Alibaba Health Information Technology : (1) DISCLOSEABLE AND CONNECTED TRANSACTION AND (2) CONTINUING CONNECTED TRANSACTIONS

February 06, 2020 at 05:08 pm EST

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.

This announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities, nor is it calculated to invite any such offer or invitation.

ALIBABA HEALTH INFORMATION TECHNOLOGY

LIMITED

阿里健康信息技術有限公司

(Incorporated in Bermuda with limited liability)

(Stock code: 00241)

DISCLOSEABLE AND CONNECTED TRANSACTION AND
1. CONTINUING CONNECTED TRANSACTIONS

THE PROPOSED ACQUISITION

The Board is pleased to announce that on February 6, 2020, the Company entered into the Share Purchase Agreement with Ali JK Nutritional Products Holding Limited, a direct wholly-owned Subsidiary of Alibaba Holding, pursuant to which the Company will acquire 100% of the equity interest in Ali JK ZNS Limited, an offshore holding vehicle incorporated under the laws of the British Virgin Islands which is indirectly wholly-owned by Alibaba Holding to hold the Target Business. The aggregate Consideration is HK$8.075 billion and will be satisfied by the Company issuing 860,874,200 Consideration Shares to the Vendor at Completion.

Completion is conditional upon, among other things:

the passing by the Independent Shareholders of the resolutions to approve the Proposed Acquisition and the non-exempt continuing connected transactions by the members of the Group as contemplated under the Framework Technical Services Agreement;
the approval of the Stock Exchange being granted for the listing of, and permission to deal in, the Consideration Shares; and
the completion of the Business Restructuring as further described below.

THE TARGET BUSINESS

The Target Business comprises (i) all Merchant relationships with the Target Merchants for the sale of Target Products and Services on the Tmall Platforms; and (ii) the employment relationships with relevant marketing and operations personnel managing the relationships with the Target Merchants.

The "Target Products and Services" are defined as the Tmall Products and Services and the Tmall Global Products and Services.

The "Tmall Products and Services" are comprised of the following products and/or services:

the Pharmaceutical Products sold on Tmall (including through Tmall Supermarket);
the Medical Purpose Food Products sold on Tmall (including through Tmall Supermarket); and
the Medical Devices, the Adult Products, the Healthcare Products, the Medical and Healthcare Services and the Target Blue Cap Health Food sold through Tmall Supermarket only.

The "Tmall Global Products and Services" are comprised of the following products and/or services sold on Tmall Global:

the Pharmaceutical Products;
the Medical Devices;
the Healthcare Products;
the Medical Purpose Food Products; and
the Medical and Healthcare Services.

THE FRAMEWORK TECHNICAL SERVICES AGREEMENT

Taobao Holding and the Company entered into the Framework Technical Services Agreement on February 6, 2020. Pursuant to the Framework Technical Services Agreement, Taobao Holding and its Subsidiaries will provide infrastructure technical support for the operation of the Tmall Platforms in respect of the Target Products and Services to the Company for the Tmall Software Service Fees. Subject to the approval of the Proposed Acquisition and the Framework Technical Services Agreement by the Independent Shareholders at the SGM, the term of the Framework Technical Services Agreement will commence on the day following Completion and end on March 31, 2023, unless otherwise mutually agreed between the parties.

IMPLICATIONS UNDER THE LISTING RULES

As one or more of the applicable percentage ratios in respect of the Share Purchase Agreement (including the alternative size test referred to in Rule 14.20) exceed 5% but are below 25%, the Share Purchase Agreement constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules. Perfect Advance is a Substantial Shareholder and a connected person of the Company. Alibaba Holding is the ultimate shareholder of Perfect Advance and the Vendor. Accordingly, the Vendor is a connected

person of the Company and therefore the Proposed Acquisition also constitutes a connected transaction of the Company and is subject to the approval of the Independent Shareholders at the SGM.

In addition, Taobao Holding is a Subsidiary of Alibaba Holding and therefore a connected person of the Company. The transactions contemplated under the Framework Technical Services Agreement will constitute continuing connected transactions for the Company under the Listing Rules. It is expected that the highest of the applicable percentage ratios in respect of the Framework Technical Services Agreement will be more than 5%. Accordingly, the transactions contemplated under the Framework Technical Services Agreement will constitute non-exempt continuing connected transactions subject to the reporting, announcement and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

Warning: The Company will despatch a circular on or before February 27, 2020 in accordance with the requirements under the Listing Rules. The circular will contain, among other things, further details of the Proposed Acquisition and related agreements, a letter of advice from the Independent Financial Adviser to the Independent Board Committee of the Company and the Independent Shareholders in relation to the Proposed Acquisition and the Framework Technical Services Agreement.

The completion of the Proposed Acquisition and commencement of the Framework Technical Services Agreement are subject to the satisfaction and/or waiver (where applicable) of conditions precedent as set out in the Share Purchase Agreement including but not limited to Independent Shareholders' approval, which may or may not be fulfilled. The Shareholders and potential investors of the Company are reminded to exercise caution when dealing in the Shares.

INTRODUCTION

The Board is pleased to announce that on February 6, 2020, the Company and the Vendor entered into the Share Purchase Agreement, pursuant to which the Company has conditionally agreed to acquire and the Vendor has conditionally agreed to sell, at Completion, the entire issued share capital of the Target Company in consideration for the issue of the Consideration Shares by the Company to the Vendor. On the same day, Taobao Holding entered into the Framework Technical Services Agreement with the Company.

The principal terms of the Share Purchase Agreement are set out as follows.

THE SHARE PURCHASE AGREEMENT

(1 ) D a te

February 6, 2020

( 2 ) Parties

The Company as the purchaser; and
Ali JK Nutritional Products Holding Limited as the Vendor.

The Vendor is a direct wholly-owned Subsidiary of Alibaba Holding, the ultimate majority shareholder of the Company. Accordingly, the Vendor is a connected person of the Company and the transaction contemplated under the Share Purchase Agreement will constitute a connected transaction under the Listing Rules.

The Proposed Acquisition

Pursuant to the Share Purchase Agreement, the Company has conditionally agreed to purchase and the Vendor has conditionally agreed to sell the entire issued share capital in the Target Company.

The Target Company is an offshore holding vehicle which is an indirect wholly-owned Subsidiary of Alibaba Holding. The Target Company, through the WFOE or the HK Subsidiary (as the case may be), will hold (i) the ownership and operation of all Merchant relationships with the Target Merchants for the sales of Target Products and Services on the Tmall Platforms and (ii) the employment relationships with the relevant marketing and operations personnel managing the relationships with the Target Merchants.

The "Target Products and Services" are defined as the Tmall Products and Services and the Tmall Global Products and Services.

The "Tmall Products and Services" are comprised of the following products and/or services.

the Pharmaceutical Products sold on Tmall (including through Tmall Supermarket);
the Medical Purpose Food Products sold on Tmall (including through Tmall Supermarket); and
the Medical Devices, the Adult Products, the Healthcare Products, the Medical and Healthcare Services and the Target Blue Cap Health Food sold through Tmall Supermarket only.

The "Tmall Global Products and Services" are comprised of the following products and/or services sold on Tmall Global:

the Pharmaceutical Products;
the Medical Devices;
the Healthcare Products;
the Medical Purpose Food Products; and
the Medical and Healthcare Services.

Upon Completion, the Target Company will become a direct wholly-owned Subsidiary of the Company, and the financial results of the Target Group will be consolidated into the Group's accounts.

The Consideration

The Consideration for the Share Purchase Agreement is HK$8.075 billion，which was determined after arm's length negotiations between the Company and the Vendor. The Consideration will be satisfied by the Company issuing 860,874,200 Consideration Shares to the Vendor. The Issue Price will be HK$9.38 per Consideration Share, subject to proportional adjustments in the event of a share split, share combination, share dividend or similar events with respect to the capital of the Company prior to Completion.

For a period of 18 months from Completion, the Vendor has agreed that it will not dispose of, nor enter into any agreement to dispose of or otherwise create any options, rights, interests or other third party rights in respect of the Consideration Shares issued to it without the Company's prior written consent. However, the Company's prior written consent will not be required where the person to whom any of the Consideration Shares issued to the Vendor are transferred also undertakes to (a) bear a pro rata portion of any liabilities of the Vendor for breach of its warranties under the Share Purchase Agreement and (b) be subject to this restriction in respect of any subsequent transfer by such transferee.

The Consideration Shares represent approximately 7.16% of the issued share capital of the Company as at the date of this announcement and approximately 6.68% of the issued share capital of the Company as enlarged by the issue of the Consideration Shares. Based on the current shareholding structure of the Company, the Company will continue to be able to satisfy the public float requirement under the Listing Rules following issue of the Consideration Shares.

No original acquisition cost was involved for the Target Business as Alibaba Holding established and grew the Target Business, and did not acquire it from a third party. The Consideration was arrived at after arm's length negotiations between the Company and the Vendor, taking into account various factors, including:

the GMV, financial performance and market position of the Target Business;
the growth potential of the Target Business;
the strategic value and operational expertise of the Target Business; and
the value to the Company of the New Deed of Non-competition, which will result in the Company having an exclusive relationship with the Target Merchants in respect of sales transactions of the DNC Restricted Products and the DNC Restricted Services (subject to the scope and certain exceptions detailed below).

The Issue Price

The Issue Price represents:

a discount of approximately 19.3% to the closing price of the Shares of HK$11.62

per Share as quoted on the Stock Exchange on the Last Trading Day;

a discount of approximately 15.5% to the average VWAP for the five consecutive trading days up to and including the Last Trading Day of approximately HK$11.10 per Share;
a discount of approximately 14.5% to the average VWAP for the ten consecutive trading days up to and including the Last Trading Day of approximately HK$10.97 per Share;
a discount of approximately 11.8% to the average VWAP for the fifteen consecutive trading days up to and including the Last Trading Day of approximately HK$10.64 per Share;
a discount of approximately 9.9% to the average VWAP for the twenty consecutive trading days up to and including the Last Trading Day of approximately HK$10.42 per Share;
a discount of approximately 6.0% to the average VWAP for the thirty consecutive trading days up to and including the Last Trading Day of approximately HK$9.98 per Share;
a discount of approximately 2.1% to the average VWAP for the forty-five consecutive trading days up to and including the Last Trading Day of approximately HK$9.58 per Share;
a premium of approximately 1.4% to the average VWAP for the sixty consecutive trading days up to and including the Last Trading Day of approximately HK$9.25 per Share; and
a premium of approximately 8.8% to the average VWAP for the ninety consecutive trading days up to and including the Last Trading Day of approximately HK$8.62 per Share.

The Issue Price was arrived at after arm's length negotiations between the Company and the Vendor, taking into account various factors, including:

the share price performance of the Company in the ninety trading days prior to the Last Trading Day; and
application of an appropriate discount for a substantial placing such as the one contemplated under the Share Purchase Agreement,

as well as the factors described above.

Completion and conditions precedent

Completion will take place on the Business Day immediately following the satisfaction or waiver of certain conditions precedent including:

the passing by the Independent Shareholders at a duly convened Shareholders' meeting of the Company of resolutions approving the Proposed Acquisition, including but not limited to, the issue of the Consideration Shares pursuant to the Share Purchase Agreement and the non-exempt continuing connected transactions by the members of the Group as contemplated under the Framework Technical Services Agreement;
the granting of the approval of the Stock Exchange for the listing of, and permission to deal in, the Consideration Shares;
the completion of the business restructuring as set out in a detailed plan agreed among the parties ("Business Restructuring") including the assignment to the
WFOE or the HK Subsidiary (as the case may be) of the relationships with at least 450 Existing Target Merchants;
the Vendor and/or its related companies having obtained all necessary consents and approvals from the relevant governmental or regulatory authorities or other third parties required for the transactions contemplated by the Business Restructuring and the execution and performance by the Vendor of the Share Purchase Agreement and the Proposed Acquisition;
the Company having obtained all necessary consents and approvals from the relevant governmental or regulatory authorities or other third parties required for the execution and performance by the Company of the Share Purchase Agreement and the Proposed Acquisition; and
no governmental authority in any relevant jurisdiction having enacted any laws, rules or regulations which might render Completion or the Business Restructuring or any part thereof unlawful.

The Company is entitled in its absolute discretion, by written notice to the Vendor, to waive the conditions precedent set out in paragraphs (c) and (d) above, either in whole or in part. The right of the Company to waive such conditions precedent provides the Company with the flexibility to allow the Proposed Acquisition to proceed if the Business Restructuring is implemented with minor deviations from the agreed plan.

The Vendor is entitled in its absolute discretion, by written notice to the Company, to waive the conditions precedent set out in paragraph (e) above, either in whole or in part.

If any of the conditions precedent sets out above has not been fulfilled (or waived) on or before June 30, 2020, or such later date as may be agreed in writing between the Company and the Vendor, the Share Purchase Agreement shall automatically terminate with immediate effect pursuant to its terms.

Business Restructuring

For each Existing Target Merchant, the Vendor has agreed to use all reasonable endeavors to procure the relevant parties to, as soon as reasonably practicable, to

the extent applicable, enter into a Tripartite Agreement among (i) such Existing Target Merchant, (ii) the WFOE or the HK Subsidiary (as applicable) and (iii) the Tmall Entities or Taobao China (as applicable) (the "Merchant Assignment").

Transition Period

If the Merchant Assignment of any Existing Target Merchant has not been completed as of Completion (such Target Merchant, the "Non-assignedTarget Merchant"), the Vendor shall continue to use reasonable endeavors to complete such Merchant Assignment as soon as reasonably practicable. For each of the Non- assigned Target Merchants, the Vendor shall, promptly after the Transition Period, pay or cause to be paid to the Company such portion of the software service fees actually received by the Tmall Entities and Taobao China (after all discounts, rebates and other incentives) from such Non-assigned Target Merchant in respect of the sale of Target Products and Services by such Non-assigned Target Merchant on Tmall during the Transition Period as would have been received by the Company less the relevant Tmall Software Service Fee had the Merchant Assignment of such Non-assigned Target Merchant been completed at or before Completion .

The Transition Period commences on the date of Completion and ends on the earliest of (i) completion of the Merchant Assignment of the Non -assigned Target Merchant, and (ii) the termination or expiration of the Existing Target Merchant Contract.

THE PROPOSED NEW DEED OF NON-COMPETITION

We refer to (a) the Company's announcement dated May 19, 2017 and circular dated June 12, 2017 in relation to the Initial Deed entered into between the Company and Alibaba Holding on June 30, 2017, and (b) the Company's announcement dated May 29, 2018 and circular dated July 16, 2018 in relation to the Second Deed entered into between the Company and Alibaba Holding on August 2, 2018 (together, the "Prior Deeds"). The Prior Deeds were entered into to ensure that there would be no competition between the business of the Group and the business of Alibaba Group (excluding the Group) with respect to the sales of certain restricted products and services.

In order to update and streamline the non-competition arrangements between the Company and Alibaba Holding, the parties have agreed on the form of the New Deed of Non-competition which is to be entered into between the Company and Alibaba Holding on or before Completion. The New Deed of Non-competition restates and amends the scope of the restricted products and services and supersedes the Prior Deeds.

The restricted products and services under the New Deed of Non-competition are comprised of the DNC Restricted Products and the DNC Restricted Services.

The "DNC Restricted Products" are comprised of the following products:

the Adult Products;
the Healthcare Products;
the Medical Devices;

the Pharmaceutical Products;
the Medical Purpose Food Products; and
the Target Blue Cap Health Food.

The "DNC Restricted Services" are comprised of the Medical and Healthcare Services.

The New Deed of Non-competition provides that, other than the Excluded Scope and the Permitted Scope, Alibaba Holding will not, and will procure that its Affiliates (excluding the Group) will not, directly or indirectly, alone or jointly with another person, in any form, engage in the Restricted Business during the Non-competition Period.

"Restricted Business" means facilitating sales transactions of:

DNC Restricted Products using a business-to-consumer (B2C) transaction model in the PRC; and
DNC Restricted Services on Tmall (including through Tmall Supermarket) and Tmall Global.

"Excluded Scope" means:

the facilitation of sales transactions of Adult Products on Tmall Global; and
the facilitation of sales transactions of DNC Restricted Products or DNC Restricted Services:
1. on Kaola;
2. on Taobao Marketplace by Taobao Marketplace merchants;
3. by Intime Retail (Group) Company Limited and its Affiliates on any platform other than the Tmall Platforms;
4. on any other platform acquired by Alibaba Holding following the date of the New Deed of Non-Competition; and
5. using takeaway delivery model ( 外賣模式) on Ele.me, Koubei and other platforms Controlled or to be Controlled by Alibaba Holding.

The Non-competition Period commences on Completion and ends on the earliest of:

the Shares ceasing to be listed on the Stock Exchange;
Alibaba Holding ceasing to beneficially own an aggregate of 30% or more of the voting securities of the Company;
the Company ceasing to be a subsidiary (as defined in the Listing Rules) of Alibaba Holding; or

Alibaba Holding no longer being the single largest Shareholder (aggregated with the Shares beneficially owned by persons acting in concert with Alibaba Holding).

The "Permitted Scope" includes:

the conduct of Restricted Business pursuant to any then -effective Existing Target Merchant Contract until the earlier of: (x) the expiration of such Existing Target Merchant Contract in accordance with its terms; and (y) the entering into a Tripartite Agreement in respect of such Existing Target Merchant Contract among (i) the DNC Target Merchant, (ii) the WFOE or the HK Subsidiary (as the case may be) and (iii) the Tmall Entities or Taobao China (as the case may be);
the conduct of activities pursuant to the terms of the Tripartite Agreements to be entered into among (i) the DNC Target Merchant, (ii) the WFOE or the HK Subsidiary (as the case may be) and (iii) the Tmall Entities or Taobao China (as the case may be);
the conduct of business activities pursuant to the terms of any framework technical services agreement entered into between Alibaba Holding (or its Affiliates) and the Company (or its Affiliates) relating to the DNC Restricted Products and DNC Restricted Services, including the collection of service fees thereunder; and
the conduct of any business with the Company's prior written consent.

Under the New Deed of Non-competition, Alibaba Holding undertakes, during the Non - competition Period, to cause its applicable Affiliates to (i) require that the DNC Target Merchants list the DNC Restricted Products and Services for sale on the Tmall Platforms (as the case may be and save as permitted within the Excluded Scope and the Permitted Scope) in accordance with any framework technical services agreement entered into between Alibaba Holding (or its Affiliates) and the Company (or its Affiliates) that is relating to the DNC Restricted Products and DNC Restricted Services, and (ii) use reasonable efforts to identify and remove from listing on the Tmall Platforms (as the case may be and save as permitted within the Excluded Scope and the Permitted Scope ) any DNC Restricted Product or DNC Restricted Service that is listed contrary to the requirement in (i) above. Alibaba Holding also undertakes, during the Non -competition Period, to ensure that any new business opportunities that it or its Affiliates (excluding the Group) identify, or are offered, which fall within the scope of the Restricted Business, are offered to the Company. Such new business opportunities will not be taken up by Alibaba Holding or its Affiliates (excluding the Group).

THE FRAMEWORK TECHNICAL SERVICES AGREEMENT

Subsidiaries will continue to provide access to its e-commerce platforms to the Target Merchants and incur operating costs for the provision of the technical services and the platforms. Taobao Holding and the Company entered into the Framework Technical Services Agreement on February 6, 2020 to set out the terms of services to be provided by Taobao Holding and its Subsidiaries and the relevant Tmall Software Service Fees.

The transactions contemplated under the Framework Technical Services Agreement constitute non-exempt continuing connected transactions for the Company under the Listing Rules. The principal terms of the Framework Technical Services Agreement are set out as follows.

(1 ) D a te

February 6, 2020

Parties
1. the Company (for itself and on behalf of its Subsidiaries and Affiliates); and
2. Taobao Holding (for itself and on behalf of its Subsidiaries and Affiliates).
Term and termination

Subject to the approval of the Proposed Acquisition and the Framework Technical Services Agreement by the Independent Shareholders at the SGM, the term of the Framework Technical Services Agreement will commence on the day following Completion and end on March 31, 2023, unless otherwise mutually agreed between the parties. The parties will determine whether to renew the Framework Technical Services Agreement 60 days before it expires.

Services to be provided

Pursuant to the terms of the Framework Technical Services Agreement, after Completion, Taobao Holding will procure its Subsidiaries, including the Tmall Entities and Taobao China, to continue to provide infrastructure technical support for the operation of the Tmall Platforms, including the following services:

Software technical support: Taobao Holding and its Subsidiaries will provide infrastructure technical support to the Company and its Affiliates or the Target Merchants as requested by the Company for the Tmall Software Service Fees. The infrastructure technical support includes product information display and Internet transaction services on the Tmall Platforms and related software technology services;
Internet information services and secondary domain names: As the platform provider and operator, Taobao Holding and its Subsidiaries will provide Tmall.com and Tmall.hk and the secondary domain names to the Target Merchants as a platform for the Target Merchant's operation of business; and
Other services: Taobao Holding and its Subsidiaries may provide the Target Merchants with additional services including but not limited to marketing services

and Merchant customer services on the Tmall Platforms. Taobao Holding and its Subsidiaries will not charge the Company for those services unless the Company requests such services where the parties will agree on a separate service fee.

From time to time the Tmall Entities and/or Taobao China may organize platform-wide promotional events in which they coordinate with the Merchants on the Tmall Platforms, including the Target Merchants through the Company, to offer discounts to consumers over a period of time and implement a number of customer loyalty programs to encourage repeat shopping.

Tmall Software Service Fee and annual caps

The Company shall pay the Tmall Software Service Fees to Taobao Holding and its Subsidiaries equal to 40% of the Company Software Service Fees received by the Company from the Target Merchants for transactions selling Pharmaceutical Products and 50% of the Company Software Service Fees received by the Company from the Target Merchants for transactions selling the Target Products and Services other than the Pharmaceutical Products (the "Other Target Products and Services") on the Tmall Platforms and utilizing services provided by Taobao Holding and its Subsidiaries. The Company Software Service Fees are currently up to 4% of the value of completed sales of Target Products and Services sold on the Tmall Platforms, and will be deducted from the receivables of the relevant Target Merchant and paid to the Company after a customer confirms the receipt of the products he or she purchases. The vice president of the finance department of the Company will cross-check the amount of the Tmall Software Service Fees being paid to Taobao Holding and its Subsidiaries on a monthly basis to ensure the accuracy of the amount.

The Tmall Software Service Fees shall be settled in cash on a monthly basis. The Tmall Software Service Fees are determined by reference to, among other things, the operating costs expected to be incurred by Taobao China and the Tmall Entities in providing the services including staff costs and technical support expenses.

The proposed annual caps (where applicable) in respect of the fees payable to Taobao Holding and its Subsidiaries under the Framework Technical Services Agreement are RMB262 million, RMB464 million and RMB799 million for each of the financial years ending March 31, 2021, 2022 and 2023, respectively.

The proposed annual caps for the applicable period in respect of the Framework Technical Services Agreement were arrived at after considering the historical revenue of Tmall attributable to the Target Business for recent financial years (i.e. RMB149 million and RMB192 million in the financial years ended March 31, 2018 and 2019, respectively), the projected revenue of Tmall for the Target Business, the Company's own projections for the Target Business based on projections for the growth of the overall healthcare market in China and the Company's marketing plans for enhancing the services that the Company seeks to provide to the Target Merchants.

Internal controls relating to the implementation of the Proposed Annual Caps

The Company has internal controls in place to monitor the implementation of the annual caps, including a written policy which sets out the proper steps for escalating

information regarding the usage of the proposed annual caps from the operating team to the executive officers, including monthly reports to the Company's chief executive officer, chief financial officer and general counsel and then to the independent non- executive Directors where required. The Company's operating team will have day-today interaction with the Target Merchants and will be able to closely monitor applicable GMV on a weekly basis. The Framework Technical Services Agreement includes a customary provision pursuant to which Taobao Holding agrees to allow the Company and its auditors access to information necessary to report on the non-exempt continuing connected transactions.

The Tripartite Agreements

In order to open a storefront on Tmall or Tmall Global, each of the Target Merchants has accepted the terms of an Existing Target Merchant Contract. As part of the Business Restructuring, the Vendor has agreed to use all reasonable endeavors to procure:

in respect of Target Merchants on Tmall, each of the relevant Target Merchants and the Tmall Entities to enter into a Tmall Tripartite Agreement with the WFOE; and
in respect of Target Merchants on Tmall Global, each of the relevant Target Merchants and Taobao China to enter into a Tmall Global Tripartite Agreement with the HK Subsidiary.

The Tmall Tripartite Agreements and the Tmall Global Tripartite Agreements (together, the "Tripartite Agreements") are ancillary implementation agreements to the Framework Technical Services Agreement.

The parties to the Framework Technical Services Agreement have agreed on the form of the Tripartite Agreements which is a supplemental agreement to the Existing Target Merchant Contract with respect to Target Products and Services.

Pursuant to the terms of the Tripartite Agreements, the WFOE or the HK Subsidiary (as the case may be) will provide e-commerce platform maintenance related software services to the Target Merchants for a fee. Those services involve the: (i) Merchants admission system; (ii) product quality control system; and (iii) Merchants operational and maintenance services system. They include:

tracking market trends and policy updates and updating Merchants on material policy updates;
Merchant business operation and management, including handling certain matters relating to signing and renewal of tripartite agreements with (i) the Target Merchants and (ii) the Tmall Entities and Taobao China (as applicable), reviewing product information and images displayed by Merchants, reviewing the documents required for Merchants' admission, formulating and implementing quality control rules and conducting regular inspections;
Merchant customer services, including providing helpline support for Merchants on the process of admission to the Tmall Platforms and general operational questions; assisting Merchants in optimizing searches for their products through

their product information display, collating and analyzing consumer behavior data, updating Merchants on any new business rules, upcoming marketing activities, business risks, as well as collecting feedback and suggestions from Merchants to improve overall services to Merchants;

marketing event planning for Merchants, including planning and organizing marketing events for Merchants, organizing Merchants to participate in events, designing and building event webpage interfaces, planning customer discount programs and conducting consumer data analysis;
in respect of Pharmaceutical Products, prescription processing and safety and risk management systems and services; and
technical support, including providing technical support on product information display and store design, transaction completion processes, the use of payment tools, consumer service tools (such as the use of chat windows or complaints forms).

The Tmall Entities and Taobao China will provide the Target Merchants with: (i) information display services on the platform and Merchant's storefronts; (ii) software technology services in respect of the credit points system on the Tmall Platforms; and

the secondary domain names for the Target Merchants. The Merchants can seek general customer service support from the Tmall Entities and Taobao China, for instance, in relation to technical issues encountered on the Tmall Platforms.

THE 2020 OUTSOURCED SERVICES AGREEMENT

We refer to the Company's announcement dated January 30, 2019 and circular dated March 13, 2019 in relation to the 2020 Outsourced Services Framework Agreement entered into between Taobao Holding and Alibaba Health Beijing (an indirect wholly-owned Subsidiary of the Company). Under the 2020 Outsourced Services Framework Agreement, Alibaba Health Beijing agreed to provide Taobao Holding with certain outsourced and value-added services in relation to certain Target Products and Services which relate to the Target Business that is proposed to be transferred to the Group under the Proposed Acquisition.

Following Completion, Taobao Holding will no longer require the outsourced and value-added services provided under the 2020 Outsourced Services Framework Agreement relating to the Target Products and Services on Tmall. In the event that Completion occurs before the expiration of the 2020 Outsourced Services Framework Agreement on March 31, 2020, Taobao Holding and Alibaba Health Beijing will enter into an amendment agreement to amend the scope of the 2020 Outsourced Services Framework Agreement. The Company will comply with the relevant requirements under Chapter 14A of the Listing Rules in respect of such amendment agreement.

APPLICATION FOR LISTING OF THE CONSIDERATION SHARES

The Company will apply to the Listing Committee for the listing of, and permission to deal in, the Consideration Shares to be allotted and issued pursuant to the Share Purchase Agreement.

EFFECT OF THE PROPOSED ACQUISITION ON THE SHAREHOLDING STRUCTURE OF THE COMPANY

The following table illustrates the shareholding structure of the Company: (i) as at the date of this announcement; and (ii) immediately after Completion (assuming there is no change in the issued share capital of the Company other than the issue of the Consideration Shares between the date of the Share Purchase Agreement and Completion).

As at the date of this	Immediately after
announcement	Completion
Number of Shares %	Number of Shares %

-	Perfect Advance	3,103,816,661	25.80	3,103,816,661	24.08
-	Ali JK Nutritional	3,699,911,207	30.76	4,560,785,407	35.38
	Products Holding
	Limited
-	Innovare Tech Limited	1,232,811,347	10.25	1,232,811,347	9.56
-	Antfin (Hong Kong)	60,576,000	0.50	60,576,000	0.47
	Holding Limited
-	Directors of the	5,154,019	0.04	5,154,019	0.04
	Company
-	Other shareholders	3,927,508,682	32.65	3,927,508,682	30.47
Total	12,029,777,916(*)	100%	12,890,652,116	100%

Since the last monthly return submitted by the Company under Rule 13.25B of the Listing Rules, the Company had issued a total of 72,000 Shares due to the exercise of share options by certain employees of the
Company under the Company's share award scheme. Such options were not exercised by a Director and hence a next day disclosure return was not submitted by the Company under Rule 13.25 A (1) of the Listing Rules.

INFORMATION ON THE TARGET GROUP AND THE TARGET BUSINESS

The Target Company is an offshore holding vehicle incorporated in the British Virgin Islands and an indirect wholly-owned Subsidiary of Alibaba Holding. The Target Company, through the WFOE or the HK Subsidiary (as applicable), will hold the Target Business after the Business Restructuring.

The Target Business comprises (i) all Merchant relationships with the Target Merchants for the sales of Target Products and Services on the Tmall Platforms and (ii) the employment relationships with relevant marketing and operations personnel managing the relationships with the Target Merchants. The Target Business generated a GMV of approximately RMB9,575 million and had approximately 35.8 million annual active buyers for the financial year ended March 31, 2019. As of January 31, 2020, the Target Business had more than 530 Target Merchants authorized by the Tmall Entities and Taobao China to sell Target Products and Services on the Tmall Platforms.

Based on the unaudited financial information of the Target Business prepared in accordance with HKFRS as of March 31, 2019, the net asset value of the Target Business was nil. Set out below is the key unaudited financial information of the Target Business for each of the financial years ended March 31, 2018 and 2019.

	For the year ended March 31,
	2018	2019
	(RMB'000)	(RMB'000)
Revenue	148,577	191,805
Gross profit (*)	75,863	97,927
Profit before taxation(*)	55,356	70,180
Net profit(*)	47,052	59,653

The gross profit, profit before taxation and net profit are adjusted on the assumption that the Framework Technical Services Agreement was in effect from April 1, 2017. The adjustments include (i) 40% of the Company Software Service Fees received from the Merchants that would have been paid to Taobao Holding in respect of Pharmaceutical Products and 50% of the Company Software Services Fees received from the Merchants that would have been paid to Taobao Holding in respect of the Other Target Products and Services; (ii) expenses originally accounted for by the Target Business namely marketing and customer acquisition expenses, traffic acquisition costs, co-location and bandwidth costs, other costs of service, depreciation recharges and reallocation expenses were excluded; and (iii) sales taxes and surcharges and income tax expense were recalculated based on adjusted financial information with applicable tax rate.

By acquiring the Target Business, the Company intends to provide value-added services to the Target Merchants after Completion to deliver more healthcare-focused solutions to the Target Merchants and improve their user experience as it has been the intention to develop the Company into the healthcare flagship of Alibaba Holding. Those value-added services will include:

tracking market trends and policy updates and updating Merchants on material policy updates. For example, the WFOE or the HK Subsidiary (as applicable) will update Merchants on any policy changes and provide analysis of how such changes might impact Merchants' business, and on trends to help Merchants identify opportunities or areas to focus on in their business;
Merchant customer services, including providing helpline support for Merchants on the process of admission to the Tmall Platforms and general operational questions; assisting Merchants in optimizing searches for their products through their product information display, collating and analyzing consumer behavior data, updating Merchants on any new business rules, upcoming marketing activities, business risks, as well as collecting feedback and suggestions from Merchants to improve overall services to Merchants. For example, the Group will assist Merchants to optimize searches for their products through using more intuitive or popular key words of product functions in the product names, increase cross-selling opportunities by analyzing overall customer purchase trends and making customized recommendations to consumers and increase repeat custom by recommending certain promotions for repeat purchases. As part of the store design services, the Group can also provide tailored suggestions such as how to use banner designs to drive brand recognition, better placement of the latest promotions on the storefront to increase user clicks, and tab design based on

functionality and to emphasize brand recognition;

marketing event planning for Merchants, including planning and organizing marketing events for Merchants, organizing Merchants to participate in events, designing and building event webpage interfaces, planning customer discount programs and conducting consumer data analysis. For example, the Group will plan special marketing events around certain themes such as around hot and cold seasons, or at the same time as specific awareness days such as World Cancer Day or World Diabetes Day, as well as conduct consumer data analysis to provide feedback on the performance of the sales of products or services which Merchants have selected to participate in the marketing events as well as the amount of resultant traffic to the Merchants' stores;
in respect of Pharmaceutical Products, prescription processing and risk management services, including prescription processing software services (as applicable) and rational use of drugs system services etc.; and
technical support, including providing technical support on product information display and store design, transaction completion processes, the use of payment tools, consumer service tools (such as the use of chat windows or complaints forms).

Set out below is a chart illustrating the operation model of the Target Business after Completion:

					Step 4A:
					Alipay releases funds (net of
					the Company Software Service
					Fees) to Target Merchants
				Target Merchants

		Step 2

		Consumers receive products
		from the Target Merchants

				Consumers		Alipay
					Step 3:
Tmall or Tmall	Step 1

Consumers confirm receipt of
Global (as applicable)	Consumers browse products,
goods in satisfactory condition or
		place orders and choose
		fail to object to the release of funds
		payment method on Tmall
		within a specified period
	Step 5:	and Tmall Global


	The Company pays the Tmall Software Service Fees = 40% of
	the Company Software Services Fees in respect of
	Pharmaceutical Products and 50% of the Company Software
	Service Fees in respect of the Other Target Products and
	Services sold on the Tmall Platforms to Taobao Holding

WFOE or the HK Subsidiary (as		Step 4B:
	applicable)		Alipay releases the Company
(Subsidiaries of the Target Company)		Software Service Fees in respect of
					Target Products and Services sold on

					the Tmall Platforms to the Company

INFORMATION ON THE COMPANY AND THE GROUP

The Company was incorporated in Bermuda and the Shares are listed on the Main Board of the Stock Exchange. The Company is an investment holding company and the Group is committed to providing Internet technology, service tools and platforms to industry partners, with the aim of providing accessible and affordable medical and healthcare services to the public so as to make good health achievable at the fingertips. The principal activities of the Group comprise the sale of pharmaceutical and healthcare products and services and the provision of Internet-based medical services, consumer healthcare services and intelligent medicine services, provision of tracking services and other innovative services.

INFORMATION ON THE VENDOR AND ALIBABA HOLDING

The Vendor is an offshore holding vehicle incorporated in the British Virgin Islands to hold the Target Company and it is directly wholly-owned by Alibaba Holding.

Alibaba Holding is a company incorporated in the Cayman Islands, with its American depositary shares, each representing eight ordinary shares, listed on the New York Stock Exchange (Stock Symbol: BABA), and its ordinary shares listed on the Main Board of the Stock Exchange (Stock Code: 9988). Alibaba Group's mission is to make it easy to do business anywhere. Alibaba Group aims to build the future infrastructure of commerce and envisions that its customers will meet, work and live at Alibaba, and it aspires to be a company that will last for 102 years. Alibaba Group's businesses are comprised of core commerce, cloud computing, digital media and entertainment and innovation initiatives.

INFORMATION ON THE TMALL ENTITIES, TAOBAO HOLDING AND TAOBAO CHINA

Zhejiang Tmall Network Co., Ltd* (浙江天貓網絡有限公司) is a company incorporated under the laws of the PRC and ultimately Controlled by Alibaba Holding, which is primarily involved in the operation of Tmall.

Zhejiang Tmall Technology Co., Ltd* (浙江天貓技術有限公司) is a company incorporated under the laws of the PRC and an indirect wholly-owned Subsidiary of Alibaba Holding, which is primarily involved in the operation of Tmall.

Taobao China Holding Limited ( 淘寶中國控股有限公司 ), a limited liability company incorporated in Hong Kong and an indirect wholly-owned Subsidiary of Alibaba Holding, which is the holding company of certain PRC Subsidiaries of Alibaba Holding relating to Taobao Marketplace and Tmall.

Taobao Holding Limited, a limited liability company incorporated in the Cayman Islands and a wholly-owned Subsidiary of Alibaba Holding. Taobao Holding is the indirect holding company of certain PRC Subsidiaries of Alibaba Holding relating to Taobao Marketplace and Tmall.

Tmall was launched by Alibaba Group in 2008 as an online platform featuring brands and retailers. Tmall caters to consumers looking for high-quality products and a premium shopping experience. It is a trusted platform for consumers to buy both homegrown and international branded products and products not available in traditional retail outlets. Brands and retailers operate their own stores on the Tmall platform with unique brand identities and look and feel, accompanied by full control over their own branding and merchandising. A large number of

international and Chinese brands and retailers have established storefronts on Tmall.

Tmall Global was launched by Alibaba Group in 2014 to address increasing Chinese consumer demand for international products and brands. Tmall Global serves as the premier platform through which overseas brands and retailers reach Chinese consumers, build brand awareness and gain valuable consumer insights in forming their overall China strategy, without the need for physical operations in China.

REASONS FOR AND BENEFITS OF THE PROPOSED ACQUISITION AND THE FRAMEWORK TECHNICAL SERVICES AGREEMENT

As previously disclosed by the Company, the Company's mission is to build an online community where it will connect participants in China's healthcare market, so as to provide users with better medical and healthcare services, to gradually realize Alibaba Group's "Double H" strategy. As always, Alibaba Holding will continue to support the Company's development as its healthcare flagship platform and will continue to explore various cooperation models, to help the Company achieve its goals.

The Company believes that its acquisition of the Target Business will enable it to: (a) further develop into Alibaba Group's only healthcare flagship platform; (b) bring in an even broader set of Merchants into the online healthcare community to enrich the ecosystem, and to organically complement and supplement the Company's four main businesses: pharmaceutical e-commerce, Internet healthcare, intelligent medicine and product tracking platform services; and (c) obtain more stable and sustainable revenue growth. The Proposed Acquisition represents an important step in the Company's ongoing development of its healthcare related e-commerce platform business. The Target Business, like many technology companies and the Company's own businesses, is an "asset-light" business. In the Board's view, the Consideration is fair and reasonable notwithstanding the low asset value of the Target Business.

Before the Proposed Acquisition, Taobao Holding (through its Subsidiaries, including the Tmall Entities and Taobao China) incurred costs to service the Target Merchants and provide the technical services and platforms where they sold Target Products and Services. Following Completion, Taobao Holding and its Subsidiaries will continue to incur operating costs for the provision of these technical services and provision of the platforms. Therefore, the Tmall Software Service Fees will be payable to Taobao Holding and its Subsidiaries. The Company considers the Framework Technical Services Agreement is necessary as a result of the Merchant relationships in respect of Target Products and Services being assigned to the Company from Alibaba Holding and because the technical support and services from Taobao Holding and its Subsidiaries to the Company are crucial to allow the Target Merchants to operate on these platforms.

The Directors (including the independent non-executive Directors) are of the view that the terms of the Share Purchase Agreement and the Framework Technical Services Agreement are fair and reasonable, on normal commercial terms and in the interests of the Company and the Shareholders as a whole.

LISTING RULES IMPLICATIONS

As one or more of the applicable percentage ratios in respect of the Share Purchase Agreement (including the alternative size test referred to in Rule 14.20) exceed 5% but are below 25%, the

Share Purchase Agreement constitutes a discloseable transaction of the Company under Chapter 14 of the Listing Rules. Perfect Advance is a Substantial Shareholder and a connected person of the Company. Alibaba Holding is the ultimate shareholder of Perfect Advance and the Vendor. Accordingly, the Vendor is a connected person of the Company and therefore the Proposed Acquisition also constitutes a connected transaction of the Company and is subject to the approval of the Independent Shareholders at the SGM.

As Mr. WU Yongming, Mr. WANG Lei, and Mr. XU Hong are employees of Alibaba Holding or its Subsidiaries, each of these Directors is deemed or may be perceived to have a material interest in the transactions contemplated under the Proposed Acquisition and the Framework Technical Services Agreement. Accordingly, they have abstained from voting on the board resolutions in connection with the Proposed Acquisition and the continuing connected transactions under the Framework Technical Services Agreement. Other than the aforesaid Directors, no other Directors have a material interest in the Proposed Acquisition or the continuing connected transactions under the Framework Technical Services Agreement and are not required to abstain from voting on the board resolutions approving the same.

The SGM will be convened by the Company to propose ordinary resolutions seeking approval from the Independent Shareholders by way of poll for: (i) the Share Purchase Agreement and the connected transaction contemplated thereunder, (ii) the issue of the Consideration Shares under specific mandate and, (iii) the Framework Technical Services Agreement and the non- exempt continuing connected transactions contemplated thereunder. To the best knowledge, belief and information of the Directors, having made all reasonable enquiries, as at the date of this announcement, each of Perfect Advance, the Vendor and Antfin (Hong Kong) Holding Limited holds 3,103,816,661 Shares, 3,699,911,207 Shares and 60,576,000 Shares respectively, representing approximately 25.80%, 30.76% and 0.50%, of the issued share capital of the Company. This in aggregate represents a total of 6,864,303,868 Shares and approximately 57.06% of the issued share capital of the Company. Each of Perfect Advance, the Vendor, Antfin (Hong Kong) Holding Limited and their associates, will abstain from voting in relation to the ordinary resolutions to be put forward at the SGM. Save as disclosed above, no other Shareholder is required to abstain from voting on the above ordinary resolutions.

INDEPENDENT BOARD COMMITTEE AND INDEPENDENT FINANCIAL ADVISER

The Company has established an Independent Board Committee comprising of all the independent non-executive Directors to advise the Independent Shareholders in connection with the approval of the Share Purchase Agreement, the Framework Technical Services Agreement and the connected transactions contemplated thereunder. Platinum has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

DESPATCH OF CIRCULAR

A circular containing, among other things:

further details of the Share Purchase Agreement;
further details of the Framework Technical Services Agreement;
the advice and recommendations of the Independent Board Committee;
the advice and recommendations of the Independent Financial Adviser; and
notice of the SGM,

will be despatched to the Shareholders on or before February 27, 2020 in accordance with the requirements of the Listing Rules.

WARNING

The completion of the Proposed Acquisition and commencement of the Framework Technical Services Agreement are subject to the satisfaction and/or waiver (where applicable) of conditions precedent of the Share Purchase Agreement including but not limited to Independent Shareholders' approval, which may or may not be fulfilled. Shareholders and potential investors of the Company are reminded to exercise caution when dealing in the Shares.

DEFINITIONS

In this announcement, save as the context otherwise requires, the defined terms shall have the following meanings:

"2020 Outsourced Services	the agreement dated January 30, 2019 between Alibaba
Framework Agreement"	Health Beijing and Taobao Holding in relation to the
	provision of Merchant Services
"Adult Products"	appliances and non-ingestible products that primarily
	enhance human sexual pleasure, and being appliances
	and non-ingestible products which are primarily sold
	under the primary category "Adult Products/Sexual
	Health Products" ("成人用品/ 情趣用品") under the
	business category "Healthcare Products and Medicine"
	(" 保健品及醫藥 ") on Tmall, but excluding (a) any
	general perfume products; (b) any general underwear,
	apparel and accessory products; and (c) any general
	furniture products
"Affiliates"	(a) for any person that is an individual, his or her
	Immediate Family Members, and (b) for any person that
	is not an individual, any other person that directly or
	indirectly through one or more intermediaries, Controls,
	21

	or is Controlled by, or is under common Control with,
	such person; provided, however, that for the purposes of
	this announcement, the Vendor and its Affiliates (other
	than the Company and its Subsidiaries), on the one hand,
	and the Company and its Subsidiaries, on the other hand,
	shall not be deemed to be Affiliates of each other
"Alibaba Group"	a group of companies comprising Alibaba Holding and
	its Subsidiaries, but, for the purpose of this
	announcement, excluding the Group
"Alibaba Health Beijing"	Alibaba Health Information Technology (Beijing) Co.,
	Ltd.* ( 阿里健康信息技術（北京）有限公司 ), a
	company established in the PRC and an indirect wholly-
	owned Subsidiary of the Company
"Alibaba Holding"	Alibaba Group Holding Limited, a company
	incorporated in the Cayman Islands, the ultimate
	controlling shareholder of the Company, with its
	American depositary shares, each representing eight
	ordinary shares, listed on the New York Stock Exchange
	(Stock Symbol: BABA), and its ordinary shares listed on
	the Main Board of the Stock Exchange (Stock Code:
	9988)
"Alipay"	Alipay.com Co., Ltd.* (支付寶(中國)網絡技術有限公
	司), a company incorporated under the laws of the PRC
	and which is a wholly-owned subsidiary of Ant Financial
"Ant Financial"	Ant Small and Micro Financial Services Group Co.,
	Ltd.* (浙江螞蟻小微金融服務集團股份有限公司), a
	company organized under the laws of the PRC; starting
	from September 2019, Alibaba Holding has held a 33%
	equity interest in Ant Financial
"Blue Cap Health Food"	food products that are registered (註冊) or filed (備案),
	from time to time, with the SAMR as "health food" ("保
	健食品 ") in accordance with the Health Food
	Registration and Filing Administrative Rules (《保健食
	品註冊與備案管理辦法》) and Food Safety Law of the
	PRC (《中華人民共和國食品安全法》) (as such laws
	and regulations may be amended from time to time) and
	have obtained a health food label ("blue cap") ("藍帽子
	") with a unique registration or filing tracking number
"Board"	the board of Directors
"Business Day"	any day (other than a Saturday or Sunday or public
	holiday) on which banks in Hong Kong, the PRC,
	22

	Bermuda and the British Virgin Islands are open for the
	transaction of normal business
"Business Restructuring"	has the meaning given to it in the sub-section "The Share
	Purchase Agreement - (6) Completion and conditions
	precedent" of this announcement
"Company"	Alibaba Health Information Technology Limited, an
	exempted company incorporated in Bermuda with
	limited liability and the shares of which are listed on the
	Main Board of the Stock Exchange (stock code: 00241)
"Company Software Service	the software service fees received by the Company from
Fees"	the Target Merchants for transactions selling Target
	Products and Services on the Tmall Platforms and
	utilizing services provided by Taobao Holding (through
	the Tmall Entities and Taobao China) which is equal to
	up to 4% of the value of completed sales of Target
	Products and Services sold on the Tmall Platforms and
	which will be deducted from the receivables of the
	relevant Target Merchant and paid to the Company after
	a customer confirms the receipt of the products he or she
	purchases
"Completion"	the completion of the sale and purchase of the entire
	issued share capital of the Target Company under the
	Share Purchase Agreement
"connected person"	has the meaning ascribed to it under the Listing Rules
"Consideration"	the total consideration of HK$8.075 billion for the
	Proposed Acquisition
"Consideration Shares"	860,874,200 Shares in aggregate to be issued to the
	Vendor pursuant to the Share Purchase Agreement
"Control"	the power or authority, whether exercised or not, to direct
	the business, management and policies of such person,
	directly or indirectly, whether through the ownership of
	voting securities, by contract or otherwise, which power
	or authority shall conclusively be presumed to exist upon
	possession of beneficial ownership or power to direct the
	vote of more than fifty per cent (50%) of the votes
	entitled to be cast at a meeting of the members or
	shareholders of such person or power to control the
	composition of a majority of the board of directors (or
	similar governing body) of such person and the term
	"Controlled" shall be construed accordingly
"Director(s)"	director(s) of the Company

"DNC Restricted Products"	the following products and/or services:
	•	Adult Products;
	•	Healthcare Products;
	•	Medical Devices;
	•	Pharmaceutical Products;
	• Medical Purpose Food Products; and
	• Target Blue Cap Health Food
"DNC Restricted Services"	Medical and Healthcare Services
"DNC Target Merchant"	a Merchant who has obtained, or proposes to obtain,
	permission from Tmall or Tmall Global (or their
	respective Affiliates) to sell DNC Restricted Products
	and DNC Restricted Services on Tmall or Tmall Global
	(as applicable), regardless of whether any actual sales of
	DNC Restricted Products and DNC Restricted Services
	have been made by such Merchant on those platforms
"Ele.me"	the on-demand delivery and local services platform
	known as Ele.me ( 餓了麼 ) operated by Alibaba
	Holding's Affiliates
"Excluded Scope"	(A) the facilitation of sales transactions of Adult
		Products on Tmall Global; and
	(B) the facilitation of sales transactions of DNC
		Restricted Products or DNC Restricted Services:
		(i)	on Kaola;
		(ii)	on Taobao Marketplace by Taobao
			Marketplace merchants;
		(iii)	by Intime Retail (Group) Company
			Limited and its Affiliates on any
			platform other than the Tmall Platforms;
		(iv)	on any other platform acquired by
			Alibaba Holding following the date of
			the New Deed of Non-Competition;
			and
		(v)	using takeaway delivery model (外賣模
			式) on Ele.me, Koubei and other
			platforms Controlled or to be Controlled
			by Alibaba Holding
"Existing Target Merchant"	a Target Merchant which is party to an Existing Target
	Merchant Contract as of the date of the Share Purchase

	Agreement
"Existing Target Merchant	in respect of a Target Merchant, (a) the existing services
Contract"	agreement between the Tmall Entities and such Target
	Merchant that permits the sale of Target Products and
	Services by such Target Merchant on Tmall or (b) the
	existing services agreement between Taobao China
	(and/or its applicable Affiliate(s)) and such Target
	Merchant that permits the sale of Target Products and
	Services by such Target Merchant on Tmall Global
"Framework Technical Services	the framework technical services agreement dated
Agreement"	February 6, 2020 between the Company and Taobao
	Holding
"GMV"	the value of confirmed orders of products and services on
	Alibaba Group's relevant marketplaces or specifically on
	the Tmall Platforms with respect to the Target
	Merchants, as applicable, regardless of how, or whether,
	the buyer and seller settle the transaction. Unless
	otherwise stated, GMV in reference to Alibaba Group's
	market places includes only GMV transacted on its
	China retail marketplaces. GMV generated from traffic
	through Juhuasuan is recorded as either Taobao
	Marketplace GMV or Tmall GMV depending on which
	of these two marketplaces the transaction is completed.
	The calculation of GMV for Alibaba Group's China
	retail marketplaces or specifically on Tmall with respect
	to Target Merchants, as applicable, includes shipping
	charges paid by buyers to sellers. As a prudential matter
	aimed at eliminating any influence on the GMV of
	potentially fraudulent transactions, Alibaba Group
	excludes from its calculation of GMV transactions in
	certain product categories over certain amounts and
	transactions by buyers in certain product categories over
	a certain amount per day
"Group"	the Company and its Subsidiaries (after Completion,
	including the Target Group)
"Healthcare Products"	non-ingestible products which are used in the lives of
	people and that have specific functions such as regulating
	the functions of the human body and promoting health,
	and being non-ingestible products which are primarily
	sold on the secondary category "Healthcare Products" ("
	保健用品") under the primary category "Internet-based
	Medical/Health Products" ("互聯網醫療/保健用品")
	under the business category of "Healthcare Products and
	Medicine" ("保健品及醫藥") on Tmall

"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"HKFRS"	Hong Kong Financial Reporting Standards
"HK Subsidiary"	Ali JK ZNS (HK) Limited, a company duly established
	and existing under the laws of Hong Kong and a wholly-
	owned Subsidiary of the Target Company
"Hong Kong"	the Hong Kong Special Administrative Region of the
	PRC
"Immediate Family Members"	for any natural person, (a) such person's spouse, parents,
	parents-in-law, grandparents, children, grandchildren,
	siblings and siblings-in-law (in each case whether
	adoptive or biological), (b) spouses of such person's
	children, grandchildren and siblings (in each case
	whether adoptive or biological) and (c) estates, trusts,
	partnerships and other persons which directly or
	indirectly through one or more intermediaries are
	Controlled by the foregoing
"Independent Board Committee"	the independent committee of the Board, comprising Mr.
	LUO Tong, Mr. WONG King On, Samuel and Ms.
	HUANG Yi Fei (Vanessa), being the independent non-
	executive Directors, established to advise the
	Independent Shareholders on the Share Purchase
	Agreement, the Framework Technical Services
	Agreement and the connected transactions contemplated
	thereunder
"Independent Financial Advisor"	Platinum Securities Company Limited, a corporation
or "Platinum"	licensed under the Securities and Futures Ordinance to
	provide Type 1 (dealing in securities) and Type 6
	(advising on corporate finance) regulated activities, and
	the independent financial adviser appointed by the
	Company to advise the Independent Board Committee
	and the Independent Shareholders on the Share Purchase
	Agreement, the Framework Technical Services
	Agreement and the connected transactions contemplated
	thereunder
"Independent Shareholders"	the Shareholders, other than (i) Alibaba Holding and its
	associates, including Perfect Advance and the Vendor;
	and (ii) those who are required to abstain from voting at
	the SGM to be convened to approve the Share Purchase
	Agreement, the Framework Technical Services
	Agreement and the connected transactions contemplated
	thereunder
"Initial Deed"	the deed of non-competition entered into between

	Alibaba Holding and the Company on June 30, 2017
"Issue Price"	the per share price of HK$9.38 for the issue of each
	Consideration Share
"Kaola"	the import e-commerce platform known as Kaola (考拉)
	operated by Alibaba Holding's Affiliates
"Koubei"	the restaurant and local services guide platform for in-
	store consumption known as Koubei (口碑) operated by
	Alibaba Holding's Affiliates
"Last Trading Day"	February 6, 2020, being the last full trading day for the
	Shares before the date of this announcement
"Listing Committee"	the listing committee of the Stock Exchange
"Listing Rules"	the Rules Governing the Listing of Securities on the
	Stock Exchange
"Medical and Healthcare	services that have the aim of maintaining and promoting
Services"	human health, primarily including medical services and
	services related to health management and promotion,
	and being services which are primarily sold on the
	primary category "Medical and Health Services" ("醫療
	及健康服務 ") under the business category "Service
	Categories" ("服務大類") on Tmall, but excluding such
	services that do not require industry certification on
	Tmall
"Medical Devices"	instruments, equipment, appliances, materials or other
	items that are used, alone or in combination, on the
	human body, as defined from time to time by the
	Regulations for the Supervision and Administration of
	Medical Devices (《醫療器械監督管理條例》) and
	which are registered (註冊) or filed (備案) or, if sold in
	the PRC, are required to be registered or filed with the
	local departments of the NMPA as a "medical device" ("
	醫療器械") in accordance with the Regulations for the
	Supervision and Administration of Medical Devices (《
	醫療器械監督管理條例》 ) (as such laws and
	regulations may be amended from time to time)
"Medical Purpose Food Products"	formulated food products that are specially processed
	and formulated for the purposes of addressing the special
	nutrient and supplement requirements of people
	suffering from limited food intake, digestion absorption
	difficulties, metabolic disorders or certain other diseases,
	as defined from time to time by the Food Safety Law of
	the PRC (《中華人民共和國食品安全法》) and the
	27

	Rules for the Review of Food Production Licensing for
	Special Medical Purpose Food (《特殊醫學用途配方食
	品生產許可審查細則》) and which are registered or, if
	sold in the PRC, are required to be registered
"Merchant"	a legal entity which conducts the sale of products or
	provision of services on Tmall
"Merchant Assignment"	has the meaning given to it in the sub-section "The Share
	Purchase Agreement - (7) Business Restructuring" in
	this announcement
"Merchant Services"	the services to be provided by the Group to Taobao
	Holding and its Subsidiaries under the 2020 Outsourced
	Services Framework Agreement
"New Deed of Non-competition"	the deed of non-competition to be entered into between
	Alibaba Holding and the Company on or before the
	Completion
"NMPA"	National Medical Products Administration (國家藥品監
	督管理局)
"Non-assigned Target Merchant"	has the meaning given to it in the sub-section "The Share
	Purchase Agreement - (8) Transition Period" in this
	announcement
"Non-competition Period"	the period commencing on Completion and ending on the
	earliest of: (i) the Shares ceasing to be listed on the Stock
	Exchange; (ii) Alibaba Holding ceasing to beneficially
	own an aggregate of 30% or more of the voting securities
	of the Company; (iii) the Company ceasing to be a
	subsidiary (as defined in the Listing Rules) of Alibaba
	Holding; or (iv) Alibaba Holding no longer being the
	single largest Shareholder (aggregated with the Shares
	beneficially owned by persons acting in concert with
	Alibaba Holding)
"Other Target Products and	the Target Products and Services other than the
Services"	Pharmaceutical Products
"Perfect Advance"	Perfect Advance Holding Limited, a company
	incorporated in the British Virgin Islands and an indirect
	wholly-owned Subsidiary of Alibaba Holding
"Permitted Scope"	(a) the conduct of Restricted Business pursuant to
	any then-effective Existing Target Merchant

Contract until the earlier of: (x) the expiration of such Existing Target Merchant Contract in accordance with its terms; and (y) entering into

		a Tripartite Agreement in respect of such
		Existing Target Merchant Contract among (i) the
		DNC Target Merchant, (ii) the WFOE or the
		HK Subsidiary (as the case may be) and (iii)
		the Tmall Entities or Taobao China (as the case
		may be);
	(b)	the conduct of activities pursuant to the terms of
		the Tripartite Agreements to be entered into
		among (i) the DNC Target Merchant, (ii) the
		WFOE or the HK Subsidiary (as the case may
		be) and (iii) the Tmall Entities or Taobao
		China (as the case may be);
	(c)	the conduct of business activities pursuant to the
		terms of any framework technical services
		agreement entered into between Alibaba
		Holding (or its Affiliates) and the Company (or
		its Affiliates) relating to the DNC Restricted
		Products and DNC Restricted Services,
		including the collection of service fees
		thereunder; and
	(d)	the conduct of any business with the Company's
		prior written consent
"Pharmaceutical Products"	substances that are used for the prevention, treatment or
	diagnosis of human diseases or that purposefully regulate
	people's physiological functions, with the indications for
	specific symptom or functions, usages and dosage, as
	defined by the Drug Administration Law of the PRC (《
	中華人民共和國藥品管理法》 ), and which are
	registered or, if sold in the PRC, are required to be
	registered with the NMPA in accordance with the Drug
	Administration Law of the PRC (《中華人民共和國藥
	品管理法》)
"PRC" or "China"	the People's Republic of China, and for the purpose of
	this announcement, excluding Hong Kong, the Macao
	Special Administrative Region and Taiwan
"Prior Deeds"	the Initial Deed and the Second Deed
"Proposed Acquisition"	the sale and purchase of the entire issued share capital of
	the Target Company as contemplated under the Share
	Purchase Agreement
"Restricted Business"	facilitating sales transactions of:
	(i)	DNC Restricted Products using a business-to-
		consumer (B2C) transaction model in the PRC;
		29

	and
	(ii) DNC Restricted Services on Tmall (including
	through Tmall Supermarket) and Tmall Global
"RMB"	Renminbi, the lawful currency of the PRC
"SAMR"	the State Administration for Market Regulation (國家市
	場監督管理總局)
"Second Deed"	the deed of non-competition entered into between
	Alibaba Holding and the Company on August 2, 2018
"SGM"	the special general meeting of the Company to be
	convened for the Independent Shareholders to consider,
	and vote, on the Share Purchase Agreement, the
	Framework Technical Services Agreement and the
	connected transactions contemplated thereunder
"Share Purchase Agreement"	the share purchase agreement dated February 6, 2020
	entered into between the Company and the Vendor in
	respect of the Proposed Acquisition
"Shareholder(s)"	holder(s) of the Shares
"Shares"	ordinary shares of par value HK$0.01 each in the share
	capital of the Company
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Subsidiary" or "Subsidiaries"	an entity or entities which are Controlled
"Substantial Shareholder"	has the meaning ascribed to it under the Listing Rules
"Taobao China"	Taobao China Holding Limited (淘寶中國控股有限公
	司), a limited liability company incorporated in Hong
	Kong and an indirect wholly-owned Subsidiary of
	Alibaba Holding
"Taobao Holding"	Taobao Holding Limited, a limited liability company
	incorporated in the Cayman Islands and a wholly-owned
	Subsidiary of Alibaba Holding
"Taobao Marketplace"	the online and mobile commerce platform or destination
	known as Taobao (淘寶) operated by Alibaba Holding's
	Affiliates

"Target Blue Cap Health Food"	the Blue Cap Health Food products sold on Tmall, but
	excluding (i) any medicated liquor sold under the
	secondary category "health food alcohol" ("保健食品酒
	") under	the primary	category	"alcohol" (" 酒類 ")
	category on Tmall, (ii) any energy drinks sold under the
	secondary category "drinks" ("飲料") under the primary
	category "coffee/oatmeal/instant drinks" ("咖啡/麥片/
	沖飲") category on Tmall, (iii) any maternity health food
	sold under the secondary category "maternity nutritional
	products"	(" 孕產婦營養品 ") under the primary
	category "maternity wear/maternity products/nutritional
	products" ("孕產裝/孕產婦用品/營養品") category on
	Tmall, and (iv) any infant and toddler health food sold
	under the secondary category "infant and toddler
	nutritional	products" (" 嬰幼兒營養品 ") under the
	primary	category	"milk	powder/supplemental
	food/nutritional products/snacks" ("奶粉/輔食/營養品/
	零食") on Tmall
"Target Business"	the business to be directly or indirectly injected into the
	Company pursuant to the terms of the Share Purchase
	Agreement
"Target Company"	Ali JK ZNS Limited, a company incorporated under the
	laws of British Virgin Islands and a direct wholly-owned
	Subsidiary of the Vendor
"Target Group"	the Target Company and its Subsidiaries
"Target Merchant"	a merchant who has obtained, or proposes to obtain,
	permission from Tmall or Tmall Global to sell Target
	Products and Services on Tmall or Tmall Global (as
	applicable), regardless of whether any actual sales of
	Target Products and Services have been made by such
	merchant on those platforms
"Target Products and Services"	the Tmall Products and Services and the Tmall Global
	Products and Services
"Tmall"	Tmall.com, the third party online and mobile commerce
	platform known as Tmall (天猫) operated by Alibaba
	Holding's Affiliates
"Tmall Entities"	Tmall Technology and Tmall Network and/or their
	applicable Affiliates (as the case may be), collectively
"Tmall Global"	the third party import e-commerce platform known as
	Tmall Global (天猫國際) operated by Alibaba Holding's

	Affiliates
"Tmall Global Products and	the following products and/or services sold on Tmall
Services"	Global:
	•	the Pharmaceutical Products;
	•	the Medical Devices;
	•	the Healthcare Products;
	• the Medical Purpose Food Products; and
	• the Medical and Healthcare Services
"Tmall Global Tripartite	each of the tripartite agreements to be entered into among
Agreements"	(i) each of the Target Merchants, (ii) the HK Subsidiary
	and (iii) Taobao China
"Tmall Network"	Zhejiang Tmall Network Co., Ltd* (浙江天貓網絡有限
	公司), a company incorporated under the laws of the
	PRC and ultimately Controlled by Alibaba Holding
"Tmall Platforms"	the following platforms:
		(a)	Tmall (which for the avoidance of doubt,
			includes the channel Tmall Supermarket); and
		(b)	Tmall Global
"Tmall Products and Services"	the following products and/or services:
	•	the Pharmaceutical Products sold on Tmall
		(including through Tmall Supermarket);
	• the Medical Purpose Food Products sold on Tmall
		(including through Tmall Supermarket); and
	•	the Medical Devices, the Adult Products, the
		Healthcare Products, the Medical Purpose Food
		Products, the Medical and Healthcare Services and
		the Target Blue Cap Health Food sold through
		Tmall Supermarket only
"Tmall Software Service Fees"	the software service fees received by Taobao Holding
	and its Subsidiaries from the Company pursuant to the
	Framework Technical Services Agreement
"Tmall Supermarket"	the e-commerce retail channel known as Tmall
	Supermarket (天猫超市) operated by Alibaba Holding's
	Affiliates and featured on Tmall
"Tmall Technology"	Zhejiang Tmall Technology Co., Ltd* (浙江天貓技術有
	限公司), a company incorporated under the laws of the

PRC and an indirect wholly-owned Subsidiary of

Alibaba Holding

"Tmall Tripartite Agreements"	each of the tripartite agreements to be entered into among
	(i) each of the Target Merchants, (ii) the WFOE and (iii)
	the Tmall Entities
"Transition Period"	the period commencing on the date of Completion and
	ending on the earliest of (i) completion of the Merchant
	Assignment of the Non-assigned Target Merchant; and
	(ii) the termination or expiration of the Existing
	Target Merchant Contract
"Tripartite Agreements"	the Tmall Tripartite Agreements and the Tmall Global
	Tripartite Agreements
"Vendor"	Ali JK Nutritional Products Holding Limited, a company
	incorporated under the laws of British Virgin Islands and
	a direct wholly-owned Subsidiary of Alibaba Holding
"VWAP"	in respect of the Shares, volume-weighted average price,
	being the ratio of the value traded to total volume traded
	over a trading day as quoted on the Stock Exchange
"WFOE"	Hangzhou Defu Health Management Co., Ltd.* (杭州得
	賦健康管理有限公司), a company incorporated under
	the laws of the PRC and a wholly-owned Subsidiary of
	the HK Subsidiary
"%"	per cent

English name for identification purpose only.

By Order of the Board

ALIBABA HEALTH INFORMATION TECHNOLOGY

LIMITED

SHEN Difan

Chief Executive Officer and Executive Director

Hong Kong, February 6, 2020

As at the date of this announcement, the Board comprises eight Directors, of whom (i) two are executive Directors, namely, Mr. SHEN Difan and Mr. WANG Qiang; (ii) three are non-executive Directors, namely Mr. WU Yongming, Mr. WANG Lei and Mr. XU Hong; and (iii) three are independent non-executive Directors, namely Mr. LUO Tong, Mr. WONG King On, Samuel and Ms. HUANG Yi Fei (Vanessa).

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Alibaba Health Information Technology Limited published this content on 07 February 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 06 February 2020 22:07:10 UTC

Delayed Hong Kong S.E. Other stock markets 10:33:22 2024-04-23 pm EDT			5-day change	1st Jan Change
2.74 ^HKD	+1.86%		+3.03%	-35.85%

Apr. 03	Alibaba Health Refutes Rumors of Purchase of Telemedicine Platform HaoDF	MT
Mar. 28	Alibaba Health Information Technology Limited and Alibaba.com Enter Shared Services Agreement	CI

Alibaba Health Refutes Rumors of Purchase of Telemedicine Platform HaoDF	Apr. 03	MT
Alibaba Health Information Technology Limited and Alibaba.com Enter Shared Services Agreement	Mar. 28	CI
Alibaba Health Information Technology Limited Announces 2025-2027 Software Services Framework Agreement	Mar. 28	CI
Alibaba Health Shareholders to Vote March 26 on Contract Renewal with Affiliates	Mar. 07	MT
Alibaba Health to Renew Marketing, Technical Services Deals with Affiliates	Feb. 05	MT
Alibaba Health Acquires Parent's Tmall Healthcare Marketing Services	Jan. 17	MT
China Economic Data Blunts Asian Stock Markets	Jan. 17	MT
Rate Outlook Lifts Asian Stock Markets	Nov. 30	MT
Alibaba Health to Buy Parent's Tmall Healthcare Marketing Services for HK$13.5 Billion; Shares Fall 4%	Nov. 30	MT
Alibaba Health Information Technology Names Chief Executive Officer	Nov. 29	MT
Alibaba Health Posts 82% Jump in Fiscal H1 Profit	Nov. 28	MT
Alibaba Health in $1.73 bln deal for some Alibaba marketing services	Nov. 28	RE
Alibaba Health Information Technology to buy AJK Technology for $1.73 billion	Nov. 28	RE
Alibaba Health Information Technology Limited Announces Executive Changes	Nov. 28	CI
Alibaba Health Information Technology Limited Reports Earnings Results for the Half Year Ended September 30, 2023	Nov. 28	CI
Alibaba Health Information Technology Limited agreed to acquire Hangzhou Jingzhun Health Information Technology Co., Ltd. from Alibaba Group Holding Limited for HKD13.5 billion.	Nov. 27	CI
Alibaba Health Information Technology Limited Appoints Xu Haipeng as Non-Executive Director	23-10-19	CI
Interest Rates, US Jobs Outlook Weigh on Asian Stock Markets	23-10-06	MT
Hong Kong stocks rise ahead of US payrolls data, China market reopen	23-10-06	RE
China Proposes Easing of Cross-Border Data Controls -- Update	23-09-29	DJ
Wall Street Cues, Interest Rates Roil Asian Stock Markets	23-09-29	MT
China Proposes Easing of Cross-Border Data Controls	23-09-29	DJ
Fed Hawkishness Blunts Asian Stock Markets	23-09-21	MT
Alibaba Health Information Technology Limited Announces Executive Changes and Committee Changes	23-08-11	CI
Shanghai Xinsu Medical Technology Co., Ltd. announced that it has received funding from Alibaba Health Information Technology Limited	23-07-30	CI

	1st Jan change	Capi.
ALIBABA HEALTH INFORMATION TECHNOLOGY LIMITED	-35.85%	5.46B
WALGREENS BOOTS ALLIANCE, INC.	-30.89%	15.72B
JD HEALTH INTERNATIONAL INC.	-37.21%	9.56B
MATSUKIYOCOCOKARA & CO.	-10.81%	6.13B
YIFENG PHARMACY CHAIN CO., LTD.	+8.92%	6.02B
NAHDI MEDICAL COMPANY	0.00%	4.85B
CORPORATIVO FRAGUA, S.A.B. DE C.V.	+48.75%	4.24B
CLICKS GROUP LIMITED	-12.02%	3.61B
DASHENLIN PHARMACEUTICAL GROUP CO., LTD.	-19.68%	3.46B
WELCIA HOLDINGS CO., LTD.	-5.58%	3.14B

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