Greenheart Group Limited — M&A Activity 2000

Aug 10, 2000

The Stock Exchange of Hong Kong takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

renren Media Limited

(incorporated in Bermuda with limited liability)

ANNOUNCEMENT

MEMORANDUM OF UNDERSTANDING

The Directors announce that ASL has on 8th August, 2000 entered into the MOU with GMA. GMA and its beneficial owners are not connected with any of the Company, of the Company's directors, chief executive and substantial shareholders, and of the Company's subsidiaries or their respective associates within the meaning of the Listing Rules.

Pursuant to the MOU, upon completion of financial and legal due diligence on ASL to the satisfaction of GMA, GMA may make a written offer to acquire from the Company the legal and beneficial interest, either in its entirety or in part, in the issued share capital of ASL. ASL is engaged in the provision of aftersales service, including repair and maintenance services of motor vehicles and the sale of spare parts. Pursuant to the MOU, GMA will either strive to complete the due diligence investigation and present to the Company an offer to buy or, at GMA's election, advise the Company of the termination of the MOU no later than 18th October, 2000. The term of the MOU is subject to extension or early termination pursuant to the agreement of the Parties in writing.

The Group is currently engaged in the car distribution of Saab vehicles in Hong Kong and China. Two distribution agreements with Saab Automobile AB will expire in September, 2000 and in December, 2000, respectively. The Group has no information at this stage as to whether or not the car distribution rights under the existing distribution agreements with Saab Automobile AB will be renewed upon expiration of the distribution agreements. If the Potential Acquisition proceeds and if the distribution agreements were not renewed upon their expiration in September, 2000 and December, 2000 respectively by Saab Automobile AB, then it would be difficult for the Company to follow the “Future Intentions” of augmenting the Group’s car distributing business using the Internet as an additional distribution channel as disclosed in the circular dated 20th April, 2000 due to changes in the business circumstances which are outside the control of the Company or its Directors.

Irrespective of the outcome of the Potential Acquisition or the renewal of the car distribution rights, it is the intention of the Group that it will expand its Internet business under the “www.renren.com” domain name which the Company commenced operating around May, 2000.

No terms (which include but not limited to the consideration of the Potential Acquisition) have been finalised and discussions are still ongoing between the respective Parties. It is not known whether or not the Potential Acquisition will materialise. Shareholders of the Company and the public investors are advised to exercise caution when dealing in the shares of the Company.

If the Potential Acquisition proceeds, based on the latest audited figures of the Company as of 31st December, 1999, it may constitute a major transaction under Chapter 14 of the Listing Rules which will require approval by the shareholders of the Company and a circular regarding the major transaction will be required to be dispatched to the shareholders of the Company pursuant to the Listing Rules.

The Company also noted the recent increases in the price and trading volume of the shares of the Company and wishes to state that, save as disclosed in this announcement and the announcement dated 24th July, 2000, the Company is not aware of any reasons for such increases.

The Directors shall promptly inform the public as and when any terms concerning the Potential Acquisition have been agreed or any agreement has been signed in accordance with the Listing Rules.

THE MOU

Date of the MOU

8th August, 2000

Parties

(i) GMA, an independent third party of the Company. GMA and its beneficial owners are not connected with any of the Company, of the Company's directors, chief executive and substantial shareholders, and of the Company's subsidiaries or their respective associates within the meaning of the Listing Rules.

(ii) ASL

Description of the MOU

Pursuant to the MOU, upon completion of financial and legal due diligence on ASL to the satisfaction of GMA, GMA may make a written offer to acquire the legal and beneficial interest, either in its entirety or in part, in the issued share capital of ASL from the Company. ASL is engaged in the Aftersales Service Business.

Pursuant to the MOU, GMA will either strive to complete the due diligence investigation and present to the Company an offer to buy or, at GMA's election, advise the Company of the termination of the MOU no later than 18th October, 2000. The term of the MOU is subject to extension or early termination pursuant to the agreement of the Parties in writing.

Pursuant to the MOU, the implementation of the Potential Acquisition will be subject to the following conditions:

a. Completion of a due diligence to the satisfaction of GMA on ASL;

b. Fair valuation of assets and liabilities on ASL;

c. Compliance with all applicable legal and regulatory requirements in Hong Kong; and

d. Other conditions customary for transactions of this type.

The MOU is non-legally binding and it is not known whether or not the Potential Acquisition will materialize. Financial due diligence will be conducted by GMA which will include but not limited to, checking the financial statements, books and records and all other relevant information relating to the Aftersales Service Business. Legal due diligence will also be conducted by GMA at the same time.

Future Intentions

The Group is currently engaged in the distribution of Saab vehicles in Hong Kong and China. Two distribution agreements with Saab Automobile AB will expire in September, 2000 and in December, 2000 respectively. The Group has no information at this stage as to whether or not the car distribution rights under the existing distribution agreements with Saab Automobile AB will be renewed upon expiration of the distribution agreements. As disclosed in the circular dated 20th April, 2000, it is the intention of renren Media Holdings Limited that the Group would seek to augment the Group’s existing business using the Internet as an additional distribution channel and to diversify the Group’s business into the Internet sector under the trade name “renren.com”. The Group has been in the process of discussing the feasibility of establishing Internet consumer channel which includes automobiles as part of the shopping network and developing e-commerce platform whereby consumers may be able to make price comparison of vehicles’ and other relevant features of automobile purchases. However, if the Potential Acquisition proceeds and if the distribution agreements were not renewed upon their expiration in September, 2000 and December, 2000 respectively by Saab Automobile AB, then it would be difficult for the Company to follow the “Future Intentions” of augmenting the Group’s car distributing business using the Internet as an additional distribution channel as disclosed in the circular dated 20th April, 2000 due to changes in the business circumstances which are outside the control of the Company or its Directors.

Irrespective of the outcome of the Potential Acquisition or the renewal of the car distribution rights, it is the intention of the Group that it will expand its Internet business under the “www.renren.com” domain name which the Company commenced operating around May, 2000 pursuant to the amended and restated co-operation agreement dated 4th April, 2000 and entered into between Ankor Group Limited (the former name of the Company) and renren.com Holdings Limited. The website entitled “http://www.renren.com” aggregates and acquires Internet content, community applications and e-commerce services throughout Greater China to build vertical channels under the “www.renren.com” domain name. The Company operates the bilingual destination website “www.renren.com” and provides a suite of corporate services for multinational and pan-Asia clients, including online advertising and e-solutions; online recruitment through the specialized “job.renren.com” channel; and lead generation via the comparison shopping channel “shop.renren.com”.

General

The Company also noted the recent increases in the price and trading volume of the shares of the Company and wishes to state that, save as disclosed in this announcement and the announcement dated 24th July, 2000, the Company is not aware of any reasons for such increases.

No terms (which include but not limited to the consideration of the Potential Acquisition) have been finalised and discussions are still ongoing between the respective Parties.

If the Potential Acquisition proceeds, based on the audited figures of the Company as of 31st December, 1999, it may constitute a major transaction under Chapter 14 of the Listing Rules which will require approval by the shareholders of the Company and a circular regarding the major transaction will be required to be dispatched to the shareholders of the Company pursuant to the Listing Rules.

As the Potential Acquisition may or may not take place, shareholders of the Company and public investors are advised to exercise caution when dealing in the shares of the Company. The Directors will keep the market informed as and when any terms concerning the Potential Acquisition have been agreed or any agreement has been signed in accordance with the Listing Rules.

The Company also confirms that, save as described in this announcement and the announcement dated 24th July, 2000, there are no negotiations or agreements relating to intended acquisitions or realisations which are discloseable under Chapter 14 of the Listing Rules, nor is the Board aware of any matter discloseable under the general obligations imposed by paragraph 2 of the Listing Agreement, which is or may be of a price sensitive nature.

For and on behalf of the Board of the Company
Anthony Shih-Wei ChengDeputy ChairmanHong Kong, 9th August, 2000

Definition

“ASL”	Ankor Service Ltd. a wholly-owned subsidiary of the Company and a company incorporated in Hong Kong on 25th September, 1987;
“Aftersales Service Business”	the business of the provision of aftersales service by ASL for Opel and Cadillac vehicles in Hong Kong and Saab vehicles in Hong Kong, Macau and mainland China, including repair and maintenance services of motor vehicles and the sale of spare parts.
“Company”	renren Media Limited (formerly named Ankor Group Limited), a company incorporated in Bermuda with limited liability and the shares of which are listed on the Stock Exchange;
“Directors”	directors of the Company;
“GMA”	General Motors Asia, Inc., a corporation organized and existing under the laws of the State of Delaware, the United States of America;
“Listing Rules”	Rules Governing the Listing of Securities on the Stock Exchange;
“MOU”	a non-binding memorandum of understanding entered into between ASL and GMA on 8th August, 2000;
“Party” or “Parties”	GMA and ASL are each a “Party” and collectively the “Parties” to the MOU;
“Potential Acquisition”	potential offer to be made by GMA to acquire from the Company the legal and beneficial interest, either in its entirety or in part, in the issued share capital of ASL;
“Group”	renren Media Limited and its subsidiaries including ASL; and
“Stock Exchange”	The Stock Exchange of Hong Kong Limited.