Qingdao Port International Co., Ltd. (SEHK:6198) entered into Asset Purchase Agreement to acquire an unknown majority stake in Rizhao Port Oil Terminal Co., Ltd., Rizhao Shihua Crude Oil Terminal Company Limited from SPG Rizhao Port Group Co., Ltd on June 30, 2023. The company will pay 4.81 billion yuan by issuing around 697.3 million class A shares, and 4.63 billion yuan will be paid in cash, Qingdao Port. Under the terms of agreement, the Company entered into (i) the Asset Purchase Agreement I with Rizhao Port Group, pursuant to which, the Company conditionally agreed to purchase 100% equity interests in Oil Company, 50.00% equity interests in Rizhao Shihua and 100% equity interests in Rizhao Gangrong held by Rizhao Port Group; and (ii) the Asset Purchase Agreement II with Yantai Port Group, pursuant to which, the Company conditionally agreed to purchase 67.56% equity interests in Yantai Port, 60.00% equity interests in Laizhou Port, 53.88% equity interests in United Pipeline, 64.91% equity interests in Ganghang Investment and 100% equity interests in Operation Guarantee Company held by Yantai Port Group. The Company proposed to pay the total consideration for the Proposed Restructuring by way of a combination of issuance of Consideration Shares and cash payments. The final consideration for the Proposed Restructuring will be determined with reference to the appraised value of the Target Assets after arm?s length negotiation between the Company and the Transferors and confirmed by way of entering into the Supplemental Agreements which shall be considered and approved by another Board meeting held in due course. The final number of Consideration Shares issued shall be subject to the documents registered by the CSRC. Upon the confirmation of the final consideration of the Proposed Restructuring, the Company will enter into the Supplemental Agreement with Rizhao Port Group and Yantai Port Group, respectively. The Company will timely comply with the reporting, announcement and Independent Shareholders? approval requirements (if applicable) under Chapter 14 and Chapter 14A of the Hong Kong Listing Rules. After the completion of the Proposed Restructuring, the claims and debts of each of the Target Companies will continue to be enjoyed and borne by each of the Target Companies. The Transferors should urge each of the Target Companies to take necessary actions to ensure that the Proposed Restructuring will not affect the realization and performance of such claims and debts.

The transaction is subject to approval of offer by acquirer board and target bowrd along with approval from Shandong SASAC shall approve the Proposed Restructuring; the SSE shall review and approve the Proposed Restructuring; the Proposed Restructuring shall be approved by the Board and the Shareholders? Meeting; the circular in relation to the Proposed Restructuring shall be approved by the Hong Kong Stock Exchange and the Proposed Restructuring shall obtain other necessary approvals or consents required by relevant laws and regulations. These steps are subject to shareholder approval as per the Hong Kong listing rules. The deal has been approved by the board. The proceeds to be raised from the Proposed Issuance of A Shares are intended to be used to (i) pay the cash consideration, relevant taxes, intermediary fees of the Proposed Restructuring; and (ii) replenish the Company?s working capital, the proportion of which to be used to replenish the Company?s working capital shall not exceed 25% of the total consideration for the Proposed Restructuring or 50% of the total amount of proceeds to be raised from the Proposed Issuance of A Shares.