Zhejiang United Investment Holdings Group Limited (SEHK:8366) entered into an agreement to acquire 50% stake in Zhejiang Qian Xiang Construction Company Limited from Chen Baogen and Gu Quanyao for approximately HKD 180 million (approximately CNY 150 million) on January 17, 2018. The consideration will be paid in cash and stock. Cash consideration of HKD 45 million (CNY 37.02) has been paid by Zhejiang United Investment Holdings Group Limited as deposit and the balance consideration will be paid by issuance of 198.11 million shares upon completion. The consideration shares when allotted and issued will rank pari passu in all respects with the existing shares in issue. Upon completion, Chen Baogen and Gu Quanyao will hold 33.5% and 16.5% stake in Zhejiang Qian Xiang Construction Company Limited. Zhejiang United Investment Holdings Group Limited intends to fund the cash consideration by its internal financial resources. Upon completion, Zhejiang Qian Xiang Construction Company Limited will become a subsidiary of Zhejiang United Investment Holdings Group Limited. In case the transaction gets terminated as a result of default on part of Zhejiang United Investment Holdings Group Limited, the deposit shall be forfeited and will not be refunded. In the event that completion does not occur for any other reason, the deposit shall be refunded within five business days. As of November 30, 2017, Zhejiang Qian Xiang Construction Company Limited reported net assets of CNY 10.54 million. The transaction is subject to approvals from government authority, approvals from third party, the approval of the stock exchange for the listing of the consideration shares, satisfactory due diligence, delivery to Zhejiang United Investment Holdings Group Limited of a call option agreement, the proxy and the assignment of dividends agreement being duly executed and completion of a restructuring of Zhejiang Qian Xiang Construction Company Limited. The transaction is exempt from shareholders’ approval. As of January 18, 2017, a supplemental agreement has been signed and confirmation or acknowledgement of the stock exchange that Zhejiang United Investment Holdings Group Limited shall following allotment and issuance of the consideration shares continue to have sufficient public float under the GEM listing rules has been included as a condition to the deal. The transaction is expected to complete within five business days of conditions being fulfilled or any other day as agreed upon. The long stop date is June 30, 2018.