China Ever Grand Financial Leasing : DISCLOSEABLE AND CONNECTED TRANSACTION ACQUISITION OF THE ENTIRE ISSUED SHARE CAPITAL OF THE TARGET COMPANY

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 379)

DISCLOSEABLE AND CONNECTED TRANSACTION ACQUISITION OF THE ENTIRE ISSUED SHARE CAPITAL OF

THE TARGET COMPANY

BACKGROUND

The Board is pleased to announce that on 8 January 2019 (after trading hours) the Purchaser, a wholly-owned subsidiary of the Company, the Vendor, the Vendor's Guarantor, and Great Wisdom entered into the Share Purchase Agreement, pursuant to which the Purchaser has conditionally agreed to purchase the Sale Share, which represent the entire issued share capital of the Target Company as at the date of Completion, in the Consideration of HKD90,000,000 from the Vendor. The Vendor's Guarantor has agreed to guarantee the due and punctual performance of the Vendor with its obligations under the Share Purchase Agreement. Upon Completion, the Target Company will become an indirect wholly-owned subsidiary of the Company. The Target Company, through its subsidiaries, (i) holds 100% interest in the Property, and (ii) is principally engaged in the research and studies and design of industrial biotechnology products, the wholesale of food additives and the provision of technology consultation services. The major assets owned by the Target Group include the Property, facilities and equipment used for research and studies of biotechnology.

LISTING RULES IMPLICATION

Each of the Vendor and Great Wisdom is a company, and the issued share capital of each of which is ultimately owned by the Vendor's Guarantor, the son of Mr. Wong Lik Ping, an executive Director and a substantial Shareholder. The Vendor, Great Wisdom and the Vendor's Guarantor are associates of Mr. Wong Lik Ping as defined under the Listing Rules, and, thus, connected persons of the Company as defined thereunder. The transactions contemplated under the Share Purchase Agreement constitute connected transactions of the Company under Chapter 14A of the Listing Rules and are therefore subject to the notification, announcement, circular and independent Shareholders' approval requirement under Chapter 14A of the Listing Rules.

As one or more of the applicable percentage ratio(s) (as defined in the Listing Rules) in respect of the transactions contemplated under the Share Purchase Agreement are more than 5% but lower than 25%, the transactions contemplated under the Share Purchase Agreement also constitute a discloseable transaction of the Company and is subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

Mr. Wong Lik Ping has abstained from voting on the relevant resolutions of the Board in accordance with the articles of association of the Company. Other than Mr. Wong Lik Ping, none of the other Directors is required to abstain from voting on the relevant resolution of the Board.

The EGM will be convened for the independent Shareholders to consider if thought fit, to approve the Share Purchase Agreement and the transactions contemplated thereunder. Pursuant to Rule 14A.36 of the Listing Rules, any Shareholder who has a material interest in the Share Purchase Agreement shall abstain from voting to approve the Share Purchase Agreement and the Acquisition at the EGM. As at the date of this announcement, Mr. Wong Lik Ping, being a substantial Shareholder of the Company, holds approximately 16.12% of the issued share capital of the Company and, will be required to abstain from voting on the relevant resolutions at the EGM accordingly. Save for Mr. Wong Lik Ping, as at the date of this announcement, to the best knowledge of the Directors, no other Shareholder would be required to abstain from voting thereat as no other Shareholder has any interest in the Share

Purchase Agreement which is different from the other Shareholders.

The Independent Board Committee, comprising all the independent non-executive Directors, namely Mr. Goh Choo Hwee, Mr. Ho Hin Yip and Mr. U Keng Tin, has been established to consider the terms of the Share Purchase Agreement and the transactions contemplated thereunder, and to advise the independent Shareholders as to whether they are on normal commercial terms, fair and reasonable and in the interests of the Company and the Shareholders as a whole.

None of the members of the Independent Board Committee has any interest or involvement in the transactions contemplated under the Share Purchase Agreement. The Independent Board Committee will form its view in respect of the terms of the Acquisition after obtaining and consideration the advice from the Independent Financial Adviser. Red Sun Capital Limited has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the independent Shareholders in this connection.

A circular containing, among other things, (i) information on the Acquisition; (ii) the

recommendation of the Independent Board Committee in respect of the Acquisition; (iii)

the advice of the Independent Financial Adviser regarding the terms of the Acquisition; (iv) the Property Valuation Report; (v) the Target Company Valuation Report; and (vi) other information as required under the Listing Rules, shall be despatched to the Shareholders on or before 1 February 2019, as additional time is required to prepare the information to be included in the circular.

Shareholders and potential investors of the Company should note that the Completion is subject to the fulfillment (or waiver, if applicable) of the Conditions Precedent, and the Completion may or may not proceed. Shareholders and potential investors of the Company are therefore advised to exercise caution when dealing in the Shares.

Reference is made to the announcement of the Company dated 2 November 2018. As disclosed in the announcement, the Purchaser and Great Wisdom entered into the MOU indicating the intention of the Purchaser and Great Wisdom to enter into the acquisition agreement in respect of the possible acquisition of 100% equity interest in Shanghai Lizu or assets of Shanghai Lizu during the exclusivity period. Upon further negotiation with the Vendor, the Vendor's Guarantor and Great Wisdom, it was agreed that the deal structure would be changed in a way that the Purchaser will acquire the entire issued share capital of the

Target Company, the holding company of Great Wisdom.

The Board is pleased to announce that on 8 January 2019 (after trading hours) the Purchaser, a wholly-owned subsidiary of the Company, the Vendor, the Vendor's Guarantor, and Great Wisdom entered into the Share Purchase Agreement, pursuant to which the Purchaser has conditionally agreed to purchase the Sale Share, which represent the entire issued share capital of the Target Company as at the date of Completion, in the Consideration of HKD90,000,000 from the Vendor. The Vendor's Guarantor has agreed to guarantee the due and punctual performance of the Vendor with its obligations under the Share Purchase Agreement. The major terms of the Share Purchase Agreement are summarised below:

THE SHARE PURCHASE AGREEMENT

Date

8 January 2019

Parties

(i) The Purchaser;

• (ii) The Vendor;

• (iii) The Vendor's Guarantor; and

• (iv) Great Wisdom.

Assets to be acquired

The Sale Share which represents the entire issued share capital of the Target Company.

Information about the Target Company

The Target Company is a limited liability company incorporated in the BVI. It is principally engaged in the research and studies and design of industrial biotechnology products, the wholesale of food additives and the provision of technology consultation services. The major assets owned by the Target Group include the Property, facilities and equipment used for research and studies of biotechnology.

Information about the Property

The Property is owned by Shanghai Lizu, a wholly-owned indirect subsidiary of the Target Company. The Property is located in Shanghai, the PRC at an industrial park named as "Caohejing Hi-Tech Park". The total gross floor area of the Property is 6,546.83 sq m. The land use rights of the Property have been granted for a term from 28 February 2007 to 27 February 2057 for industrial use.

FINANCIAL INFORMATION OF THE TARGET GROUP

Set out below is a summary of the consolidated unaudited financial information of the Target Group for the two years ended 31 December 2017 and 31 December 2018, respectively:

Net loss before taxation

For the	For the
year ended	year ended
31 December	31 December
2017	2018
RMB'000	RMB'000
5,744	15,528