DISCLOSEABLE TRANSACTION INVOLVING DISPOSAL OF THE ENTIRE ISSUED SHARE CAPITAL IN RICHROAD GROUP LIMITED

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1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. R14.58(1) Note 5 to R13.52 (incorporated in Bermuda with limited liability) (Stock Code: 982) R13.51A DISCLOSEABLE TRANSACTION INVOLVING DISPOSAL OF THE ENTIRE ISSUED SHARE CAPITAL IN RICHROAD GROUP LIMITED THE DISPOSAL The Board announces that on 20 September 2016 (after trading hours of the Stock Exchange), the Vendor, a direct wholly-owned subsidiary of the Company, entered into the Disposal Agreement with the Purchaser, pursuant to which the Vendor has agreed to sell, and the Purchaser has agreed to acquire, the Sale Share, representing the entire issued share capital of the Disposed Company, at a total consideration of HK$3,140,000. Upon Completion, each member of the Disposed Group has ceased to be a subsidiary of the Company and their financial results will no longer be consolidated into the Company s consolidated financial statements. LISTING RULES IMPLICATION As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Disposal are more than 5% but all are less than 25%, the Disposal constitutes a discloseable transaction on the part of the Company under Chapter 14 of the Listing Rules and is subject to the reporting and announcement requirements under the Listing Rules. THE DISPOSAL Reference is made to the announcement of the Company dated 18 August The Board announces that on 20 September 2016 (after trading hours of the Stock Exchange), the Vendor, a direct wholly-owned subsidiary of the Company, entered into the Disposal Agreement with the Purchaser, pursuant to which the Vendor has agreed to sell, and the Purchaser has agreed to acquire, the Sale Share, representing the entire issued share capital of the Disposed Company, at a total consideration of HK$3,140,000. Details of the Disposal Agreement are set out below: * For identification purposes only 1

2 THE DISPOSAL AGREEMENT Date: 20 September 2016 R14.58(3) Parties: (i) Vendor: Miracle View Group Limited, a direct wholly-owned subsidiary of the Company; and (ii) Purchaser: Best Guard Global Limited The Purchaser is an investment holding company incorporated in the British Virgin Islands. To the best of the Directors knowledge, information and belief and having made all reasonable enquiries, each of the Purchaser, its ultimate beneficial owner(s) and their respective associates is a third party independent of the Company and its connected persons as at the date of this announcement. Assets to be disposed of Pursuant to the Disposal Agreement, the Vendor has agreed to sell, and the Purchaser has agreed to acquire the Sale Share, representing the entire issued share capital of the Disposed Company. R14.58(2) R14.58(3) R19.60(1) &(2) Further information on the Disposed Group is set out in the section headed Information on the Disposed Group in this announcement. Consideration The total consideration for the sale and purchase of the Sale Share is HK$3,140,000, which has been paid by the Purchaser to the Vendor in cash at Completion by way of a cashier order issued by a licensed bank in Hong Kong drawn in favour of the Vendor (or its nominee) or in such manner as agreed by the Vendor and the Purchaser. The consideration was arrived at after arm s length negotiation between the Vendor and the Purchaser with reference to (i) the reasons for the Disposal as disclosed in the section headed Reasons for the Disposal in this announcement; (ii) the unaudited consolidated net assets value of the Disposed Group as at 30 June 2016 of approximately HK$3,008,000; and (iii) the valuation of the Sale Share as at 30 June 2016 of approximately HK$3,080,000 to HK$3,140,000. R14.58(4) R14.58(5) The Directors consider that the terms and conditions of the Disposal, including the consideration are fair and reasonable and are in the interests of the Company and the Shareholders as a whole. 2

3 Conditions precedent and Completion The Disposal Agreement is unconditional and Completion has taken place simultaneously upon the signing of the Disposal Agreement. Upon Completion, each member of the Disposed Group has ceased to be a subsidiary of the Company and their financial results will no longer be consolidated into the Company s consolidated financial statements. R14.60(6) The Remaining Group has been providing bookkeeping, financial accounting and other administrative and human resources services to the Disposed Group. As the Disposed Group was part of the Group prior to Completion, no formal agreement has been entered into for the provision of the aforementioned services prior to Completion. The Remaining Group will continue to provide the aforementioned services to the Disposed Group after Completion and such arrangement has been formalised in writing at Completion. INFORMATION ON THE DISPOSED GROUP The Disposed Company is a company incorporated in the British Virgin Islands on 5 March 2008 with limited liability which, immediately prior to the Completion, was an indirect wholly-owned subsidiary of the Company. The Disposed Group is principally engaged in provision of translation services. The following table summarises the unaudited consolidated financial results of the Disposed Group prepared in accordance with the Hong Kong Financial Reporting Standards for the two years ended 31 December 2015 and the six months ended 30 June 2016: For the year ended 31 December 2014 For the year ended 31 December 2015 For the six months ended 30 June 2016 (unaudited) (unaudited) (unaudited) HK$ 000 HK$ 000 HK$ 000 R14.58(7) Profit/(Loss) before taxation 3,041 2,782 (1,833) Profit/(Loss) after taxation 2,489 2,176 (1,916) Based on the unaudited consolidated financial statement of the Disposed Group for the six months ended 30 June 2016 prepared in accordance with the Hong Kong Financial Reporting Standards, the unaudited consolidated net assets of the Disposed Group as at 30 June 2016 was approximately HK$3,008,000. R14.58(6) 3

4 REASONS FOR THE DISPOSAL The Group is principally engaged in the provision of financial printing services, which mainly include the printing of IPO prospectuses, financial reports, company announcements, circulars, legal compliance documents, research reports, corporate brochures and newsletters. The Group is also engaged in property investment and financial advisory services in Hong Kong. R14.58(8) R14.58(2) Although the Disposed Group had recorded profits for the two years ended 31 December 2015, according to the unaudited consolidated management account of the Disposed Group, the Disposed Group recorded a net loss of approximately HK$1,916,000 for the six months ended 30 June In view of unfavourable market factors in respect of the translation business sector including, among other things, increasing competition and the increase in operating costs (in particular labour cost), the Board expects the operation of the Disposed Group s translation business in the near future to be full of hardship. While it has been the Group s focus to enhance the competitiveness of its core business, the Company has been continuously evaluating the current businesses of the Group with an aim to streamline its business for the purpose of increasing its overall performance and costeffectiveness. In light of this and with the aim of improving the utilization efficiency of the Group s assets, the Group has decided to outsource all of its translation works and to dispose of the Disposed Group, which is principally engaged in provision of translation services. The Directors consider that the Disposal represents a good opportunity for the Group to improve its operating efficiency by streamlining its deteriorating operating segment and will have limited impact on the overall business operation of the Group. On the other hand, since the translation business has not been the Group s core business, streamlining the Group s corporate structure through the Disposal would allow the Group to focus its resources on its other principal business or other investment opportunities which may generate a better return for the Company and the Shareholders as a whole. The Directors consider that the Disposal and the transactions contemplated under the Disposal Agreement have been made on normal commercial terms and that such terms are fair and reasonable and that the Disposal contemplated under the Disposal Agreement are in the interests of the Company and the Shareholders as a whole. FINANCIAL EFFECT OF THE DISPOSAL AND USE OF PROCEEDS As a result of the Disposal, subject to the review by the auditors of the Company, it is estimated that the Group will record a loss of approximately HK$248,000 from the Disposal. Such loss is estimated based on the gross proceeds from the Disposal of HK$3,140,000 less the aggregate of the net assets of the Disposed Group as at 30 June 2016 of approximately HK$3,008,000 and the relevant expenses for the Disposal of approximately HK$380,000. After deducting the expenses relating to the Disposal, it is expected that there will be a net proceeds of approximately HK$2,760,000 from the Disposal. The Board intends to apply the net proceeds from the Disposal as general working capital of the Group. R14.60(3) (a) R14.60(3) (b) 4

5 LISTING RULES IMPLICATIONS As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Disposal are more than 5% but less than 25%, the Disposal constitutes a discloseable transaction on the part of the Company under Chapter 14 of the Listing Rules and is subject to the reporting and announcement requirements under the Listing Rules. DEFINITIONS In this announcement, unless the context otherwise requires, the following words and expressions shall have the following meanings when used herein: associates(s) Board Business Day Company Completion connected person(s) Director(s) Disposal has the meaning ascribed thereto under the Listing Rules the board of Directors a day (excluding Saturday, Sunday, public holiday of Hong Kong and any day on which a tropical cyclone warning no. 8 or above is hoisted or remains hoisted between 9:00 a.m. and 5:00 p.m. and is not lowered at or before 5:00 p.m. or on which a black rainstorm warning is hoisted or remains in effect between 9:00 a.m. and 5:00 p.m. and is not discontinued at or before 5:00 p.m.) on which licensed banks in Hong Kong are generally open for business throughout their normal business hours ione Holdings Limited, a company incorporated in Bermuda with limited liability, the issued Shares of which are listed on the Main Board of the Stock Exchange (Stock code: 982) completion of the Disposal in accordance with the terms and conditions of the Disposal Agreement has the meaning ascribed thereto under the Listing Rules the director(s) of the Company the proposed disposal of the Sale Share by the Vendor to the Purchaser pursuant to the terms and conditions of the Disposal Agreement Disposal Agreement the sale and purchase agreement dated 20 September 2016 entered into between the Vendor and the Purchaser in relation to the Disposal 5

6 Disposed Company Disposed Group Group Guangzhou ione Translation Hong Kong ione Translation Listing Rules PRC Purchaser Remaining Group Sale Share Shares Shareholders Stock Exchange Richroad Group Limited, a company incorporated in the British Virgin Islands with limited liability which, immediately prior to Completion, was an indirect whollyowned subsidiary of the Company the Disposed Company and its subsidiaries and branch office, including ione Translation and Guangzhou ione Translation the Company and its subsidiaries (Guangzhou ione Translation Service Co., Ltd.), a company established in the PRC with limited liability and is wholly owned by ione Translation the Hong Kong Special Administrative Region of the PRC ione Translation Company Limited, a company incorporated in Hong Kong with limited liability and is wholly owned by the Disposed Company the Rules Governing the listing of securities on the Stock Exchange the People s Republic of China, which for the purpose of this announcement, excludes Hong Kong, Macau Special Administrative Region of the PRC and Taiwan Best Guard Global Limited, a company incorporated in the British Virgin Islands with limited liability the Group excluding the Disposed Group one (1) issued share in the issued share capital of the Disposed Company, representing the entire issued share capital thereof, which, immediately prior to Completion, was legally and beneficially owned by the Vendor ordinary share(s) of HK$ each in issued share capital of the Company holders of the issued Shares The Stock Exchange of Hong Kong Limited 6

7 Vendor HK$ Miracle View Group Limited, a company incorporated in the British Virgin Islands with limited liability and a direct wholly-owned subsidiary of the Company Hong Kong dollars, the lawful currency of Hong Kong % per cent. By Order of the Board ione Holdings Limited Li Guangning Chairman Hong Kong, 20 September 2016 As at the date of this announcement, the board of Directors comprises Mr. Li Guangning (executive Director and chairman), Mr. Xie Wei (executive Director and chief executive officer), Ms. Zhong Ming (executive Director and chief financial officer); Ms. Zhang Kuihong (non-executive Director); Dr. Chen Jieping, Dr. Sun Mingchun and Mr. Tse Yung Hoi (all being independent non-executive Directors). R2.14 The English name(s) of the PRC entity(ies) referred to in this announcement is/are translation(s) from its/their Chinese name(s) and is/are for identification purposes only. If there is any inconsistency, the Chinese name(s) shall prevail. 7