Realord Group Holdings Limited (SEHK:1196) entered into an acquisition agreement to acquire Realord Investment Limited from Lin Xiaohui and Su Jiaohua for CNY 6.9 billion on January 18, 2018. The sellers own the business in proportion of 70% and 30%, respectively. Realord Group Holdings Limited will acquire equity stake and provide loan to Realord Investment Limited for settlement of its outstanding debts. As per terms, cash consideration will be payable first in the form of the loan to be provided to Realord Investment Limited and the balance will be used for payment of equity stake. The consideration for equity comprises cash between CNY 3 billion to CNY 3.6 billion payable at completion, issuance of 280.99 million new shares of Realord Group Holdings Limited, issuance of promissory notes of between CNY 1.4 billion to CNY 1.98 billion at completion and issuance of promissory notes of approximately CNY 100 million within 5 days of completion. Pursuant to the agreement, the exact amount of the cash consideration and the promissory notes payable before completion will be determined at discretion of Realord Group Holdings Limited before completion. The consideration as described is subject to adjustments. It is intended that the cash portion will be financed by way of bank and/or other facilities of Realord Group Holdings Limited. Post completion will operate as a wholly owned subsidiary of Realord Group Holdings Limited. As on August 31, 2017, Realord Investment Limited reported total assets of HKD 4.2 billion (CNY 3.5 billion) and net assets of HKD 12.4 million (CNY 10.4 million). The deal is subject to obtaining all necessary consents by Realord Group Holdings Limited, Lin Xiaohui and Su Jiaohua, obtaining bank and/or other facilities of not less than CNY 3 billion, approval from shareholders of Realord Group Holdings Limited, approval of listing from stock exchange, obtaining legal opinion issued by lawyers of Realord Group Holdings Limited and due diligence review. As of March 23, 2018, Realord Group Holdings Limited issued circular to its shareholders along with notice of extraordinary general meeting to be held on April 13, 2018. The Board of Directors and independent Board committee along with independent financial advisor recommended the shareholders to vote in favor of the transaction. As of April 13, 2018, Realord Group Holdings Limited shareholder approved the transaction. The deal will close on third day of fulfillment or waiving all conditions. Optima Capital Limited acted as financial advisor to Realord Group Holdings Limited while Veda Capital Limited acted as independent financial advisor to independent Board committee and independent shareholders of Realord Group Holdings Limited.