China U-Ton Holdings Limited (SEHK:6168) entered into a memorandum of understanding (MOU) to acquire 51% stake in Beijing Yourui Jiahe Electronic Technology Co., Ltd. from Zhang Zhi, Li Zhanqing and others on July 20, 2017. Under the terms of agreement, the consideration payable for the acquisition is expected to be settled by way of cash and issue of shares. The exact amount of the consideration will be negotiated based on the results of the due diligence investigation to be conducted by China U-Ton on Beijing Yourui Jiahe and will be subject to the terms and conditions of the formal sale and purchase agreement. China U-Ton Holdings Limited signed a share purchase agreement to acquire 51% stake in Beijing Yourui Jiahe Electronic Technology Co., Ltd. from Beijing Xingyun Venture Capital Co., Ltd., CHEN Xiaotong and LI Zhanqing for approximately CNY 320 on October 20, 2017. As per terms of the consideration, CNY 37.5 will be paid in cash in two installments, CNY 10 million will be paid on or before December 31, 2017 and the remaining CNY 27.5 will be paid on or before March 31, 2018. The remaining part of the consideration will be paid by issuing shares to the vendors subject to approval from China U-Ton Holdings Limited's shareholders. Beijing Xingyun Venture Capital Co., Ltd., CHEN Xiaotong and LI Zhanqing will sell 30.6%, 15.3% and 5.10% stake in Beijing Yourui Jiahe Electronic Technology Co., Ltd. respectively. As of June 30, 2017, Beijing Yourui Jiahe Electronic Technology Co., Ltd. had net assets of CNY 34.4 million. Upon acquisition, Beijing Yourui Jiahe Electronic Technology Co., Ltd. will form a new Board of Directors with 5 members. China U-Ton Holdings Limited will appoint 3 of the Board members along with 1 Deputy General Manager and the financial controller. The transaction is subject to certain conditions precedent including satisfaction of the performance guarantee, all necessary consents, documents, approvals and filings (if any) required for the signing and performance of the share purchase agreement, each of the joint venture agreement, the articles of association and the loan agreement(s) in the prescribed form has been duly signed and, subject to the internal decision-making procedures, has been duly approved or filed; all senior management and core staff of Beijing Yourui Jiahe Electronic Technology Co., Ltd. have entered into employment contracts for a term of five years, non-disclosure agreements and non-compete agreements and there being no breach of the share purchase agreement by any of the parties. If the conditions are not fulfilled or waived on or before December 31, 2017 or any other date agreed, China U-Ton Holdings Limited may terminate the share purchase agreement. China U-Ton's Board considers that the terms of MOU are fair and reasonable and that the acquisition is in the interest of China U-Ton. Completion of the transaction will take place after the fulfillment or waiver of the conditions. China U-Ton Holdings Limited (SEHK:6168) completed the acquisition of 51% stake in Beijing Yourui Jiahe Electronic Technology Co., Ltd. from Zhang Zhi, Li Zhanqing and others on February 12, 2018. All the conditions of the transaction got fulfilled. Further Consideration, if payable, in 2018 will be settled by cash or issuance of consideration shares at China U-Ton Holdings Limited's discretion.