Eight Enterprises Acquired Half of Zhongce Rubber’s Equity

On May 29, several “Prompt Announcements on Planning for Major Events” were released. Eight enterprises from Hangzhou and Shanghai will jointly contribute to purchase shares from shareholders of Zhongce Rubber Group Co., Ltd. The total transaction equity accounts for 57.1136%, more than half.

In this acquisition, Red Avenue New Materials Group Co., Ltd. will use its holding subsidiary to purchase 10.1647% of Zhongce Rubber’s equity in cash. Upon completion of the transaction, Red Avenue New Materials will indirectly hold 8.9195% of the latter’s equity. The subsidiary that directly purchases the equity is named Shanghai Tongzhong Enterprise Management Co., Ltd., and the total amount of funds required for the acquisition is RMB 1,255 Million Yuan. Red Avenue New Materials will jointly increase the capital of the subsidiary company with affiliated company Hangzhou Ningce in advance.

The other 46.9489% of Zhongce Rubber’s equity will be acquired by a company named Hangzhou Zhongce Haichao Enterprise Management Co., Ltd., with a total transaction amount of RMB 5,798 Million Yuan. Zhongce Haichao is a new company established by four local Hangzhou enterprises in Hanghzou especially for this transaction. The four enterprises respectively are Hangzhou Great Star Industrial Co., Ltd., Hangcha Group Co., Ltd., Juxing United Holding Group Co., Ltd., and Hangzhou Haichao Enterprise Management Partnership (Limited Partnership). The former two are domestic listed companies.