle equipment to WBGC equipment manufacturing Company;
The main evaluation content is as follows:
(1) the evaluation base date: August 31, 2016
(2) evaluation method: cost method
(3) assessment result summary table
Units: ten thousand Yuan
|||||||||
|-|-|-|-|-|-|-|-|
|NO.|Project|Qty（pcs）||Original Value（Yuan）|Net Value（Yuan）|Provision fordiminution in value|Assessment value|
|1|Idle equipment||108|4092.73|409.81|22.02|667.19|

 3.5 The proposal of selling railway private sidings and related assets to WBGC precision
forging Company;
The main evaluation content is as follows:
(1) the evaluation base date: August 31, 2016
(2) evaluation method: cost method
(3) assessment result summary table
Units: ten thousand Yuan
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||NO.||Device name||Original Value||Net Value||Assessment value|
|1||Railway private sidings||218.35||-||402.65||
|2||rail car||13.00||0.39||1.92||
|3||diesel locomotive||85.65||-||12.31||
|Total||||317.00||0.39||416.88||

II.Introduction to the new proposal
1. Overview of transactions
Because WBC has transfer the atuo bearing, rolling and cage related business transferred to
WBGC and the newly established company, according to the needs of production and operation, low value of the company will be associated with the three part of the business and the cost has been fully amortized consumption the transfer of goods to ZWZ and related units.
The cost has been fully amortization of the low value of perishable products including one-time cost of tooling, tooling, tools and other low value consumables, the specific amount of the purchase to
assess the value of.
2. The main evaluation content is as follows:
(1) the evaluation base date: August 31, 2016
(2) evaluation method: cost method
Stock Name:* ST Wazhou B Stock Code: 200706 No.: 2016-37 (3) assessment result summary table
Units: ten thousand yuan
|||||
|-|-|-|-|
|NO.|company|Original Value|Assessment value|
|1|Automotive Bearing Branch Company|670.67|113.65|
|2|Cage company|888.15|134.55|
|3|Rolling company|2,319.30|395.3|
|Total||3,878.12|643.5|

3. Basic information of the buyer
The buyers areWBGC’s newly established branches and subsidiaries, i.e. Wafangdian Bearing
Group Precision Roller Co., Ltd. (subsidiary), Wafangdian Bearing Group Precision Cage Co., Ltd.
(subsidiary), and Wafangdian Bearing Group Premier Automotive Bearing Co., Ltd. (Branch Company). Because above companies are founded in less than a year, the investors WBGC are introduced as follow:
Company Name: Wafangdian Bearing Group Corp.
Registered capital: 413,793,100 yuan
Legal representative: Meng Wei
Company Type: State-owned enterprise
Business scope: manufacturing and marketing of bearings, components and accessories of bearings, special tools of bearings, tooling, equipment, mechanical equipments, abrasives, toolings, casting, auto parts, motor parts and related industrial products; design, repair, maintenance and technical services of bearings; purchase and marketing of raw materials and auxiliary materials of bearing; plant rental and equipment rental.
Financial situation of the past year:
The audited financial situation of WBGC in 2015: Total assets are 3,547,637,492.19 yuan, net assets are 1,241,838,726.01 yuan, operating incomes are 714,658,810.29 yuan, and net profits attributable to owners of parent company are 68,062,752.06 Yuan.
III. Approval situation
1. The buyer are the company's largest shareholder WBGC or its wholly owned subsidiary,thus the sale of assets connected transaction.
2. This related transaction has been deliberated and unanimously approved by the 7th board of director 2nd meeting, the related directors Meng Wei, Zhang Xinghai, Chen Jiajun, Li Shi, Sun Maolin
and Sun Najuan avoided the deliberation on this matter, other directors all voted yes for this matter,
there was neither negative vote nor abstention vote. Thecompany’s independent directors have issued
Stock Name:* ST Wazhou B Stock Code: 200706 No.: 2016-37 the “Prior approval of independent directors" and made "Independentdirectors’ opinions" on this matter;
3. Above-mentioned business does not constitute a major asset restructuring;
4. This transaction still needs to get the approval of shareholders meeting, person affiliated with this related transaction will give up the rights to vote for this proposal at the shareholders meeting.
IV The impact of the transaction on the company
The assets for sale are needed to be assessed, the impact to the profits and losses of the current about 48 million Yuan.
V Independentdirectors’ opinions
Thecompany’s independent directors have issued the “Prior approval of independent directors" and made "independentdirectors’ opinions" on this matter, the independent directors think it effectively clean up the company's idle assets, improve operational quality of the company's assets, so it will neither damage thecompany’s interests nor the rights and interests of minority shareholders.
VI Other explanations
Except the proposal of selling the Shenyang agencies plant to WBGC and the proposal of selling low-value consumption goods whose cost have been amortized to WBGC automobile bearing branch, precision cage company, precision roller company, the other proposal have been approved by Dalian SASAC.
VII Documents available for reference
1. Resolution of the 7th board of director 2nd meeting of Wafangdian Bearing Co., Ltd.;
2. Prior approval of independent directors;
3. Independent Opinions;
4.assessment report
Hereby notify
Board of Directors of
Wafangdian Bearing Co., Ltd.
October 27 2016