Taiyuan Lionhead Cement Co.,Ltd. (SHSE:600539) intends to acquire an additional 59.99% majority stake in Hangzhou Quentin Science and Technology Co.,Ltd from a group of shareholders for approximately CNY 320 million on June 21, 2021. Under the transaction, Taiyuan Lionhead Cement Co.,Ltd. will acquire 7.658574 million shares of Hangzhou Quentin Science and Technology Co.,Ltd for a consideration to be paid by issuing shares and cash in the ratio of 65% and 35% respectively. Issued shares will have a lock up period of 12 months since issuance date.

Taiyuan Lionhead Cement Co.,Ltd. will acquire 36.38% stake from Fang Hebing, 5.27% stake from Liu Jiadong, 5.27% stake from Fang Linbin, 4.64% stake from Hangzhou Kunyang Investment Management Partnership Enterprise (Limited Partnership), 4% stake from He Rong, 2.73% stake from Zhang Yuanfan and 1.7% stake from Bai Zhiyong. Taiyuan Lionhead Cement Co.,Ltd. intends to raise supporting funds from no more than 35 investors through non-public issuance of stocks, which will be subject to approval from the China Securities Regulatory Commission and other conditions. After the transaction, Hangzhou Quentin Science and Technology Co.,Ltd will become a 99.99% subsidiary of Taiyuan Lionhead Cement Co.,Ltd. Transaction is subject to approval from shareholders of Taiyuan Lionhead Cement Co.,Ltd., approval of the China Securities Regulatory Commission, Hangzhou Quentin Science and Technology Co.,Ltd completed the relevant procedures for delisting from the stock transfer system and changing to a limited liability company and other possible approvals or approvals required by relevant laws and regulations (if necessary).

Transaction is approved by board of directors of Taiyuan Lionhead Cement Co.,Ltd. Transaction is unanimously approved by all partners of Hangzhou Kunyang Investment Management Partnership Enterprise (Limited Partnership). As of August 6, 2021, According to the "Supplementary Transaction Memorandum", the total transaction value of the underlying shares is tentatively set at CNY 318 million. The final transaction price is based on the asset evaluation report issued by an evaluation agency qualified for securities and futures business.

The value is the basis and is determined by the parties to the transaction through negotiation. The price of the shares issued this time shall not be lower than 90% of the average stock trading price of the 120 trading days before the pricing base date, which is CNY 6.87 per share.