Future Data Group Limited — M&A Activity 2019

Jun 20, 2019

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.

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FUTURE DATA GROUP LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 8229)

MEMORANDUM OF UNDERSTANDING

IN RELATION TO ACQUISITION OF A TECHNOLOGY SERVICES COMPANY IN THE PEOPLE’S REPUBLIC OF CHINA

This announcement is made by the board of directors (the “ Board ”) of the Company pursuant to Rule 17.10 of the Rules Governing the Listing of Securities on GEM of The Stock Exchange of Hong Kong Limited (“ GEM Listing Rules ”) and the Insider Information Provisions under Part XIVA of the Securities and Future Ordinance.

The Board of Future Data Group Limited (the “ Company ”) is pleased to announce that Future Data Limited, a wholly-owned subsidiary of the Company, (the “ Purchaser ”) has entered into a non-binding Memorandum of Understanding (“ MoU ”) with the shareholders of Hua An Tian Wang (Beijing) Information Technology Company Limited, a Beijing based technology services company, (the “ Target Company ”) to acquire 95% equity interest in the Target Company (the “ Proposed Transaction ”) dated 20 June 2019 (after trading hours).

The Board wishes to emphasise that the Proposed Transaction is subject to, among other things, the signing of a definitive agreement, the terms and conditions of which are yet to be agreed. As the Proposed Transaction may or may not be consummated, shareholders and potential investors of the Company should exercise caution when dealing in the securities of the Company.

Memorandum of Understanding

The Board of the Company is pleased to announce that Future Data Limited, a wholly-owned subsidiary of the Company, has entered into a non-binding Memorandum of Understanding with the shareholders of Hua An Tian Wang (Beijing) Information Technology Company Limited, a Beijing based technology services company, to acquire 95% equity interest in the Target Company dated 20 June 2019 (after trading hours).

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The MoU

Date: 20 June 2019

Parties:

• (i) Future Data Limited (the “Purchaser”)

• (ii) Two natural persons who collectively hold the entire equity interest in the Target Company (the “Vendors”)

Asset to be Acquired

Pursuant to the MoU, the Purchaser seeks to acquire 95% of the equity interest in the Target Company from the Vendors. The Target Company is a limited liability company incorporated in the People’s Republic of China on 18 June 2004.

Consideration

The consideration for the Proposed Transaction will be subject to further negotiation between the parties to the MoU but the total consideration shall be not more than HK$53.2 million (Hong Kong Dollars Fifty-Three Million and Two Hundred Thousand) which may be satisfied by the Purchaser by way of cash.

Service Agreements

The Group will offer service agreements with the key persons of the Target Company for a period of five years. To reward for their long-term services in the Target Company, the Company will issue shares equivalent to a total of HK$14 million (Hong Kong Dollars Fourteen Million) payable in four equal annual instalments.

Due Diligence

After the signing of the MoU, the Company (and its agents and/or advisers) shall be entitled to full access to any personnel and properties and shall review its relevant documents, books and records related to the Target Company in the course of due diligence.

Exclusive Negotiating Right

The Vendors agreed that they shall not initiate, solicit, encourage, directly or indirectly, or accept any offer or proposal, with respect to the acquisition of the shares or assets of the Target Company by any person other than the Purchaser including, without limitation, by way of a purchase of shares, purchase of assets or merger, of all or any substantial part of the Target Company’s equity securities or assets, for the period from the date of signing the MoU up to and including 20 September 2019.

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Definitive Agreement

The Purchaser and Vendors shall proceed to the negotiation for and execute a definitive agreement on or before 20 September 2019.

If the definitive agreement is entered into, it will possibly constitute a notifiable transaction on the part of the Company pursuant to the GEM Listing Rules.

Reasons for and Benefits of the Proposed Transaction

The Target Company is principally engaged in provision of physical security technology installation project and provision of consultation services regarding advanced security solution, including the deployment of surveillance equipment and noise detection equipment. This expertise is of a similar nature to the Smart City project conducted by Global Telecom Company Limited, the Company’s wholly-owned subsidiary in Korea. The Target Company has also engaged in facial recognition and security surveillance project for government departments in several provinces and cities in China.

Through the acquisition of the Target Company, the Board is of the view that the Proposed Transaction provides an opportunity for the Group to penetrate in the market in China which is a second largest economy in the world, and build business synergy between Korea and China and use such know-how to support one-belt-one-road initiative in the area of digital security.

The Board wishes to emphasise that the Proposed Transaction is subject to, among other things, the signing of a definitive agreement, the terms and conditions of which are yet to be agreed. As the Proposed Transaction may or may not be consummated, shareholders and potential investors of the Company should exercise caution when dealing in the securities of the Company.

By Order of the Board Future Data Group Limited Suh Seung Hyun Chairman

Hong Kong, 20 June 2019

As at the date of this announcement, the executive directors of the Company are Mr. Suh Seung Hyun, Mr. Phung Nhuong Giang, Mr. Lee Seung Han and Mr. Ryoo Seong Ryul, and the independent nonexecutive directors of the Company are Mr. Wong Sik Kei, Mr. Sum Chun Ho and Mr. Yung Kai Tai.

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This announcement, for which the directors of the Company collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on GEM of The Stock Exchange of Hong Kong Limited for the purpose of giving information with regard to the Company. The directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this announcement is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this announcement misleading.

This announcement will remain on the “Latest Company Announcements” page of the GEM website at www.hkgem.com for at least 7 days from the date of its publication and on the website of the Company at www.futuredatagroup.com.

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