Asset Acquisitions and Disposals::Proposed Acquisition of Singapore Orient Power Holding Pte. Ltd.

HU AN CABLE HOLDINGS LTD.

(Incorporated in Singapore)

(Company Registration Number: 200810320N)

PROPOSED ACQUISITION OF SINGAPORE ORIENT POWER HOLDING PTE. LTD.

1. INTRODUCTION

1.1 The board of Directors (the "Board") of Hu An Cable Holdings Ltd. (the "Company" and its subsidiaries, the "Group") wishes to announce that the Company had on 9 July 2021 entered into a share subscription and option agreement and a supplemental agreement (collectively, the "Agreements") with Singapore Orient Power Holding Pte. Ltd. (Singapore Company Registration Number: 201915513N) (the "Target", and together with its subsidiaries, the "Target Group") and a Yu Suiying ("Vendor"), for the acquisition of the entire issued and paid-up share capital of the Target ("Proposed Transaction"). The Proposed Transaction shall take place in two (2) stages:

1. First Stage- In the first stage ("Stage 1"), on the terms and conditions of the
   Agreements, the Company agrees to subscribe for, and the Target agrees to issue to the Company, such number of shares as shall constitute 51% of the shareholding of the enlarged share capital ("Target Subscription Shares") of the Target ("Target Shares") for an aggregate consideration of S$8,000,000 ("Subscription Consideration"), which shall be satisfied wholly in cash; and
2. Second Stage- In the second stage ("Stage 2"), for a period of 12 months from the First Completion (defined below), the Company shall have an option ("Option") to acquire from the Vendor, and the Vendor agrees to sell to the Company, upon the Option being exercised by notice in writing by the Company to the Vendor, the Vendor's entire shareholding in the equity of the Target as shall constitute 49% in the enlarged share capital ("Sale Shares") of the Target, at an aggregate consideration of S$49,000,000 ("Sale Consideration"). The Sale Consideration shall be satisfied wholly by the allotment and issuance of new issued and paid-up ordinary shares
   ("Company Shares") in the share capital of the Company ("Consideration Shares") to the Vendor, at an issue price ("Issue Price") that is the volume-weighted average price of trades in the Company Shares for the five (5) market days (which may not be consecutive market days) on which there are trades in the Company Shares immediately before (and not including) the date of notice of exercise by the Company of the Option, such Consideration Shares to be issued upon the completion of the acquisition of the Sale Shares in the manner set out in the Agreements,

where the aggregate consideration of the Proposed Transaction, comprising the Subscription Consideration and the Sale Consideration, shall be known as the "Aggregate Consideration".

1. Upon completion of the Proposed Transaction, the Target will become a wholly owned subsidiary of the Company.
2. No commission or introducer fee is paid or payable by the Company in connection with the Proposed Transaction.

1. If required, a financial adviser and/or sponsor will be appointed in due course by the Company in respect of the Proposed Transaction.
2. Stage 1 of the Proposed Transaction constitutes a major acquisition as defined under Chapter
   10 of the Listing Manual ("Listing Manual") of the Singapore Exchange Securities Trading Limited ("SGX-ST"), which is subject to, inter alia, approval of the shareholders of the
   Company ("Shareholders") at an extraordinary general meeting to be convened ("EGM"). It is the intention of the Company to consult with the SGX-ST on the appropriate classification of the Proposed Transaction.
3. Further information on the Proposed Transaction will be provided in a circular ("Circular") to be issued by the Company in due course for the purpose of convening the EGM.
4. The Company will be applying to the SGX-ST for the dealing in, listing of and quotation for the Consideration Shares and will make the necessary announcement upon receipt of the listing and quotation notice from the SGX-ST.

2. INFORMATION ON TARGET, TARGET GROUP, THE VENDOR AND THE PRC AFFILIATED ENTITY

1. All information in respect of the Target, the Vendor and the PRC Affiliated Entity is based solely on information and representations made and provided by the Target and the Vendor respectively to the Company. In respect of such information, the Company and the Directors have not independently verified the accuracy and correctness of the same and the Company's responsibility is limited to ensuring that such information has been accurately and correctly extracted and reproduced in this announcement in its proper form and context.
2. Information on the Target and Target Group
3. 1. The Target is a company incorporated in Singapore on 14 May 2019, with an issued share capital of S$490,000, of which S$2 is paid-up, and S$489,998 is unpaid. The share capital is divided into 490,000 ordinary shares and is wholly owned by the Vendor.
   2. The Target has two directors as at the date of this announcement, namely a Ho Wei Jie and a Liu Wei, where:
   3. 1. Mr Ho Wei Jie is a nominee director appointed to fulfil the requirement that a Singapore company must have a resident director. The appointment is not executive in nature, and Mr Ho is not involved in the operations of the Company; and
      2. Mr Liu Wei is a Chinese national who holds an executive MBA from Xiamen University, PRC, an associate degree in accounting from Jinan University, PRC as well as a bachelor's degree in human resource from Jilin University, PRC. Mr
         Liu has experience in the renewable energy sector and has held management positions in, inter alia, Guangdong Zhongte New Photovoltaic Energy Co., Ltd,
         Foshan Huachen Technology Co., Ltd., and is currently concurrently the Vice General Manager of Guangdong Guangte Electric Co., Ltd, the PRC Affiliated Entity (defined below), and Director of Foshan Guangrunda Investment Co., Ltd., an investment entity in the PRC.

1. As at the date of this announcement the Target has one (1) subsidiary, a 90% owned subsidiary incorporated in Vietnam on 24 May 2019, by the name of New Orient
   Renewable Energy Company ("Vietnam Subsidiary"). The remaining 10% of the shareholding in the capital of the Vietnam Subsidiary is owned by an individual by the name of Tran Viet Phuong, and the legal representative of the Vietnam Subsidiary is an individual by the name of Li Jun.
2. It is the intention of the Target, and it is a condition precedent to the completion of Stage
   1 that the Target, or its wholly owned subsidiary ("WOFE") to be established in the People's Republic of China ("PRC"), enter into management and operation agreements ("Contractual Arrangements") a Chinese entity, Guangdong Guangte Electric Co., Ltd ( 广 东 广 特 电 气 股 份 有 限 公 司 ) ("PRC Affiliated Entity"). Under the Contractual
   Arrangements, the Target and/ or the WOFE will have operational and management control of the PRC Affiliated Entity, which will allow the Target to exercise control over the business operations and enjoy substantially all the economic rights arising from the businesses of the PRC Affiliated Entity.

Business of the Target

2.2.5 The Target has nine (9) employees and is engaged in the business of investment, construction and operation on renewable power plants, power transfer and distributed grids and is active in the electric power business sector. Principally, the target is involved in providing storage solutions for renewable energy and other sources of energy that is unstable and fluctuating, as well as the investment, construction and operation in wind and solar power plants via various public private partnerships, such as the build-operate-transfer model, or the engineering, procurement and construction model. Currently, the Target, through existing contractual arrangements with the PRC Affiliated Entity, is providing management services and other services.

Information on Guangdong Guangte Electric Co., Ltd, the PRC Affiliated Entity

1. Guangdong Guangte Electric Co., Ltd, the PRC Affiliated Entity was incorporated on 20 January 2000 with a registered capital of RMB 100 million and is owned by Yu Jijiang, (72%), Foshan Guangrunda Investment Co., Ltd(佛山市广润达投资有限公司) ("Guangrunda") (18%) and Shenzhen Qianhaihongsheng No. 3 Investment Limited
   Partnership Corporation) ( 深 圳 前 海 宏 升 优 选 三 号 股 权 投 资 合 伙 企 业 （ 有 限 合 伙）)("Qianhaihongsheng") (10%).
2. Mr Yu Jijiang is the founder and legal representative of the PRC Affiliated Entity and has over 20 years of experience working in the field of new energy industry in China. Guangrunda is an investment company incorporated in the PRC, and Qianhaihongsheng is a limited partnership established in the PRC. None of the shareholders of the PRC Affiliated Entity affiliated directly or indirectly to the Directors and/or substantial Shareholders of the Company. Mr Yu Jijiang is related to the Vendor.
3. The PRC Affiliated Entity is based in Guangdong and is located on a site covering 50,000 square metres owned by itself, and is in the principal business of research and development and production and sales of power transmission and control equipment. The PRC Affiliated Entity owns, inter alia, two (2) national patents for invention of core technology, and utility model patents for new technology in 12 original products in areas such as environment conservation, and energy saving. The corporate website of the PRC Affiliated Entity can be accessed at www.fsgt.com.cn.

Financial Information on the PRC Affiliated Entity

2.2.9 In respect of the financial year ended 31 December 2020, the PRC Affiliated Entity had a revenue of approximately RMB 268,839,012, net profit after tax of approximately RMB 707,370, and as at 1 January 2021, an order book of approximately RMB 179,765,900 to be fulfilled for the next six (6) months.

These are based on management accounts provided by the PRC Affiliated Entity prepared in accordance with the financial accounting standards of the PRC.

Financial Information on the Target Group

2.2.10The Target, and its Vietnam Subsidiary were each incorporated in May 2019. The Vietnam Subsidiary is newly set up and is currently dormant. A summary of the pro forma financial information of the Target Group for the financial years ended 31 March

2020 (unaudited) and 31 March 2021 (unaudited), is set out as follows:

Statement of comprehensive income

Income

Net Profit/(Loss) before Tax

Income Tax

Net Profit/(Loss) after Tax

Statement of financial position

Total Assets

Total Liabilities

Net Assets/(Liabilities)

	14 May 2019 -		1 Apr 2020 -
	31 March 2020		31 March 2021
	S$		S$
	-	5,880,643
	(643)	5,179,545
	-	859,163
	(643)	4,320,382

	As at		As at
	31 March 2020		31 March 2021
	S$		S$
	844,385	6,695,090
	845,026	2,375,349
	(641)	4,319,741

1. Information on the Vendor
   The Vendor is a Canadian national and is the legal and beneficial owner of the entire issued and paid-up capital of the Target. The Vendor is an investor and is not affiliated directly or indirectly to the Directors and/or substantial Shareholders of the Company. The Vendor is related to Mr Yu Jijiang, who owns 72% of the shares of the PRC Affiliated Entity. The Target was set up by the Vendor to provide a platform for the PRC Affiliated Entity to develop and expand its business operations outside of the PRC.
   The Vendor was introduced to the Company through a Director of the Company, Mr Fang Huasheng.
2. None of the Vendor, directors of the Target and/or the shareholders and directors of the PRC Affiliated Entity have any shareholding interests in the Company.

3. THE PROPOSED TRANSACTION

3.1 Consideration and Completion under the Agreements

3.1.1 The Proposed Transaction shall take place in two (2) stages, as follows:

1. The Subscription Consideration for Stage 1 shall be satisfied wholly in cash, in such tranches and at such time as the Company may in its sole discretion determine, provided that the first such tranche of the Subscription Consideration paid by the Company shall be no less than S$3,000,000, and the entirety of the Subscription Consideration shall be paid by no later than 31 March 2022, or by such date as may be agreed between the Target and the Company. The
   Subscription Shares to be issued, and the Company's shareholding in the Target shall be proportionately increased with each payment of the Subscription Consideration, each such payment to be regarded as a completion constituting partial completion of Stage 1 ("First Completion") such that, until and upon the full payment of the Subscription Consideration, the Company shall hold 51% of the shareholding of the enlarged share capital of the Target; and
2. The Sale Consideration shall be satisfied wholly by the allotment and issuance of the Consideration Shares and shall be paid upon completion of the sale and purchase of the Sale Shares concurrent with completion ("Second Completion") of Stage 2.

The First Completion and the Second Completion to be known collectively as the "Completions" and each a "Completion".

Each Completion shall be conditional upon the fulfilment or waiver (as the case may be) of the conditions precedent of the First Completion and Second Completion respectively. The Second Completion shall also be conditional upon the completion of the First Completion.

The First Completion shall take place on the date falling five (5) business days (being a day, excluding Saturdays, Sundays and public holidays in Singapore, on which banks are open for normal banking business in Singapore) ("Business Day"), after the later of (i) the date on which all the conditions precedent for the First Completion as set out in the Agreements have been fulfilled or waived; and (ii) the Company having notified the Target of its readiness to pay all or part (as the case may be) of the Subscription Consideration, or such other date as the parties to the Agreements may agree in writing. Where completion of the subscription of the Subscription Shares occurs in tranches, each such completion shall be known as a First Completion.

The Second Completion shall take place on the date falling five (5) Business Days after the later of (i) the date on which all the conditions precedent for the Second Completion as set out in the Agreements have been fulfilled or waived; and (ii) the Option having been exercised, or such other date as the parties to the Agreements may agree in writing.

3.1.2 The Aggregate Consideration and the Issue Price was arrived at on a willing-buyerwilling-seller basis taking into account, inter alia, the following:

1. the profit of the Target for the financial year ended 31 March 2021;