Shandong Gold Mining Co., Ltd. (SHSE:600547) made a proposal to acquire Hengxing Gold Holding Company Limited (SEHK:2303) from Gold Virtue Limited, Xi Wang and other shareholders for HKD 3 billion on September 29, 2020. Under the terms, Shandong Gold will issue 5/29 shares for each shares of Hengxing Gold and will take Hengxing Gold private by scheme of arrangement. Gold Virtue Limited will sell 60% stake, Xi Wang will sell 15% stake and other shareholders will sell 25% stake. Post- transaction, Hengxing Gold will apply for withdrawal of the listing of the HXG Shares on the stock exchange.

The transaction is subject to approval from shareholders of Hengxing Gold (not less than 75%), court approval, approval from shareholders of Shandong Gold in a fifth extraordinary general meeting scheduled on November 13, 2020, all necessary approval from State Administration for Market Regulation and China Securities Regulatory Commission, National Development and Reform Commission of the People's Republic of China, Ministry of Commerce of the People's Republic of China or the Department of Commerce of Shandong Provincial Government, listing committee of the Stock Exchange having granted the listing of the H Shares to be issued pursuant to the agreement and third party consent. Shandong Gold has received irrevocable undertaking from the Gold Virtue and Xi Wang which, hold 75% stake to vote in favor of scheme. On September 30, 2020, the Board of Directors of Shandong Gold Mining Co., Ltd. approved the transaction in 43rd session of the 5th directorate meeting. On October 28, 2020, the Board of Directors of Shandong Gold Mining Co., Ltd. are of the view that the proposed resolutions at the fifth extraordinary general meeting and the H Shares Class meeting are fair and reasonable and in the best interests of Shandong Gold Mining Co., Ltd. and its shareholders as a whole and its recommend to the shareholders to vote in favor of the relevant resolution. As of November 13, 2020, the transaction was approved by shareholder of Shandong Gold Mining. As on November 13, 2020, State Administration for Market Regulation (“SAMR) approval. As on November 18, 2020, apart from SAMR Approval, none of the Pre-Conditions and the other Conditions has been fulfilled or waived. Independent Board Committee includes Albert Fook Lau HO, WONG, Yan Ki Angel, Tim SUN and PAN Guocheng. The Board of Hengxing Gold recommended its shareholders to vote for the transaction. As of January 14, 2021, China Securities Regulatory Commission approved the deal. The meeting of the shareholders of Hengxing Gold is scheduled to be held on January 13, 2021. The transaction has been approved in a court meeting held on January 27, 2021. All the conditions of the transaction has been fulfilled on January 28, 2021. The transaction is expected to complete on January 28, 2021.

China International Capital Corporation Hong Kong Securities Limited is acting as financial advisor and Tricor Investor Services Limited acted as the registrar for Shandong Gold Mining Co., Ltd. Standard Chartered Bank (Hong Kong) Limited is acting as financial advisor for Hengxing Gold and Octal Capital Limited is acting as financial advisor for Independent board committee of Hengxing Gold. Joey Chau of Kirkland & Ellis acted as financial advisor to China International Capital Corporation Hong Kong Securities Limited in the transaction.