China Kepei Education Group Limited (SEHK:1890) and Zhaoqing Kepei Education Investment Development Co., Ltd entered into a Equity Transfer Agreement to acquire Harbin Institute of Petroleum from Xie Yongli and Wang Fu for CNY 1.4 billion on January 13, 2020. As per the terms of the transaction the total consideration is payable in three tranches. The first payment is of sum CNY 450 million is paid on or after February 10, 2020 subject to satisfaction of certain conditions where Harbin Institute of Petroleum and Huarui having passed the necessary resolutions approving the acquisition, execution of the management entrustment agreement among Zhaoqing Kepei, Huarui, Xie Yongli and Harbin Institute of Petroleum, no objection having been received from the relevant government authorities in respect of the acquisition, the representations and warranties given by Xie Yongli, Wang Fu the and Huarui under the equity transfer agreement having remained true, accurate and not misleading in all respects. The second payment of sum CNY 700 million is paid within 10 working days upon the satisfaction of certain conditions, where the conditions for the first payment having been satisfied, the application for change of sponsor of the Harbin Institute of Petroleum having been completed and approved by the competent authorities such that Huarui becomes the sole sponsor of Harbin Institute of Petroleum, the transfer of the 100% equity interest in Huarui by the Xie Yongli and Wang Fu to Zhaoqing Kepei Education Investment Development Co., Ltd and the relevant administration for industry and commerce registration having been completed and the completion of the restructuring in accordance with the equity transfer agreement. The final payment of sum CNY 300 million will be paid on September 15, 2020 or within 10 working days upon the satisfaction of the conditions for the second payment, whichever is later. The consideration shall partially be funded by the portion of IPO net proceeds and partially by the group’s internal financial resources and/or loans from third party banks. At Completion, the sponsorship interest in the Target School will be wholly owned by Huarui. As of December 31, 2018 Harbin Institute of Petroleum reported EBIT of CNY 68.4 million, total assets approximately CNY 850 million and net asset value approximately CNY 760 million. The Equity Transfer Agreement may be terminated by a non-defaulting party if there is any material breach by any other party or by unanimous written consent of the parties or if the Ministry of Education of the PRC does not approve the application in relation to the change of sponsor of the Harbin Institute of Petroleum to Huarui within 365 days from the date of such application. China Kepei Education Group Limited (SEHK:1890) and Zhaoqing Kepei Education Investment Development Co., Ltd completed the acquisition of Harbin Institute of Petroleum from Xie Yongli and Wang Fu March 29, 2021. The transaction has been approved by regulatory board.