OPTICAL BETA LIMITED made an offer to acquire 45% stake in O-Net Technologies (Group) Limited (SEHK:877) from disinterested Shareholders for HKD 2.43 billion on July 8, 2020. The offer price is HKD 6.5 per share. Under the terms of transaction Offeror is acquiring 375.19 million shares, representing 44.99% stake. As on July 14, the terms were revised and the Offeror will acquire 372.4 million shares representing 44.65% stake for HKD 2.42 billion. As on the July 8, 2020, Kaifa, Na and Na Related Shareholders held 55.01% stake in O-Net Technologies. Post acquisition the offeror will hold 100% stake in O-Net Technologies. Optical Alpha and Kaifa holds 82.21% and 17.79% stake respectively in OPTICAL BETA LIMITED. In a related transaction the Offeror, Optical Alpha, Na, the Na Related Shareholders, the Equity Investor, the Subscription Investor and Kaifa entered into the Consortium Agreement and formed the Offeror Consortium for the purpose of the Proposal on July 7, 2020. The Offeror intends to finance the cash requirement for the Proposal through a (a)drawdown of debt facilities with an aggregate amount of HKD 1.44 billion provided by CMB the Offeror’s repayment obligation under which is guaranteed by Na and to be secured by, among others, account charges, share charges and equity charges over relevant subsidiaries and assets of the Company after the completion of the Proposal and (b) a shareholder contribution from Optical Alpha to the Offeror funded by (i) a drawdown of debt facilities with an aggregate amount of HKD 730 million provided by CMB to Optical Alpha Optical Alpha’s repayment obligation under which is guaranteed by Na and secured by among others, equitable mortgages over all Optical Alpha Shares and over Optical Alpha’s entire shareholding interest in the Offeror and (ii) an aggregate cash investment of HKD 738,775,102, being the subscription price payable by the Equity Investor under the Offshore Subscription Agreement, payable by the Equity Investor no later than the Business Day immediately following the date on which the Scheme is sanctioned by the Grand Court of the Cayman Islands or any such other date as agreed between the Equity Investor and the Offeror. As at the Announcement Date, a sum approximately HKD730 million has been deposited into the designated bank account pursuant to the Subscription Investor’s Irrevocable Undertakings and the terms of the Onshore Subscription Agreement for the purpose of satisfying one of the conditions precedent for the drawdowns of the Offeror Acquisition Financing and the Optical Alpha Acquisition Financing and the entire share capital of the Subscription Investor has been pledged to the designated bank If the Proposal is approved and implemented then (a) the Scheme Shares held by the Disinterested Shareholders will be cancelled and extinguished on the Effective Date in exchange for the payment of the Cancellation Price of HKD 6.50 in cash for each Scheme Share (b) the 287 million Scheme Shares held by the Na Related Shareholders will be cancelled and extinguished on the Effective Date in exchange for the Na Related Shareholders Cancellation Consideration, which consists of the crediting of 287 million unpaid Offeror Shares, representing 46.05% of the Offeror Shares in issue out of the 513 million unpaid Offeror Shares, representing 82.21% of the Offeror Shares in issue held by Optical Alpha as fully paid at the Cancellation Price per Offeror Share and in turn, the crediting of the unpaid Optical Alpha Shares held by the Mr. Na Related Shareholders as fully paid at the Cancellation Price per Optical Alpha Share (c) the 171 million Scheme Shares held by Kaifa will be cancelled and extinguished on the Effective Date in exchange for the Kaifa Cancellation Consideration, pursuant to which (i) 60 million Scheme Shares out of the 171 million Scheme Shares held by Kaifa will be cancelled and extinguished in consideration for cash at the Cancellation Price and (ii) 111 million Scheme Shares out of the 171 million Scheme Shares held by Kaifa will be cancelled and extinguished in consideration for the crediting of the unpaid Offeror Shares held by Kaifa in the offeror, representing 17.79% of the Offeror Shares in issue as fully paid at the Cancellation Price per Offeror Share (d) the issued share capital of the Company will be reduced by cancelling and extinguishing the Scheme Shares, and upon such reduction, the issued share capital of the Company will be increased to its former amount by the issuance at par to the Offeror, credited as fully paid, of the aggregate number of Shares as is equal to the number of Scheme Shares cancelled and extinguished on the Effective Date (e) the listing of the Shares on the Stock Exchange will be withdrawn with effect after the Effective Date. The transaction is subject to (a) the approval of the Scheme by way of poll by a majority in number of the Disinterested Shareholders representing not less than 75% in value of the Shares held by the Disinterested Shareholders (b) the passing of a special resolution by a majority of not less than three-fourths of the votes cast by the Shareholders present and voting in person or by proxy at the EGM to approve and give effect to the reduction of the number of issued Shares in the share capital of the Company by cancelling and extinguishing the Scheme Shares. (c) the passing of an ordinary resolution by a simple majority of the votes cast by the Shareholders present and voting in person or by proxy at the EGM to immediately thereafter increase the issued Shares to the amount prior to the cancellation and extinguishment of the Scheme Shares and apply the reserve created as a result of the cancellation and extinguishment of the Scheme Shares to pay up in full at par such number of new Shares as is equal to the number of Scheme Shares cancelled and extinguished as a result of the Scheme, credited as fully paid, for issuance to the Offeror (d) the Grand Court’s sanction of the Scheme and, to the extent necessary, its confirmation of the reduction of the number of issued Shares in the share capital of the Company, and the delivery to the Registrar of Companies in the Cayman Islands of a copy of the order of the Grand Court for registration (e) compliance, to the extent necessary, with the procedural requirements and conditions, if any, under Sections 15 and 16 of the Companies Law in relation to the reduction of the number of issued Shares in the share capital of the Company (f) approval of the Consortium Agreement and transactions contemplated thereunder by shareholders of Shenzhen Kaifa, the holding company of Kaifa, in accordance with the Rules Governing the Listing of Securities on the Shenzhen Stock Exchange having been obtained (g) all necessary Authorizations which are material in the context of the Group taken as a whole and other registrations, filings, rulings, consents, opinions, permissions and approvals in connection with the Proposal having been obtained from, given by or made with the Relevant Authorities, in the Cayman Islands, Hong Kong and any other relevant jurisdictions (h) all necessary consents which may be required for the implementation of the Proposal and the Scheme under any existing contractual obligations of the Company being obtained or waived by the relevant party where any failure to obtain such consent or waiver would have a material adverse effect on the business of the Group. As on July 24, 2020, The Consortium Agreement and transactions contemplated were approved at the shareholders meeting of Shenzhen Kaifa. Accordingly, the said condition has been fulfilled. As of July 27, 2020, the date of dispatch of scheme document extended from July 29, 2020 to September 7, 2020. The court meeting postponed to September 25, 2020 and scheme document on September 2, 2020. China International Capital Corporation Hong Kong Securities Limited acted as the financial adviser to the OPTICAL BETA LIMITED.