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1 ASX / MEDIA RELEASE 24 July 2017 INCOMPLETE, NON-BINDING AND INDICATIVE PROPOSAL RECEIVED Tian An Australia Limited (ASX:TIA) (TIA r Cmpany) has received an incmplete, nn-binding and indicative prpsal in respect f a prprtinal ff-market takever frm Oasis Star Limited (Oasis Star) t acquire 80% f each sharehlder s issued shares in TIA that it des nt wn at an ffer price f A$1.30 per TIA share (Indicative Prpsal). The Indicative Prpsal is utlined in the enclsed letter received frm Oasis Star. Abut Oasis Star Oasis Star currently has a relevant interest in 34.46% f the entire issued share capital f TIA. Oasis Star is a 100% indirectly held subsidiary f Tian An China Investments Cmpany Limited (TACI), a cmpany incrprated under the laws f Hng Kng and listed n the main bard f The Stck Exchange f Hng Kng Limited. TACI is a majr real estate and investment cmpany cncentrating n large-scale develpments with a fcus n the main cities f Nrthern, Eastern and Suthern China. TACI is engaged principally in the develpment f apartments, villas, ffice buildings and cmmercial prperties as well as prperty investment and prperty management. Cautin t sharehlders There is n certainty that the Indicative Prpsal will result in an ffer fr TIA shares. Any ffer fr TIA shares will be the subject f a bidder statement issued by Oasis Star. If a bidder statement is issued, TIA will issue a target statement utlining TIA s recmmendatin t TIA sharehlders. Accrdingly, TIA sharehlders are advised t exercise cautin in dealing with their TIA shares and nt t make any decisin befre a frmal ffer is made fr their shares and they have received TIA s frmal recmmendatin. TIA sharehlders are further advised t cnsult their apprpriate legal and prfessinal advisrs if they are in any dubt abut hw t deal with their TIA shares. Next steps TIA has established an independent bard cmmittee cmprised f independent directrs f TIA, being Marcus Sew and Cerena Fu (Independent Bard Cmmittee) t review and assess the Indicative Prpsal. If an ffer is made by Oasis Star in accrdance with the Indicative Prpsal, a sharehlder s meeting will be cnvened and held in due curse t apprve the prprtinal takever pursuant t sectin 648E f the Crpratins Act 2001 (Cth) and therwise pass the sharehlder reslutins necessary t give effect t the transactin the subject f the Indicative Prpsal. TIA will cntinue t infrm the market n any further develpments in accrdance with its cntinuus disclsure bligatins. The Bard has appinted Piper Alderman as legal advisers in cnnectin with the Indicative Prpsal. Tian An Australia Limited ABN Level 5, 99 Macquarie Street, Sydney NSW 2000 T F

2 END Investr Cntact: Hai-Yung Lu, Cmpany Secretary & Legal Cunsel T E hlu@tianan.cm.au Abut Tian An Australia: The principal activity f Tian An Australia is t identify urban prjects t develp fr resale. By nature, these master planned prjects ffer many built-frm value add pprtunities beynd the standard residential lt market. Tian An Australia has a visin t grw as a significant cntributr t the design and develpment f premium residential prperty utilising cmmunity based planning and innvative design cncepts targeted t meet the needs and exceed the expectatins f markets while delivering new benchmarks in envirnmental excellence. Page 2 f 3

3 APPENDIX INCOMPLETE, NON-BINDING AND INDICATIVE PROPOSAL RECEIVED Page 3 f 3

4 24 July 2017 The Directrs Tian An Australia Limited Level 5 99 Macquarie Street Sydney NSW 2000 Australia Attentin: Hai-Yung Lu, Cmpany Secretary & Legal Cunsel Dear Directrs Intentin t make a prprtinal takever ffer fr Tian An Australia Limited This letter cnstitutes ntice that Tian An China Investments Cmpany Limited, a cmpany incrprated under the laws f Hng Kng and having its registered ffice at 22nd Flr, Allied Kajima Building, 138 Glucester Rad, Wanchai, Hng Kng (TACI), thrugh its whlly wned subsidiary Oasis Star Limited, a cmpany incrprated under the laws f British Virgin Islands (Oasis Star), intends t make an ff-market prprtinal takever ffer fr 80% f each ther sharehlder's issued shares in Tian An Australia Limited (TIA) (Offer). The key terms f the takever ffer will be as fllws. 1. Offer price The Offer will be an all-cash ff-market prprtinal takever bid at A$1.30 per share. We believe this will be a very attractive prpsitin fr TIA sharehlders. Fr example: The Offer represents a substantial premium t TIA's histrical trading price range, being: a 47.73% premium t TIA's clsing price f A$0.88 n 21 July 2017; and a 48.22% premium t TIA's six mnth vlume weighted average share price t 21 July Trading vlumes in TIA shares are lw. As a result, the Offer prvides a liquidity pprtunity fr sharehlders. 2. Offer cnditins The Offer will be cnditinal n the cnditins set ut in Annexure A TACI has already received cnfirmatin frm the Freign Investment Review Bard pursuant t the Freign Acquisitins and Takevers Act 1975 (Cth) that the Cmmnwealth has n bjectin t the Offer prceeding. 3. Offer funding Oasis Star will fund the acquisitin frm cash n hand and credit facilities available t it thrugh TACI. 4. Abut Oasis Star and TACI Oasis Star is a 100% indirectly held subsidiary ft ACI _6

5 TACI is a cmpany listed n the main bard f The Stck Exchange f Hng Kng Limited and is a majr real estate and investment cmpany cncentrating n large-scale develpments with a fcus n the main cities f Nrthern, Eastern and Suthern China. T ACI is engaged principally in the develpment f apartments, villas, ffice buildings and cmmercial prperties as well as prperty investment and prperty management. 5. Intentins Oasis Star is supprtive f the bard f directrs and management team f TIA and their current strategy and has n current intentin t make any substantive changes t the peratins f TIA. Oasis Star will be supprtive f TIA increasing its peratins and f hiring sufficient prperly qualified staff in supprt such increases. On r abut the date f this letter, Tian An Asset Investments Cmpany Limited (TAAI), which is a whlly wned subsidiary ft ACI and wns the entire share capital f Oasis Star, has entered int a memrandum f understanding with Xiangyu Real Estate Grup Cmpany Ltd (Xiangyu) (MOU). The MOU requires T AAI and Xiangyu t enter int a frmal agreement pursuant t which Xiangyu, r its direct r indirect whlly-wned subsidiary, wuld, fllwing cmpletin f the Offer, acquire 50% f the issued shares in Oasis Star, subject t varius cnditins including regulatry apprvals, the apprval f the bard f directrs f each f T AAI and Xiangyu and t Xiangyu cnducting due diligence the results f which it cnsiders t be satisfactry. Any such transactin wuld als be cnditinal n the apprval f TIA's sharehlders pursuant t item 7 f sectin 611 Crpratins Act 2001 (Cth) (Crpratins Act). The cnsideratin payable by Xiangyu (Xiangyu Cnsideratin) wuld be the aggregate f: 50% f the value f all issued shares in TIA held by Oasis Star fllwing cmpletin f the Offer (n the basis that the value f each TIA share wuld be taken t be A$1.30, being the Offer price) but subject t the maximum f the audited net asset value per share in TIA as at the reference date; and an interest charge f 6% per annum accrued n 50% f the ttal amunt expended by TIA and/r Oasis Star in cmpleting the Offer during the perid cmmencing frm the full payment f the cnsideratin by Oasis Star under the Offer until the date f payment f the Xiangyu Cnsideratin by Xiangyu r its direct/indirect whlly-wned subsidiary t TAAI. In additin, Xiangyu r its direct/indirect whlly-wned subsidiary will reimburse TAAI fr its prprtinate csts in cnducting and cmpleting the Offer and assciated csts, Infrmatin abut Xiangyu is included belw. 6. Abut Xiangyu Xiangyu is the real estate arm and a whlly-wned subsidiary under Xiamen Xiangyu Grup Crpratin (Xiangyu Grup) and has peratins in Shanghai, Jiangsu, Fujian, Chngqing, Hunan and ther areas in China. Funded n 28 Nvember 1995, Xiangyu Grup is a whlly state-wned enterprise with its headquarters in Xiamen, China. It has ver 200 investment cmpanies. 160 whlly-wned cmpanies and investment hlding cmpanies as well as 7,000 emplyees. Xiangyu Grup engages in industrial and residential real estate, trading, lgistics and financial services and investment _6 2

6 7. Indicative timetable Oasis Star will ldge its bidder's statement as sn as pssible but in any event within the prescribed tw mnth perid required by sectin 631 (1 )(b) f the Crpratins Act. At that time, Oasis Star als intends t seek TIA's agreement pursuant t item 6 f sectin 633( 1) f the Crpratins Act t an early dispatch f the bidder's statement fr the purpse f expediting the Offer prcess. We lk frward t wrking tgether t cnduct the Offer in a friendly and timely manner. Yurs faithfully Ta Tsan Sang Directr Oasis Star Limited _6 3

7 Annexure A- Cnditins f Offer Defined terms In this Annexure, the fllwing defined terms apply. Annuncement Date means the date the Offer is annunced by TIA. Assciate has the meaning given in sectin 12(2) f the Crpratins Act. Business Day means a day n which banks are pen fr business in Sydney, excluding a Saturday, Sunday r public hliday in Sydney, and the ASX is pen fr trading. Crpratins Act means the Crpratins Act 2001 (Cth). Encumbrance means an interest r pwer: (a) (b) reserved in r ver an interest in any asset, including any retentin f title; r created r therwise arising in r ver any interest in any asset under a bill f sale, mrtgage, charge, lien, pledge, trust r pwer, by way f security fr the payment f a debt, any ther mnetary bligatin r the perfrmance f any ther bligatin, and includes, any agreement t grant r create any f the abve and als includes a "security interest" within the meaning f sectin 12 f the Persnal Prperty Securities Act 2009 (Cth). Offer means the ffer defined n the first page f this letter. Offer Perid means the perid during wh ich the Offer will remain pen fr acceptance in accrdance with the bidder's statement that will be prvided by Oasis Star. Public Authrity means any gvernment r any gvernmental, semi-gvernmental, statutry r judicial entity, agency r authrity, whether in Australia, r elsewhere, including any self-regulatry rganisatin established under statue r therwise discharging substantially public r regu latry functins, and the ASX r any ther stck exchange. Share means a fully paid rdinary share in the capital f TIA. Subsidiary has the meaning given in sectin 9 f the Crpratins Act. TIA Grup means TIA and each f its Subsidiaries. Cnditins 1. Minimum acceptance Oasis Star receiving sufficient acceptances s that, fllwing cmpletin f the Offer, it will wn at least 50.1 (by number) f TIA shares n issue at the end f the Offer Perid. 2. Sharehlder apprval under article 14.6 f cnstitutin fr prprtinal takever bid TIA btaining sharehlder apprval pursuant t article 14.6 f TIA's cnstitutin. 3. N regulatry actin Between the Annuncement Date and the end f the Offer Perid (each inclusive) : _6 4

8 there is nt in effect any preliminary r final decisin, rder r decree issued by any Public Authrity; n actin r investigatin is annunced, cmmenced r threatened by any Public Authrity; and n applicatin is made t any Public Authrity (ther than by Oasis Star r any Assciate f Oasis Star), in cnsequence f r in cnnectin with the Offer (ther. than an applicatin t, r a decisin r rder f, ASIC r the Takevers Panel in exercise f the pwers and discretins cnferred by the Crpratins Act) which restrains, prhibits r impedes, r threatens t restrain, prhibit r impede, r materially impact upn, the making f the Offer and the cmpletin f the Offer r which requires the divestiture by Oasis Star f any Shares r any material assets f TIA r any Subsidiary f TIA. 4. N material adverse change Between the Annuncement Date and the end f the Offer Perid (each inclusive), nne f the fllwing ccurs (Specified Event): an event, change, cnditin, matter r thing ccurs; infrmatin is disclsed r annunced by TIA r any f its subsidiaries cncerning any event, change, cnditin, matter r thing; r infrmatin cncerning any event, change, cnditin, matter r thing becmes knwn t Oasis Star (whether r nt becming public), which will have, culd reasnably be expected t have r which evidences that there has been a material adverse effect n the business, assets, liabilities, financial psitin and perfrmance, material cntracts (taken as a whle), prfitability r prspects f TIA r any f its Subsidiaries frm that existing prir t the Annuncement Date. 5. N prescribed ccurrences Between the Annuncement Date and the date 3 Business Days after the end f the Offer Perid (each inclusive), nne f the fllwing prescribed ccurrences happen: TIA cnverts all r any f its Shares int a larger r smaller number f Shares; TIA r a Subsidiary f TIA (which is nt a directly r indirectly whlly wned Subsidiary) reslves t reduce its share capital in any way; TIA r a Subsidiary f TIA (which is nt a directly r indirectly whlly wned Subsidiary): enters int a buy-back agreement; r reslves t apprve the terms f a buy-back agreement under sectin 257C(1) r 257D( 1) f the Crpratins Act; TIA r a Subsidiary f TIA issues shares r grants an ptin ver its shares, r agrees t make such an issue r grant such an ptin; TIA r a Subsidiary f TIA issues, r agrees t issue, cnvertible ntes; _6 5

9 TIA r a Subsidiary f TIA dispses, r agrees t dispse, f the whle, r a substantial part, f its business r prperty; TIA r a Subsidiary f TIA charges, r agrees t charge, the whle, r a substantial part, f its business r prperty; TIA r a Subsidiary f TIA reslves t be wund up; the appintment f a liquidatr r prvisinal liquidatr f TIA r a Subsidiary f TIA; a curt makes an rder fr the winding up f TIA r a Subsidiary f TIA; an administratr f TIA, r a Subsidiary f TIA, is appinted under sectin 436A, 436B r 436C f the Crpratins Act; TIA r a Subsidiary f TIA executes a deed f cmpany arrangement; r a receiver, r a receiver and manager, is appinted in relatin t the whle, r a substantial part, f the prperty f TIA r a Subsidiary f TIA. 6. N persns entitled t exercise r exercising rights under certain agreements r instruments Between the Annuncement Date and the end f the Offer Perid (each inclusive), there is n persn, excluding any Assciate f TACI, entitled t exercise, exercising r purprting t exercise, stating an intentin t exercise (whether r nt that intentin is stated t be a final r determined decisin f that persn), r asserting a right t exercise, any rights under any prvisin f any agreement r ther instrument t which TIA r any f its Subsidiaries is a party, r by r t which TIA r any f its Subsidiaries r any f its assets r businesses may be bund r be subject, which results, r culd result, t an extent which is material in the cntext f TIA and its Subsidiaries taken as a whle, in: any mneys brrwed by TIA r any f its Subsidiaries being r becming repayable r being capable f being declared repayable immediately r earlier than the repayment date stated in such agreement r ther instrument; any such agreement r ther such instrument being terminated r mdified r any actin being taken r arising there under (including the acceleratin f the perfrmance f any bligatins there under) ; the interest f TIA r any f its Subsidiaries in any firm, incrprated r unincrprated jint venture, trust crpratin r ther entity (r any arrangements relating t such interest) being term inated, mdified r being required t be dispsed f; the assets f TIA r any f its Subsidiaries being sld, transferred r ffered fr sale r transfer, including under any pre-emptive rights r similar prvisins; r the business f TIA r any f its Subsidiaries with any ther persn being adversely affected. 7. N material acquisitins, dispsals, changes in the cnduct f business r dividends Between the Annuncement Date and the end f the Offer Perid (each inclusive), neither TIA nr any f its Subsidiaries: _6 6

10 acquires r dispses f, r enters int agrees t enter int r annunces any agreement fr the acquisitin r dispsal f, any asset r business, r enters int any transactin, which wuld r wuld reasnably be likely t invlve a material change in the manner in which TIA and its Subsidiaries cnduct their business; including withut limitatin, any agreement r transactin which wuld r (subject t ne r mre cnditins) may invlve TIA r any f its Subsidiaries: entering int any cntract, cmmitment r arrangement (including the acquisitin f, r ffering r agreeing t acquire, any asset r the entering int, r ffering r agreeing t enter int, any jint venture, partnership, farm-in r management agreement) that is nt in the rdinary curse f business; entering int any agreement r arrangement with respect t derivative instruments (including swaps, futures cntracts, frward cmmitments, cmmdity derivatives r ptins) r similar instruments, except freign currency hedges made in the rdinary and usual curse f business and in accrdance with existing plicy in place as at the Annuncement Date; r gives r agrees t give any Encumbrance ver any f its assets, ther than liens in the rdinary and usual curse f business; makes any change t its cnstitutinal dcuments; amends the terms f issue f any f the Shares r ther securities (including perfrmance rights and ptins); enters int a cntract r cmmitment restraining it frm cmpeting with any persn r cnducting activities in any market r vluntarily changes any accunting plicy applied by them t reprt their financial psitin; enters int, amends, r agrees t enter int r amend, any cntract, cmmitment r ther arrangement with a related party f TIA; enters int r materially amends any emplyment, cnsulting, severance r similar agreement r arrangement with fficers, directrs, ther executives r emplyees f TIA r a Subsidiary r therwise materially increasing cmpensatin r benefits fr any f the abve ther than in the rdinary curse f business r pursuant t cntractual arrangements in effect n the Annuncement Date; enters int any enterprise bargaining agreement ther than in the rdinary curse f business r pursuant t cntractual arrangements in effect n the Annuncement Date r amends in any material respect any arrangement with its financial adviser, r enters int arrangements with a new financial adviser, in respect f the Offer; r annunces an intentin t pay, pays r declares any dividend r ther distributin, ther than: a dividend r distributin t be made by TIA with the prir written cnsent f Oasis Star; r a dividend r distributin t be made by a Subsidiary f TIA where the nly recipient f that dividend r distributin is TIA r a whlly-wned Subsidiary f TIA _6 7