Qtone Education Group (Guangdong) Co., Ltd. (SZSE:300359) reached a preliminary agreement to acquire 96% stake in Hangzhou Bajiuling Cultural and Creative Co., Ltd. from a group of sellers for CNY 1.7 billion on March 29, 2019. Under the terms of the transaction, Qtone Education Group (Guangdong) Co., Ltd. will issue 240 million shares as consideration. The remaining 4% of Ba Jiuling's shares are held by Ningbo Yuxin's New Economy Phase II Limited Partnership. For the year ended December 31, 2018, Hangzhou Bajiuling Cultural and Creative Co., Ltd. reported total assets of CNY 506.9 million, net assets of CNY 403.4 million, revenue of CNY 231.6 million, and net profit of CNY 75.4 million.

The transaction is subject to internal decision-making procedures from both parties, approval from state-owned asset supervision and administration, another directorate and shareholders' approval of Qtone Education Group (Guangdong) Co., Ltd., and approval from China Securities Regulatory Commission. On March 29, 2019, the transaction has been approved by the 17th interim session of the 3rd directorate meeting of Qtone Education Group (Guangdong) Co., Ltd. The transaction is not subject to approval from the board of directors of Anhui Xinhua Media Co., Ltd. and from the shareholders' meeting of Anhui Xinhua Media Co., Ltd. The transaction has already been approved by Anhui Xinhua Media's General Manager Office.

Qtone Education Group (Guangdong) Co., Ltd. (SZSE:300359) cancelled the acquisition of 96% stake in Hangzhou Bajiuling Cultural and Creative Co., Ltd. on September 27, 2019. Due to various factors such as the macroeconomic environment, changes in restructuring policies, and price fluctuations in the secondary market of stocks, the parties to the transaction did not reach a final consensus on the core terms of the transaction pricing, performance commitments and compensation arrangements involved in the restructuring plan, therefore the transaction is terminated.