The board of directors of China Shanshui Cement Group Limited announced that on 31 May 2019, the company and China Conch Venture Holdings Limited entered into a strategic cooperation agreement. According to the Strategic Cooperation Agreement, both parties have initially reached an intention on joint development of the projects of collaborative treatment of industrial solid and hazardous waste by cement kilns in the areas covered by the relevant enterprise production lines of the cement clinker base of the Group and joint construction of upstream and downstream industrial chains. The above cooperation will involve discussion on the use of the Group's cement kiln resources in regions such as Shandong and Northeast China, and leveraging on Conch Venture's advantages in technologies and management of collaborative treatment of solid waste by cement kilns, to develop a strategic cooperation platform for collaborative treatment of solid waste by cement kilns, as well as the integration of quality resources, striving to form a complete industrial chain of solid and hazardous waste.

Both parties to the Strategic Cooperation Agreement have reached an intention on strategic cooperation in respect of collaborative treatment of solid waste by cement kilns, based on their intention to achieving complementary advantages and enhanced operational efficiency from the powerful combination in the field of solid waste treatment. Riding on the strengths, resources and expertise of the Group and Conch Venture in respect of solid waste treatment business in the PRC, the Board expects that the cooperation intention will benefit the consolidation of the Group's market position. The Board is of the view that the entering into of the Strategic Cooperation Agreement presents a valuable opportunity and is in line with the interests of the Company and its shareholders as a whole.