The Board of Baoye Group Company Limited announces that on 22 July 2021, Yichang Baoye Mining Co. Ltd., a wholly-owned subsidiary of the Company, won the bid for the construction stone mining right in Caijiawan Mining Area, Yiling District, Yichang City for a term of 23 years, which covers a mining area of approximately 0.3323 square kilometer with resource reserve of approximately 52,848,000 tons, from the Natural Resources and Planning Bureau of Yiling, Yichang City through public online auction and bidding at a total consideration of RMB 371,613,000 (equivalent to approximately HKD 316,614,276). As one or more applicable percentage ratios (as defined in Rule 14.07 of the Listing Rules) in respect of the amount payable by Yichang Baoye Mining to the Vendor exceeds 5% and all the applicable percentage ratios are less than 25%, the Acquisition constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules and is therefore subject to the reporting and announcement requirements but is exempted from the independent shareholder's approval requirement under the Listing Rules.

Reference is made to the Results Announcement of the Company. As stated in the Results Announcement, Yichang Baoye Mining, a wholly-owned subsidiary of the Company acquired a construction stone mining right in Yichang City, Hubei Province at a total consideration of approximately RMB 371,613,000 (equivalent to approximately HKD 316,614,276) through public auction and bidding. On 28 May 2021, the Natural Resources and Planning Bureau of Yiling District, Yichang City, publicly listed the Mining Right through the website of the Yiling Government.

On 30 June 2021, Yichang Baoye Mining succeeded in bidding the Mining Right at a total consideration of RMB 371,570,000 (equivalent to approximately HKD 316,577,640). On 22 July 2021, Yichang Baoye Mining, a wholly owned subsidiary of the Company, and the Vendor entered into the Agreement pursuant to which Yichang Baoye Mining agreed to acquire from the Vendor the Mining Right.