Zhejiang KAN Special Paper Industry Co., Ltd agreed to acquire Quzhou Bada Paper Industry Co., Ltd. from Zhejiang Kan Specialities Material Co., Ltd. (SZSE:002012) on September 14, 2022. In a related transaction, Zhejiang KAN Special Paper Industry Co., Ltd agreed to acquire Suichang County Chengping Secondary Power Station Co., Ltd 47.11% stake in Suichang County Chengping Secondary Power Station Co., Ltd and Zhejiang KAN Special Paper Industry Co., Ltd agreed to acquire a 60% stake in Zhejiang KAN New Material Co., Ltd. For the year December 31, 2021, Quzhou Bada Paper Industry Co., Ltd. Net profit is CNY 2.54 million. As of December 23, 2022, The shareholders of Quzhou Bada Paper Industry has made a resolution to approve the transaction on November 23, 2022.

The transaction plan still needs to be reviewed and approved by the shareholders' meeting of Zhejiang Kan Specialities Material. As per the terms of agreement, The initial deposit of CNY 40 million has been paid when the framework agreement is signed. Zhejiang KAN Special Paper Industry shall pay no less than CNY 200 million for the equity transfer within 3 days after this agreement takes effect.

Zhejiang KAN Special Paper Industry shall pay the rest of the equity transfer payment within 2 months from the effective date of this agreement. China Great Wall Securities Co.,Ltd. (SZSE:002939) acted as financial advisor, Beijing DeHeng (Hangzhou) Law Firm acted as legal advisor and v acted as accountant to Zhejiang Kan Specialities Material Co., Ltd. (SZSE:002012).