Dalian Port (PDA) Company Limited (SEHK:2880) signed a letter of intent to acquire Yingkou Port Liability Co.,Ltd (SHSE:600317) from Yingkou Port Group CORP., China Securities Finance Corporation Limited and others on June 19, 2020. Dalian Port (PDA) Company Limited entered into a merger agreement to acquire Yingkou Port Liability Co.,Ltd from Yingkou Port Group CORP., China Securities Finance Corporation Limited and others for CNY 6 billion on July 7, 2020. Under the terms of the transaction, Dalian will acquire 6.47 billion A shares of Yingkou. For one share of Yingkou, 1.5146 shares of Dalian will be issued. The exchange ratio is subject to adjustment as per the dividend announcement made by Dalian on June 22, 2020. Subject to the merger becoming unconditional, the dissenting shareholders of Yingkou may elect to exercise the cash alternative to receive cash at the rate of CNY 2.16 per share. After the completion of the dividend distribution plan, the cash alternative shall be exercised at the rate of CNY 2.11 per share dissenting shareholders of Dalian may elect to exercise the Buy-back Alternative to receive cash at the rates of CNY 1.71 per A share and CNY 0.606323 per H Share. After the completion of the aforementioned dividend distribution plan, the buy-back alternative shall be exercised at the rate of CNY 1.69 per A Share and CNY 0.588224 per H Share. As of August 27, 2020, the share exchange ratio was adjusted to 1.503. The share swap ratio was adjusted according to the 2019 profit distribution plans of Dalian Port (PDA) and Yingkou Port Liability. Upon completion of the merger, Yingkou will cease to be listed or registered, and Dalian will assume all the assets, liabilities, businesses, personnel, contracts and all other rights and obligations of Yingkou. The A Shares issued by the Dalian will apply to be listed and traded on the main board of the Shanghai Stock Exchange. The agreement can be terminated if both parties agree to terminate. Dalian also plans to raise funds by issuing A Shares with a value of not more than CNY 2.1 billion, by way of non-public offering, to not more than 35 specific investors. Dalian Port (PDA) Company Limited will change its name to Liaoning Port Co., Ltd. to better reflect its business strategy after acquisition of Yingkou Port Liability Co., Ltd. On January 28, 2021, Dalian Port (PDA) Company Limited changed its name to Liaoning Port Co., Ltd.

The transaction is subject to Board of Directors' approval and shareholders' approval of Dalian and relevant shareholders' approvals for the possible merger will be for a period of 12-month from such approvals at the general meeting and class meetings of Dailan. Transaction is also subject to approval from Board of Directors and shareholders of Yingkou. Transaction is also subject to consents and approval from State-owned Assets Supervision and Administration Commission of the State Council and China Securities Regulatory Commission. Transaction is also subject to the Shanghai Stock Exchange having no objection to the announcements and circulars issued by Dalian related to the merger. The transaction is also subject to competent authorities. As on July 7, 2020, State-owned Assets Supervision and Administration Commission of the State Council agreed in principle to the overall plan of the merger. As on July 7, 2020, Directors of Dalian are of the view that terms are fair and reasonable and in the interests of Dalian and its shareholders as a whole. The deal has been approved by the 2nd session of Dalian Port (PDA) Company Limited's 6th directorate for 2020 and by the 5th session of Yingkou Port Liability Co., Ltd.'s 7th directorate. As of September 25, 2020, the H shareholders of Dalian Port (PDA) Company has approved the transaction and the raising of supporting funds transaction. As on October 12, 2020, The Dalian Port (PDA) Company Limited recently received the China Securities Regulatory Commission Administrative License Application Acceptance Form issued by the China Securities Regulatory Commission and still needs to be approved by the China Securities Regulatory Commission. As of December 7, 2020, transaction has been unconditionally approved by the Merger and Reorganization Audit Committee of Listed Companies of the China Securities Regulatory Commission. As of January 29, 2021, as approved by Shanghai Stock Exchange, Yingkou Port Liability Co.,Ltd will delist from the Shanghai Stock Exchange from January 29, 2021. As of February 4, 2021 the transaction has been approved by China Securities Regulatory Commission. The share registration date for the merger implementation of this merger is January 28, 2021. Dalian will form an Independent committee comprising the independent non-executive Directors. Committee will be formed to advise the shareholders on the terms of the merger agreement. An independent financial adviser will be appointed to advise the Independent Board Committee and the independent shareholders of Dalian Port (PDA) Company on the same.

China International Capital Corporation Limited (SEHK:3908) and China Merchants Securities Co., Ltd. (SHSE:600999) acted as financial advisors to Dalian and CITIC Securities Company Limited (SHSE:600030) acted as financial advisor to Yingkou. Tang Yiyun, Gong Mulong, Xie Yuanxun, Tao Tao and Chai Zhifeng Kind & Wood Mallesons acted as legal advisor and Ernst & Young Certified Public Accountants acted as an accountant for Dalian Port (PDA) Company Limited (SEHK:2880). Zhong Lun Law Firm acted as legal advisor and ShineWing Certified Public Accountants Co., Ltd. acted as accountant for Yingkou Port Liability Co.,Ltd. First Shanghai Capital Limited acted as the independent financial advisor to independent board committee of Dalian. Samuel Ng of Paul Hastings LLP acted as legal advisor to Dalian Port (PDA) Company.

Dalian Port (PDA) Company Limited (SEHK:2880) completed the acquisition of Yingkou Port Liability Co.,Ltd from Yingkou Port Group CORP., China Securities Finance Corporation Limited and others on February 9, 2021.