(c) The Board discussed China Yuchai's investment in Thakral Corporation Limited ("Thakral") and HL Global Enterprises Limited ("HLGE"). The Board informed the shareholders of its intention to divest its remaining stake in Thakral subject to market conditions. As disclosed in the Form 20-F for financial year 2012 which was filed by China Yuchai with the U.S. Securities and Exchange Commission on April 22, 2013, China Yuchai has, in early 2013, reduced its stake further in Thakral. China Yuchai currently has a 48.9% shareholding interest in HLGE and the Board will consider all options with regard to this investment in order to deliver value to shareholders.
(d) Related to paragraph (c) above was the suggestion by a shareholder to utilize the funds raised from a sale of the Company's stakes in Thakral and HLGE to implement a share buyback plan. The Board explained that China Yuchai needed to maintain a prudent level of cash for its operations and strategic plans. The Company's principal source of cash flow is its share of dividends paid by GYMCL, a majority of which, upon receipt is paid out to the Company's shareholders as dividends. The Board believes the payment of dividends gives the best value to shareholders compared with a share buyback plan.
(e) The Board also shared its thoughts with shareholders with regard to the suggestion that China Yuchai dual list its shares on the Hong Kong stock exchange. The Board believes that the New York Stock Exchange continues to be the most prestigious stock exchange in the world with the highest standards of corporate governance. There is no guarantee that a listing on another exchange will result in a higher valuation of China Yuchai's shares or will result in benefits commensurate with the additional costs of and risks arising from such a listing. As for a possible listing of the Company's joint ventures individually on the Hong Kong stock exchange, the Board will from time to time, evaluate and assess the viability of this option.
About China Yuchai InternationalChina Yuchai International Limited, through its subsidiary, Guangxi Yuchai Machinery Company Limited ("GYMCL"), engages in the manufacture, assembly, and sale of a wide array of light-duty, medium-duty and heavy-duty diesel engines for construction equipment, trucks, buses and cars in China. GYMCL also produces diesel power generators, which are primarily used in the construction and mining industries. Through its regional sales offices and authorized customer service centers, the Company distributes its diesel engines directly to auto OEMs and retailers and provides maintenance and retrofitting services throughout China. Founded in 1951, GYMCL has established a reputable brand name, strong research and development team and significant market share in China with high-quality products and reliable after-sales support. In 2012, GYMCL sold 431,350 diesel engines and is recognized as a leading manufacturer and distributor of diesel engines in China. For more information, please visit http://www.cyilimited.com For more information, please contact:
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