Honyu Wear-Resistant New Materials Co., Ltd. (SZSE:300345) signed an agreement to acquire 75% stake in Shenzhen Prize Technology Co., Ltd. from Shenzhen Kusai Investment Enterprise (Limited Partnership) and Shenzhen Bohui Technology Co., Ltd. for approximately CNY 910 million on November 19, 2019. The shares to be issued as consideration will be issued at CNY 8.00 per share. Honyu Wear-Resistant New Materials will pay 252.4 million cash and issue 6.3 million shares to Shenzhen Kusai Investment Enterprise (Limited Partnership) for its 36% stake and will issue 41 million shares to Shenzhen Bohui Technology Co., Ltd. for its 39% stake. Honyu Wear-Resistant New Materials will raise CNY 270 million by issuing shares and will use the proceeds a month other uses to pay the cash consideration for the transaction. The company is to issue shares to not more than 5 designated investors in a private placement including Hunan Huamin Capital Group Co., Ltd. and Lu Guanghui. Not more than 88,259,100 shares are to be issued. As of December 31, 2018, Shenzhen Prize Technology reported net assets of CNY 70.4 million and total assets of CNY 76.5 million. For the year ended December 31, 2018, Shenzhen Prize Technology reported revenue of CNY 82.3 million, operating profit of CNY 40 million and net profit of CNY 40.6 million. The transaction is subject to Honyu Wear-Resistant New Materials’ Directorate’s approval after the audit and assessment reports are issued, approval of shareholders of Honyu Wear-Resistant New Materials and CSRC and other necessary approvals. On November 19, 2019, 6th Meeting of the 4th Directorate and the 5th Meeting of the 4th Supervisory Board of Honyu Wear-Resistant New Materials, shareholders of Shenzhen Prize Technology, partners of Shenzhen Kusai Investment Enterprise (Limited Partnership) and shareholders of Shenzhen Bohui Technology approved the transaction. Li Wei, Chen Shixin of Kaiyuan Securities Co., Ltd. acted as a financial advisor to Honyu Wear-Resistant New Materials Co., Ltd. Liu Chuncheng and Luo Jinhang of Tian Yuan Law Firm acted as a legal advisor to Honyu Wear-Resistant New Materials Co., Ltd. Qiu Junzhou and Liu Shengwen of Moore Stephens Da Hua acted as accountant to Honyu Wear-Resistant New Materials Co., Ltd.