Dongyue Group Limited

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.

This announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities of the Company.

This announcement is not for distribution, directly or indirectly, in or into the United States. This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The Company’s shares mentioned in this announcement have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”) and may not be offered or sold in the United States except pursuant to registration or an exemption from the registration requirements of the Securities Act. No public offering of the Company’s shares will be made in the United States.

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 189)

COMPLETION OF PLACING OF NEW SHARES UNDER THE GENERAL MANDATE

Placing Agents

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The Board is pleased to announce that all Conditions as set out in the Placing Agreement have been satisfied and Completion took place on 8 September 2021. An aggregate of 145,000,000 Placing Shares have been placed to not less than six Placees at the Placing Price per Placing Share pursuant to the terms and conditions of the Placing Agreement.

Reference is made to the announcement of the Company dated 1 September 2021 in respect of the placing of new Shares under the General Mandate.

COMPLETION OF PLACING

The Board is pleased to announce that all Conditions as set out in the Placing Agreement have been satisfied (including the granting of approval by the Listing Committee of the Stock Exchange for the listing of and permission to deal in the Placing Shares on the Stock Exchange) and Completion took

place on 8 September 2021. An aggregate of 145,000,000 Placing Shares have been placed to not less than six Placees at the Placing Price of HK$23.00 per Placing Share pursuant to the terms and conditions of the Placing Agreement.

The Placing Price of HK$23.00 per Placing Share represents a discount of approximately 0.09% to the average closing price of HK$23.02 per Share as quoted on the Stock Exchange for the five (5) consecutive trading days immediately prior to and excluding the date of the Placing Agreement and a discount of approximately 4.29% to the average closing price of approximately HK$24.03 per Share as quoted on the Stock Exchange for the five (5) consecutive trading days immediately prior to and including the date of the Placing Agreement.

To the best of the knowledge, information and belief of the Directors and having made all reasonable enquiries, the Placees and their respective ultimate beneficial owner(s), as applicable, are Independent Third Parties. None of the Placees has become a substantial Shareholder of the Company immediately upon Completion.

The gross proceeds and the net proceeds (after deduction of the relevant expenses and fees) from the Placing amounted to HK$3.335 billion and approximately HK$3.31 billion, respectively. The Company intends to allocate the net proceeds as follows:

			Approximate
			percentage of
			total net
	Usage	Amount	proceeds
(a)	Enhancing the Group’s production capacity of PVDF	Approximately	60.42%
	(a type of fluoropolymer that is climate resistant and	HK$2.0 billion
	highly machinable with excellent mechanical properties,
	which can be used as weather-resistant coating
	materials, adhesives for lithium batteries and
	photovoltaic backplanes) and its raw material
	(being R142b coolant)
(b)	Enhancing the Group’s production capacity of PTFE	Approximately	24.17%
	(a synthetic fluoropolymer with high level of resistance	HK$800 million
	to temperature changes, electrical insulation, and aging
	and chemical resistant) and its raw material
	(being R22 coolant)
(c)	Replenishing the general working capital of the Group	Approximately	15.41%
		HK$510 million

SHAREHOLDING STRUCTURE OF THE COMPANY UPON COMPLETION OF THE PLACING

The Placing Shares represent:

(a) Approximately 6.87% of the issued share capital of the Company immediately before Completion; and
(b) Approximately 6.43% of the issued share capital of the Company as enlarged upon Completion.

The shareholding structure of the Company immediately before and after Completion is as follows:

	Immediately before	Completion	Immediately after	Completion
		Approximate		Approximate
		percentage of		percentage of
	Number of	issued share	Number of	issued share
	Shares	capital	Shares	capital
Macrolink Overseas Development Limited(1)	150,000,000	7.10%	150,000,000	6.65%
MACRO-LINK International Investment
Co., Ltd.(2)	418,405,818	19.81%	418,405,818	18.54%
Dongyue Team Limited(3)	258,948,451	12.26%	258,948,451	11.47%
Mr. Zhang Jianhong(4)	7,147,636	0.34%	7,147,636	0.32%
Mr. Zhang Jian(5)	91	0.00%	91	0.00%
Mr. Zhang Zhefeng(6)	650,000	0.03%	650,000	0.03%
The Placees	–	–	145,000,000	6.43%
Other public Shareholders	1,276,537,459	60.45%	1,276,537,459	56.57%
Total issued Shares	2,111,689,455	100.00%	2,256,689,455	100.00%

Notes:

(1) Macrolink Overseas Development Limited is wholly-owned by MACRO-LINK International Investment Co., Ltd.
(2) MACRO-LINK International Investment Co., Ltd. is wholly-owned by Macro-Link Industrial Investment Limited, which in turn is wholly-owned by Macro-Link Holding Limited. Macro-Link Holding Limited is owned (i) as to 93.4% by Cheung Shek Investment Limited, a company controlled by Mr. Fu Kwan (one of our executive Directors) and Ms. Xiao Wenhui; and (ii) as to 2.83% by Mr. Fu Kwan, respectively.
(3) Dongyue Team Limited is wholly-owned by Mr. Zhang Jianhong, one of our executive Directors.
(4) Mr. Zhang Jianhong is one of our executive Directors.
(5) Mr. Zhang Jian is one of our executive Directors.
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(6) Mr. Zhang Zhefeng is one of our executive Directors.

DEFINITIONS

In this announcement, unless the context otherwise requires, the following words and expressions shall have the following meanings when used herein:

“Board”	the board of Directors
“Company”	Dongyue Group Limited (stock code: 189), a company incorporated
	in the Cayman Islands with limited liability, the Shares of which
	are listed on the Main Board of the Stock Exchange
“Completion”	completion of the Placing pursuant to the Placing Agreement,
	which took place on the sixth business day after the date of the
	Placing Agreement, being the date of this announcement
“Conditions”	the conditions precedent to Completion under the Placing
	Agreement
“Director(s)”	the director(s) of the Company
“General Mandate”	the general mandate granted by the Shareholders to the Directors at
	the annual general meeting of the Company held on 10 June 2021,
	under which the Directors were authorised to allot, issue and deal
	with up to a maximum of 422,337,891 Shares (being 20% of the
	issued share capital of the Company at the date of passing of the
	relevant resolution)
“Group”	the Company and its subsidiaries (from time to time)
“HK$”	Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong”	the Hong Kong Special Administrative Region of the PRC
“Independent Third	party(ies) who is(are) not connected persons of the Company and
Party(ies)”	is(are) third party(ies) independent of the Company and its
	connected persons in accordance with the Listing Rules
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange

“Placee(s)”	any individuals, corporate, institutional or other investor(s)
	procured by the Placing Agents or its agents to subscribe for any
	of the Placing Shares pursuant to the Placing Agreement
“Placing”	the placing, on a best effort basis, of 145,000,000 Placing Shares on
	and subject to the terms and conditions set out in the Placing
	Agreement
“Placing Agents”	collectively, CLSA Limited and China International Capital
	Corporation Hong Kong Securities Limited
“Placing Agreement”	the conditional placing agreement entered into between the
	Company and the Placing Agents dated 31 August 2021 in
	relation to the Placing
“Placing Price”	HK$23.00 per Placing Share
“Placing Shares”	145,000,000 new Shares to be placed pursuant to the Placing
	Agreement and to be issued under the General Mandate, each a
	“Placing Share”
“PRC”	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
“Shareholder(s)”	the holder(s) of the Shares
“Share(s)”	the ordinary share(s) of HK$0.10 each in the share capital of the
	Company
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“United States”	the United States of America
“%”	per cent.

In this announcement, unless the context otherwise requires, the terms “associate(s)”, “close associate(s)”, “connected person(s)”, “connected transaction(s)”, “controlling shareholder(s)”, “subsidiary(ies)” and “substantial shareholder(s)” shall have the meanings given to such terms in the Listing Rules, as modified by the Stock Exchange from time to time.

By Order of the Board Dongyue Group Limited Zhang Jianhong Chairman

The PRC, 8 September 2021

As at the date of this announcement, the Directors are Mr. Zhang Jianhong, Mr. Fu Kwan, Mr. Wang Weidong, Mr. Zhang Zhefeng, Mr. Zhang Bishu and Mr. Zhang Jian as executive Directors, and Mr. Ting Leung Huel, Stephen, Mr. Yang Xiaoyong and Mr. Ma Zhizhong as independent non-executive Directors.

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Dongyue Group Limited Capital/Financing Update 2021

49020_rns_2021-09-08_b0235d7c-b19f-4fcf-a181-ede102ab21d8.pdf