Zhu Ning, an executive Director, Chairman and Chief Executive officer of China Youzan Limited entered into a scheme of arrangement to acquire an additional 85.1% stake in China Youzan Limited (SEHK:8083) from a group of sellers for HKD 2 billion on February 26, 2021. As a part of consideration, Zhu Ning will acquire 14.7 billion shares at a price of HKD 0.1352 per share in cash. Consideration will be paid by the Offeror to the Scheme Shareholders as soon as possible, but in any event within seven (7) Business Days after the Scheme Effective Date. Post transaction, Zhu Ning will hold 93.45% stake in China Youzan Limited, with 2.1% to be held by Youzan Teamwork Inc. In a related transaction, China Youzan Limited agreed to spin off 51.9% stake in Youzan Technology Inc. on February 26, 2021. Upon the Scheme becoming effective, all Scheme Shares will be cancelled, the issued share capital of China Youzan will be reduced by the cancellation of the Scheme Shares. Immediately after such reduction, China Youzan will issue to the Offeror such number of China Youzan Shares as is equal to the number of Scheme Shares cancelled, such that the issued share capital of China Youzan so reduced will be restored to the amount in issue immediately before the capital reduction. The Offeror intends to finance the entire cash amount required for the Proposal by external debt financing. The listing of China Youzan Shares on GEM of the Stock Exchange will be withdrawn. Transaction is subject to Pre-Conditions to the Scheme including Stock Exchange having granted its in-principle approval for the listing of the Youzan Technology Shares on the Stock Exchange for the Youzan Technology Listing and other conditions. Transaction is subject to approval by a majority in number of Scheme Shareholders representing not less than three-fourths in value of the Scheme Shares held by the Scheme Shareholders present and voting either in person or by proxy at the Court Meeting; recommendation from Independent Board Committee of China Youzan Limited the approval by at least 75% of the shareholders of China Youzan Limited for (i) the reduction of the issued share capital of China Youzan by the cancellation of the Scheme Shares, and (ii) the restoration of the issued share capital of China Youzan to the amount immediately prior to the cancellation of the Scheme Shares by the issuance to the Offeror such number of new China Youzan Shares as is equal to the number of Scheme Shares cancelled, credited as fully paid at par; the sanction of the by the Court, and the Scheme delivery to the Registrar of Companies in Bermuda of a copy of the Court Order for registration; all necessary third party consents in relation to the Proposal which may be required having been obtained or waived and other conditions. An Independent Board Committee formed by Board of China Youzan Limited comprising all independent non-executive Directors Fong Chi Wah, Gu Jiawang, Xu Yanqing and Deng Tao to make a recommendation to the Disinterested Scheme Shareholders as to: (i) whether the terms of the Proposal are, or are not, fair and reasonable; (ii) whether to vote in favour of the resolutions for the approval of each of the Special Deal Arrangements at the First SGM; and (iii) whether to vote in favour of the resolutions for the approval of the Scheme at the Court Meeting and the resolutions necessary to implement the Proposal at the Second SGM. As of May 6, 2021, shareholders of China Youzan Limited approved the transaction. Longstop date of the transaction is November 26, 2021. Messis Capital Limited acted as financial advisor to Zhu Ning. Red Sun Capital Limited acted as financial advisor to the Independent Board Committee of China Youzan Limited.