First M&A Loan Activity Under New CBRC Guidelines: What Does The Future Hold?

Contents

1. M&A Loan Activity Since the New Guidelines Were Issued

2. The Substance of the New Guidelines

• What are the new Guidelines?
• Who can lend?
• Who can borrow?
• How will the loans be structured?

3. Outlook

• Why issue the Guidelines now?
• Who will benefit?
• Market potential

4. Conclusion

A number of acquisition loan arrangements have already been inked since the China Bank Regulatory Commission ("CBRC") issued new guidelines (the "Guidelines") on December 6, 2008 allowing commercial banks to provide loans to domestic enterprises conducting acquisitions within China and abroad.

In this legal update, we report on new merger and acquisition ("M&A") lending activity, describe the substance of the new Guidelines and what changes they bring, and offer an outlook on the effects the Guidelines will have.