Loto Interactive Limited (SEHK:8198) agreed to acquire the remaining 49% stake in Ganzi Changhe Hydropower Consumption Service Co., Ltd from Shenzhen Chengyou Technology Co., Ltd and Guo Xiaoquan for approximately CNY 88.2 million on January 28, 2021. In a related transaction, 500.com Limited entered into a share subscription agreement with Loto Interactive Limited. Pursuant to the transaction, a refundable first payment of CNY 52.9 million or 60% of the acquisition consideration shall be paid to the sellers in cash within five business days after the acquisition completion.

The remaining balance of CNY 35.3 million or 40% of the acquisition consideration shall be paid to the sellers in cash within five business days following the date on which the industry and commercial registration relating to the transfer of the sale interest from the sellers to the purchaser having been completed. The acquisition consideration will be funded by the net proceeds raised by the company through the subscription. The unaudited net asset value of Ganzi Changhe is approximately CNY 159 million and unaudited net profit after tax is approximately CNY 10.2 million as at December 31, 2020.

The transaction is subject to all necessary approvals required by the relevant governmental, regulatory authorities and other third parties, and it is expected to be completed on July 28, 2021. As of March 26, 2021, the transaction has been unanimously approved by shareholders of Loto Interactive.