China Environmental Technology : INSIDE INFORMATION MEMORANDUM OF UNDERSTANDING IN RELATION TO A PROPOSED DISPOSAL OF BEIJING INNOMED WOMEN'S AND CHILDREN'S HOSPITAL

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CHINA ENVIRONMENTAL TECHNOLOGY HOLDINGS LIMITED

中國環保科技控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 646)

INSIDE INFORMATION

MEMORANDUM OF UNDERSTANDING

IN RELATION TO A PROPOSED DISPOSAL OF

BEIJING INNOMED WOMEN'S AND CHILDREN'S HOSPITAL

This announcement is made by China Environmental Technology Holdings Limited (the "Company") pursuant to Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules") and the Inside Information Provisions (as defined in the Listing Rules).

MEMORANDUM OF UNDERSTANDING

The board (the "Board") of directors (the "Directors") of the Company is pleased to announce that on 24 September 2019 (after trading hours), the wholly owned subsidiary of the Company (the "Potential Vendor") entered into a non-legally binding memorandum of understanding (the "MOU") with a potential purchaser (the "Potential Purchaser"). Pursuant to the MOU, the Potential Purchaser intends to acquire and the Potential Vendor intends to dispose of, all 90% equity interest in Beijing Jianbao Kangying Medical Technology Co., Limited ("JK"), a company established in the People's Republic of China (the "Proposed Disposal"). As a the date of MOU, the 90% equity interest in JK held by the Potential Vendor represent its entire equity interest in JK.

JK and its wholly owned subsidiary, Beijing INNOMED Women's and Children's Hospital Co., Limited ("JK Group") are principally engaged in the business of provision of medical services and hospital management in Beijing, People's Republic of China.

Principal Terms of the MOU

Date

24 September 2019 (after trading hours)

Parties

1. The Potential Purchaser; and
2. The Potential Vendor.

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, the Potential Purchaser and its ultimate beneficial owners are third parties independent of the Company and its connected persons (as defined under the Listing Rules).

Consideration

Subject to the approval of the shareholders, the consideration for the Proposed Disposal shall reference to the fair value amount as at 15 September 2019 based on independent valuation report, and in any case, shall not be less than HK$1.

Exclusivity

During the two (2) months period since the date of execution of the MOU (or such other date as agreed between the Potential Purchaser and the Potential Vendor in writing) (the "Exclusivity Period"), the Potential Purchaser shall have exclusive right to negotiate with the Potential Vendor in relation to the terms of the Proposed Disposal. During the Exclusivity Period, the Potential Vendor shall not directly or indirectly negotiate or agree with any other party with respect to the disposal of JK or any of its businesses.

Formal Agreement

The Potential Purchaser and the Potential Vendor shall use their best endeavours to procure a legally binding formal agreement in relation to the Proposed Disposal ("Formal Agreement") within the Exclusivity Period.

Termination

The MOU shall be terminated at the earlier of:

1. the expiry of the Exclusivity Period; or
2. the date of execution of Formal Agreement.

Binding Effect

Save for the provisions relating to the exclusivity, confidentiality, termination, governing law and jurisdiction, the MOU does not constitute a legally binding agreement between the parties to the MOU on the sale and purchase of the Potential's Vendor's 90% equity interest in JK.

GENERAL

As at the date of this announcement, the terms and conditions of the Proposed Disposal are still being negotiated and no legally binding agreement has been entered into. The Proposed Disposal, if materialised, may consitute a notifiable transaction for the Company under the Listing Rules. Further announcement(s) will be made by the Company as and when appropriate in compliance with the Listing Rules.

AS THE PROPOSED DISPOSAL MAY OR MAY NOT PROCEED, SHAREHOLDERS AND INVESTORS ARE REMINDED TO EXERCISE CAUTION WHEN DEALING IN THE SHARES OF THE COMPANY.

By order of the Board

China Environmental Technology Holdings Limited

XU Zhong Ping

Chairman

Hong Kong, 24 September 2019

As at the date of this announcement, the executive directors are Mr. Xu Zhong Ping, Mr. Yang Baodong and Ms. Hu Yueyue; the non-executive directors is Mr. Ma Tianfu; and the independent nonexecutive directors are Mr. Tse Chi Wai, Professor Zhu Nan Wen and Professor Li Jun.