THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect about this circular or as to the action to be taken, you should consult your licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Parkson Retail Group Limited, you should at once hand this circular form to the purchaser(s) or transferee(s) or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or the transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.

PARKSON RETAIL GROUP LIMITED 百盛商業集團有限公司

(Incorporated in Cayman Islands with limited liability)

(Stock code: 03368 & 05936)

VERY SUBSTANTIAL DISPOSAL:

DISPOSAL OF THE ENTIRE EQUITY INTERESTS IN BEIJING HUADESHENG PROPERTY MANAGEMENT CO., LTD (北京華德盛物業管理有限公司), A WHOLLY-OWNED PRC SUBSIDIARY, AND THE RELEVANT SHAREHOLDER’S LOAN

Capitalised terms used in this cover page shall have the same meanings as those defined in this circular.

A letter from the Board is set out on pages 7 to 26 of this circular. A notice convening the EGM to be held at Lavender, Level 3, Three Pacific Place, 1 Queen’s Road East, Admiralty, Hong Kong on Thursday, 17 November 2016 at 3:00 p.m. is set out on pages EGM-1 to EGM-2 of this circular. A form of proxy for the EGM is enclosed with this circular. Whether or not you intend to attend the EGM, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return the same to the branch share registrar and transfer office of the Company in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for the EGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM if you so wish.

For identification purpose only

1 November 2016

CONTENTS

			Page
DEFINITIONS. . . .		. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM	THE BOARD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		7
APPENDIX I	–	Financial Information of the Group . . . . . . . . . . . . . . . . . .	I-1
APPENDIX II	–	Management Discussion and Analysis on the
		Remaining Group. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	II-1
APPENDIX III	–	Financial Information of the Disposal Company . . . . . . . .	III-1
APPENDIX IV	–	Unaudited Pro forma Financial Information on
		the Remaining Group. . . . . . . . . . . . . . . . . . . . . . . . . . . .	IV-1
APPENDIX V	–	Valuation Report on the Disposal Property . . . . . . . . . . . .	V-1
APPENDIX VI	–	General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	VI-1
EGM Notice . . . . . .		. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

– i –

DEFINITIONS

In this circular, unless the context otherwise requires, the following terms have the following meaning:

“Advanced Rental”

means the advanced rental of approximately RMB354,166,666 in respect of the period from 1 August 2016 to 31 August 2023 which had been paid by the Vendor to the Disposal Company pursuant to the Previous Tenancy Agreements;

“Advanced Rental Taxes”
means the business taxes and other relevant taxes and surcharges of approximately RMB19,500,000 in respect of the Advanced Rental which had been paid by the Disposal Company to the relevant PRC governmental authorities;
“Board”

means the board of Directors;

“Company”

means Parkson Retail Group Limited, a company incorporated in the Cayman Islands;

“Directors”
means the directors of the Company;
“Disposal”
means the proposed disposals of the Sale Equity and the Sale Loan as contemplated by the Equity Transfer Agreement and the Loan Transfer Agreement;
“Disposal Company”

means Beijing Huadesheng Property Management Co., Ltd.* (北京華德盛物業管理有限公司), a company established in the PRC and an indirect wholly-owned subsidiary of the Company;

“Disposal Property”

means the building named Beijing Sun Palace Parkson* (北京太陽宮百盛) located at Building No. 1, Compound No. 12, Qi Sheng Middle Street, North-East of 3rd Ring Road, Chaoyang District, Beijing, the PRC (北京市朝陽區東北三環七聖中街12號院1號樓);

“East Crest”
means East Crest International Limited, a company incorporated in the British Virgin Islands;
“EFA”

means the equity transfer framework agreement in relation to (i) the transfer of the Sale Equity and (ii) the entry into of the LFA dated 13 September 2016 and entered into among the Parties;

– 1 –

DEFINITIONS

“EGM”

means the extraordinary general meeting of the Company to be convened for the Shareholders to consider and, if thought fit, approve the Transactions;
“Equity Completion”

means completion of the Equity Transfer Agreement;

“Equity Condition(s)”
means the conditions precedent for the Equity Completion;
“Equity Consideration A” means the consideration in the amount of RMB1,670,258,898.36, which forms part of the consideration payable by the Purchasers for the transfer of the Sale Equity;
“Equity Consideration B” means the aggregate amount of the cash and the bank balance as shown in the accounts of the Disposal Company as at the Handover Completion Date, which forms part of the consideration payable by the Purchasers for the transfer of the Sale Equity;
“Equity Consideration C”
means an amount equivalent to the Post Issuance Date Refunded Taxes, which forms part of the consideration payable by the Purchasers for the transfer of the Sale Equity;
“Equity Escrow Account”
means the bank account opened in the name of the Vendor and jointly controlled by the Vendor and Purchaser A for the purpose of holding the Total Equity Consideration or any part thereof;
“Equity Transfer Agreement”
means the formal agreement in relation to the transfer of the Sale Equity dated 13 October 2016 and entered into among the Parties;
“First Announcement”
means the announcement of the Company in relation to the EFA and the LFA dated 13 September 2016;
“Group”

means the Company and its subsidiaries;

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DEFINITIONS

“Handover Completion Date”
means the date on which vacation and handover of the Disposal Property has completed and the confirmation in relation to the handover of the Disposal Company and the Disposal Property has been signed by the Vendor and the Purchasers, which date shall be the latter of (i) on or before 15 December 2016 and (ii) the 10th working day after the fulfilment of the Equity Conditions;
“Hong Kong” means the Hong Kong Special Administrative Region of the PRC;
“Issuance Date” means the date on which registration of the transfer of the Sale Equity is completed and the new business licence of the Disposal Company is issued;
“LFA”
means the loan transfer framework agreement in relation to the transfer of the Sale Loan dated 13 September 2016 and entered into among the Vendor, the Company, Purchaser A, the Purchasers Parent and the Disposal Company;
“Listing Rules” means the Rules Governing the Listing of Securities on the Stock Exchange;
“Loan Completion”
means completion of the Loan Transfer Agreement;
“Loan Condition(s)”
means the conditions precedent for the Loan Completion;
“Loan Consideration”
means the consideration in the amount of RMB649,741,101.64 payable by Purchaser A for the transfer of the Sale Loan;
“Loan Deposit”
means the deposit in the amount of RMB65,000,000 payable by Purchaser A to the Vendor pursuant to the LFA;
“Loan Escrow Account”
means the bank account opened in the name of the Vendor and jointly controlled by the Vendor and Purchaser A for the purpose of holding the Loan Consideration;
“Loan Transfer Agreement”
means the formal agreement in relation to the transfer of the Sale Loan dated 13 October 2016 and entered into among the Vendor, the Company, Purchaser A and the Purchasers Parent;

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DEFINITIONS

“Long Stop Date”
means the date which is the 60th calendar day from the first calendar day immediately after the date of signing of the Equity Transfer Agreement (or such other date as the Vendor and the Purchasers may agree in writing);
“LPD” or “Latest Practicable Date”
means 27 September 2016, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained in this circular;
“Majority Shareholders” means East Crest and PRG;
“Parties”
means the Vendor, the Company, Purchaser A, Purchaser B and the Purchasers Parent;
“Post Issuance Date Refunded means the Refunded Taxes received by the Disposal Taxes” Company after the Issuance Date (if any);
“PRC”
means the People’s Republic of China and, for the purposes of this announcement only, excludes Hong Kong, Macau Special Administrative Region and Taiwan;
“Previous Tenancy Agreements”
means the tenancy agreement in respect of the Disposal Property between the Disposal Company as landlord and the Vendor as tenant together with the relevant agreement in relation to the advanced rental payment which had been terminated on 31 July 2016;
“PRG”
means PRG Corporation Limited, a company incorporated in the British Virgin Islands;
“Purchaser A” means Shenzhen Qianhai Tulan Investment Centre (LLP)* (深圳前海圖藍投資中心(有限合夥));
“Purchaser B”
means Shanghai Changkun Investment Management Co. Ltd.* (上海長昆投資管理有限公司);
“Purchasers” means Purchaser A and Purchaser B;
“Purchasers Parent” means ZRiver Capital Investment Management Limited* (中融長河資本投資管理有限公司), the ultimate parent company of the Purchasers;

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DEFINITIONS

“Refunded Taxes” means (subject to the cap amount of RMB19,500,000) the Advanced Rental Taxes (or any part thereof) refunded by the PRC governmental authorities to the Disposal Company pursuant to the Tax Refund Application, if any;
“Remaining Group”
means the Group immediately after completion of the Disposal;
“RMB”
means Renminbi, the lawful currency of the PRC;
“Sale Equity”
“Sale Loan”
means the entire equity interests of the Disposal Company; means the shareholder’s loan and other monies in the aggregate amount of RMB649,741,101.64 as at 31 July 2016 owed or otherwise payable by the Disposal Company to the Vendor and its related parties after deduction of the monies payable by the Vendor to the Disposal Company;
“Second Announcement” means the announcement of the Company in relation to the Equity Transfer Agreement and the Loan Transfer Agreement dated 13 October 2016;
“SFO”
means the Securities and Futures Ordinance, Cap. 571 of the Laws of Hong Kong;
“Shareholders” means holders of the Shares;
“Shares”
means shares of nominal value of HK$0.02 each in the capital of the Company;
“Stock Exchange”
means The Stock Exchange of Hong Kong Limited;
“Tax Refund Application”
means the application for the refund of the Advanced Rental Taxes to be made by the Disposal Company to the relevant PRC governmental authorities;
“Total Equity Consideration”
means the aggregate of Equity Consideration A, Equity Consideration B and Equity Consideration C;
“Transactions”
means the Disposal and the transactions contemplated by or incidental to the Disposal;

– 5 –

DEFINITIONS

“Vendor” means Parkson Retail Development Co., Ltd.* (百盛商業發展有限公司), a company established in the PRC and an indirect wholly-owned subsidiary of the Company; and “%” means percentage.

For ease of reference, the names of the PRC established companies or entities and the PRC laws and regulations have generally been included in this circular in both Chinese and English languages and in the event of inconsistency, the Chinese language shall prevail.

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LETTER FROM THE BOARD

PARKSON RETAIL GROUP LIMITED 百盛商業集團有限公司

(Incorporated in Cayman Islands with limited liability)

(Stock code: 03368 & 05936)

Registered office:

Executive Directors: Registered office: Tan Sri Cheng Heng Jem c/o M&C Corporate Services Limited Mr. Chong Sui Hiong P.O. Box 309 Ms. Juliana Cheng San San Ugland House South Church Street Non-Executive Director: George Town Dato’ Dr. Hou Kok Chung Grand Cayman Cayman Islands

Independent Non-Executive Directors:

Dato’ Fu Ah Kiow Mr. Ko Tak Fai, Desmond Mr. Yau Ming Kim, Robert

Principal place of business in Hong Kong: Room 609, 6th Floor Harcourt House 39 Gloucester Road Wanchai, Hong Kong

1 November 2016

To the Shareholders

Dear Sir or Madam,

VERY SUBSTANTIAL DISPOSAL:

DISPOSAL OF THE ENTIRE EQUITY INTERESTS IN BEIJING HUADESHENG PROPERTY MANAGEMENT CO., LTD (北京華德盛物業管理有限公司), A WHOLLY-OWNED PRC SUBSIDIARY AND THE RELEVANT SHAREHOLDER’S LOAN

1. INTRODUCTION

Reference is made to (a) the First Announcement, pursuant to which it was announced, among other things, that the EFA an the LFA were entered into and (b) the Second Announcement, pursuant to which it was announced, among other things, that (i) the Equity Transfer Agreement was entered into and, as a result, the EFA was terminated and (ii) the Loan Transfer Agreement was entered into and, as a result, the LFA was terminated.

The purpose of this circular is to provide you with, among other things, further details of the Disposal, other information required under the Listing Rules and a notice of the EGM.

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LETTER FROM THE BOARD

2. THE EQUITY TRANSFER AGREEMENT

The principal terms of the Equity Transfer Agreement are summarised below:

(a) Date

13 October 2016.

(b) Parties

The Vendor, the Company, the Purchasers and the Purchasers Parent.

To the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, each of Purchaser A, Purchaser B and the Purchasers Parent and its ultimate beneficial owners are third parties independent of, and not connected with, the Company and its connected persons (as defined under the Listing Rules).

(c) Assets to be disposed of

The Sale Equity, of which Purchaser A shall acquire 99.99999999% and Purchaser B shall acquire 0.00000001%.

(d) Total Equity Consideration and basis of its determination

(i) The Total Equity Consideration

The Total Equity Consideration, which is payable in cash, comprises:

(A) Equity Consideration A in the amount of RMB1,670,258,898.36;
(B) Equity Consideration B; and
(C) Equity Consideration C.

The Total Equity Consideration was determined after arm’s length negotiations between the Vendor and the Purchasers with reference to (I) the unaudited net asset value of the Disposal Company as at 31 July 2016; (II) the prevailing market price of the properties comparable with the Disposal Property in size, age, usage and location; (III) the cash and bank balance that the Disposal Company may have as at the Handover Completion Date; and (IV) the Refunded Taxes that the Disposal Company may receive after the Issuance Date.

As at 31 August 2016, the cash and bank balance of the Disposal Company was approximately RMB769,850.46.

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LETTER FROM THE BOARD

(ii) Further information on the Refunded Taxes

The Disposal Property, which is owned by the Disposal Company solely, was previously subject to the Previous Tenancy Agreements. The Advanced Rental Taxes had been paid by the Disposal Company to the relevant PRC governmental authorities as a result of the payment of the Advanced Rental. Since the Previous Tenancy Agreements had been terminated on 31 July 2016, the Disposal Company has already approached the relevant PRC governmental authorities for the refund of the business taxes and other relevant taxes and surcharges in relation to the Advanced Rental paid for the remaining tenancy period under the Previous Tenancy Agreements i.e. the period from 1 August 2016 to 31 August 2023.

Assuming that the Tax Refund Application will be approved by the relevant PRC governmental authorities, it is expected that the maximum amount of the Refunded Taxes would be equivalent to the amount of the Advanced Rental Taxes (i.e. approximately RMB19,500,000).

There is no guarantee that the Tax Refund Application will be approved by the relevant PRC governmental authorities and even if the Tax Refund Application is approved by the relevant PRC governmental authorities, there is no guarantee that the amount of the Refunded Taxes actually received by the Disposal Company will be equivalent to the expected maximum amount of the Refunded Taxes disclosed above.

(e) Equity Deposit

The Purchasers has already paid a deposit (the “ Equity Deposit ”) in the amount of RMB167,000,000, representing approximately 10% of Equity Consideration A, into the Equity Escrow Account in accordance with the EFA. The Equity Deposit formed part of the first instalment of Equity Consideration A as described in the subsection headed “(f) – Payment schedule of the Total Equity Consideration – (i) Payments to the Equity Escrow Account” below.

(f) Payment schedule of the Total Equity Consideration

(i) Payments to the Equity Escrow Account

Equity Consideration A shall be paid by the Purchasers into the Equity Escrow Account in three instalments, the details of which are summarised below:

	Portions of Equity
Instalments	Consideration A			Timeline
First instalment	20%	Within five working days				after the
(“First Equity	(i.e. RMB334,051,779.68)	signing	of	the	Equity	Transfer
Consideration		Agreement
Instalment”)

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LETTER FROM THE BOARD

Portions of Equity Instalments Consideration A Timeline Second instalment 40% (Subject to the fulfilment or waiver of (“ Second Equity (i.e. RMB668,103,559.34) the Equity Conditions) Within five Consideration working days after the electronic Instalment ”) platform of the relevant branch of the Administration for Industry and Commerce has confirmed acceptance of the documents regarding the changes in, among other things, the shareholders and the legal representative of the Disposal Company, but before the submission of the documents regarding the above changes at the office of the relevant branch of the Administration for Industry and Commerce Third instalment 40% Within five working days after the (“ Third Equity (i.e. RMB668,103,559.34) relevant branch of the Consideration Administration for Industry and Instalment ”) Commerce has issued a notice on acceptance of the documents regarding, among other things, changes in the shareholders and the legal representative of the Disposal Company

The First Equity Consideration Instalment had already been paid into the Equity Escrow Account in accordance with the Equity Transfer Agreement.

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LETTER FROM THE BOARD

(ii) Release of monies from the Equity Escrow Account to the bank account designated by the Vendor

The monies maintained in the Equity Escrow Account and Equity Consideration B shall be transferred to the bank account designated by the Vendor in two instalments, the details of which are summarised below: Portions of the monies maintained in the Equity Escrow Account and other Payments consideration (if any) Timeline

First payment 90% of the monies Within five working days after (i) (“ First Released maintained in the Equity registration of the transfer of the Equity Escrow Account Sale Equity has been completed Consideration ”) and the new business licence of the Disposal Company has been issued and (ii) filings regarding changes in the directors, supervisors and senior management, all being persons appointed or recommended by the Purchasers, having been completed
Second payment • 10% of the monies Within five working days after (i) (“ Second Released maintained in the the Disposal Property has been Equity Equity Escrow Account vacated and delivered to the Consideration ”) Purchasers and (ii) the Vendor • Equity Consideration B and the Purchasers have signed a confirmation in this regard

(iii) Payments of Equity Consideration C

If the Disposal Company shall receive any Post Issuance Date Refunded Taxes, the Purchasers shall pay an amount equivalent to such Post Issuance Date Refunded Taxes to the Vendor within five working days after the receipt of the Post Issuance Date Refunded Taxes by the Disposal Company.

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LETTER FROM THE BOARD

(g) Equity Conditions

The Equity Completion is subject to the fulfilment of the Equity Conditions on or before the Long Stop Date. Set out below is a summary of the Equity Conditions:

(i) the shareholders’ resolution(s) of the Company for the approval of the transfers of the Sale Equity and the Sale Loan having been passed and the announcement, the contents of which being subject to the consent of the Purchasers, regarding such resolution(s) having been published at the website of the Stock Exchange or the Company (the “ Approval Condition ”);
(ii) there being no breach of the Equity Transfer Agreement by the Vendor (the “ No Breach by Vendor Condition ”);
(iii) there being no breach of the Equity Transfer Agreement by the Purchasers (the “ No Breach by Purchasers Condition ”); and
(iv) the Loan Condition as set out in paragraph (i) of the subsection headed “3. The Loan Transfer Agreement – (g) Loan Conditions” below having been fulfilled (the “ Loan Condition (I) ”).

(h) Fulfilment (or waiver) of the Equity Conditions and consequences if the Equity Conditions are not fulfilled (or waived)

The table below summarises the information on whether the Equity Conditions can be waived:

Equity Conditions		Whether it can be waived
Approval Condition	:	Cannot be waived
No Breach by Vendor Condition	:	Can be waived by the Purchasers
No Breach by Purchasers Condition	:	Can be waived by the Vendor
Loan Condition (I)	:	Cannot be waived

As at the LPD, none of the Equity Conditions has been fulfilled or waived.

Set out below is a summary on the consequences if the relevant Equity Condition are not fulfilled (or waived, if applicable) on or before the Long Stop Date:

(i) Approval Condition

The Equity Transfer Agreement shall be terminated and the Vendor shall pay an amount equivalent to 200% of both the Equity Deposit and the Loan Deposit (the “ Prescribed Compensation ”) to the Purchasers together with other monies paid by the Purchasers within five working days after the termination of the Equity Transfer Agreement.

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LETTER FROM THE BOARD

To safeguard the Company from having to pay the Prescribed Compensation by virtue of the failure to obtain the Shareholders’ approval of the Transactions, the Company has obtained an undertaking letter dated 13 September 2016 from the Majority Shareholders, who owned an aggregate of 1,448,270,000 Shares according to the information available to the public, representing approximately 54.67% of the issued Shares as at the LPD, pursuant to which the Majority Shareholders irrevocably and unconditionally undertook to the Company, among other things, that their aggregate shareholding in the Company will not be less than the majority of the issued capital of the Company from the date of the undertaking letter up to and including the date on which the EGM is held and they will vote all the Shares owned by them to approve the Transactions at the EGM. On the basis of the said undertaking letter and since (x) the terms of the Transactions are fair and reasonable as a whole and therefore the Directors are confident that the Transactions would be supported by the Shareholders; and (y) there is no reason to suspect that the Parties cannot agree on the poll results announcement as at the LPD, the Directors are of the view that there is no real risk that the Approval Condition cannot be satisfied. The Directors are also of the opinion that (A) the Prescribed Compensation is a fair and reasonable term and in the interest of the Company and the Shareholders as whole and (B) would not deter the Shareholders to freely consider and exercise their voting rights.

(ii) No Breach by Vendor Condition

If the Vendor’s breach relates to a breach of certain specified Vendor’s warranties and the Vendor has not remedied the breach(es) within the reasonable period as requested by the Purchasers, the consequence shall be the same as in the case of the Approval Condition being unfulfilled. In addition, the Vendor shall bear the relevant costs for remedying the breach(es). The aforesaid specified Vendor’s warranties (the “ Specified Vendor’s Warranties ”) are summarised as follows: (A) the approval of the board of directors of the Company of the Transactions had been obtained prior to the signing of the Equity Transfer Agreement; (B) all the information and documents provided to the Purchasers are true and complete; (C) the Vendor holds 100% of the equity interests of the Disposal Company free from encumbrances; (D) the Disposal Company shall be the sole owner of the Disposal Property from the date of signing of the Equity Transfer Agreement up to the Issuance Date; (E) prior to the Issuance Date, the Vendor shall coordinate with the Purchasers in relation to completing the application to the taxation authorities by the Disposal Company with regard to the simplified collection of the value-added taxes on the future leasing income of the Disposal Property (except that if the failure to complete the application is caused by the taxation authorities, the Vendor shall not be considered as having breached this warranty); and (F) compliance of the relevant requirements on anti-corruption and anti-bribery by the Vendor. In the case of breach(es) of other Vendor’s warranties, the Vendor should remedy the breach(es) within the reasonable period as requested by the Purchasers and bear the relevant costs, but the Purchasers shall not be entitled to terminate the Equity Transfer Agreement.

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LETTER FROM THE BOARD

(iii) No Breach by Purchasers Condition

If the Purchasers’ breach relates to a breach of certain specified Purchasers’ warranties and the Purchasers have not remedied the breach(es) within the reasonable period as requested by the Vendor, the consequence shall be: (A) the Equity Transfer Agreement shall be terminated; (B) the Vendor shall be entitled to forfeit both the Equity Deposit and the Loan Deposit and (C) the Vendor shall return to the Purchasers other monies paid by the Purchasers other than the Equity Deposit and the Loan Deposit. In addition, the Purchasers shall bear the relevant costs for remedying the breach(es). The aforesaid specified Purchasers’ warranties (the “ Specified Purchasers’ Warranties ”) are summarised as follows: (I) the Purchasers have obtained all necessary approvals prior to the signing the Equity Transfer Agreement; (II) all the documents provided to the Vendor are true and complete; (III) the funds to be paid to the Vendor as consideration for the purchase of the Sale Equity are from legal source; and (IV) compliance of the relevant requirements on anti-corruption and anti-bribery by the Purchasers. In the case of breach(es) of other Purchasers warranties, the Purchasers should remedy the breach(es) within the reasonable period as requested by the Vendor and bear the relevant costs, but the Vendor shall not be entitled to terminate the Equity Transfer Agreement.

(iv) Loan Condition (I)

Loan Condition (I) is equivalent to the Approval Condition. Accordingly, the consequence sets out in paragraph (i) above applies. Additionally, the Loan Transfer Agreement shall be terminated.

(i) Equity Completion

Subject to the fulfilment (or waiver, if applicable) of the Equity Conditions, the Equity Completion shall take place after registration of the transfer of the Sale Equity at the relevant branch of the Administration of Industry and Commerce has occurred and the provisions of the Equity Transfer Agreement governing the payment and release of Equity Consideration A and Equity Consideration B have been performed.

The Equity Completion and the Loan Completion are inter-conditional. If the Equity Completion does not take place concurrently with the Loan Completion, neither the Vendor nor the Purchasers shall be obliged to proceed with the Equity Completion. The Loan Transfer Agreement contains provisions governing completion which are similar to the Equity Transfer Agreement under which the transfer of the Sale Loan will not be considered as having been completed until the provisions of the Loan Transfer Agreement governing the payment and release of the Loan Consideration have been performed. As demonstrated by the payment schedules set out in the subsections headed “2. The Equity Transfer Agreement – (f) Payment schedule of the Total Equity Consideration” above and “3. The Loan Transfer Agreement – (f) Payment schedule of the Loan Consideration” below, the release of the balance of the monies in the Equity Escrow Account and the Loan Escrow Account will occur concurrently. Accordingly, if the provisions governing the payment and release of (i) the relevant parts of the

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LETTER FROM THE BOARD

Total Equity Consideration under the Equity Transfer Agreement and (ii) the Loan Consideration under the Loan Transfer Agreement are observed, the Equity Completion and the Loan Completion will occur concurrently.

(j) The Loan Transfer Agreement

The Vendor and the Purchasers shall, concurrently with the signing of the Equity Transfer Agreement, enter into the Loan Transfer Agreement.

(k) Representations and warranties

In addition to the Specified Vendor’s Warranties, the Vendor has given representations and warranties which are customary in transactions of similar nature, such as (i) it has the authority to perform the Equity Transfer Agreement; (ii) as at the date of the Equity Transfer Agreement, the Disposal Company has paid taxes in accordance with the requirements of the national and local taxation authorities; and (iii) the registered capital of the Disposal Company in the amount of RMB400,000,000 had been fully paid up.

In addition to the Specified Purchasers’ Warranties, the Purchasers have given representations and warranties which are customary in transactions of similar nature, such as (i) they have the authorities to perform the Equity Transfer Agreement; and (ii) they shall perform their obligations strictly in accordance with the Equity Transfer Agreement.

(l) Detailed terms and handover of the Disposal Property

The Equity Transfer Agreement sets out (i) the documents, information and other items in relation to the Disposal Property which the Vendor shall deliver to the Purchasers, such as the Disposal Property and the assets attached thereto, the building ownership certificates and the state-owned land use rights certificates; and (ii) the factors for determination of whether the handover of the Disposal Property has been satisfied.

(m) Guarantees on performance of the transaction documents

The Company guarantees the Vendor’s performance of the Equity Transfer Agreement and the Loan Transfer Agreement. Similarly, the Purchasers Parent guarantees the Purchasers’ performance of the Equity Transfer Agreement and the Loan Transfer Agreement.

(n) Exercise of the rights, and performance of the obligations, of the Purchasers by Purchaser A

The Purchasers’ rights shall be exercised, and the Purchasers’ obligations shall be performed, by Purchaser A.

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LETTER FROM THE BOARD

(o) Default

The Equity Transfer Agreement contains provisions specifying the remedies in case of certain defaults. For example, if the Vendor defaults in payment of monies payable by it under the Equity Transfer Agreement, such as returning the Equity Deposit and/or the Loan Deposit to the Purchasers, the Vendor is obliged to pay an additional amount equivalent to 0.03% of the amount it is otherwise obliged to pay for each day during the continuance of the default. If the Vendor has failed to perform its payment obligations and the Company has received the Purchasers’ notice requesting the Company to perform such Vendor’s obligations but the Company has failed to do so, the Company will also be subject to the provision requiring payment of an additional amount equivalent to 0.03% of the amount it is otherwise obliged to pay during the continuance of the default. The Purchaser and the Purchasers Parent are subject to similar provisions in relation to the Company as disclosed in the preceding statements of this paragraph in relation to, among other things, payments of the deposits and consideration pursuant to the Equity Transfer Agreement and/or the Loan Transfer Agreement.

3. THE LOAN TRANSFER AGREEMENT

The principal terms of the Loan Transfer Agreement are summarised below:

(a) Date

13 October 2016.

(b) Parties

The Vendor, the Company, Purchaser A, Purchasers Parent and the Disposal Company.

(c) Assets to be disposed of

The Sale Loan.

(d) The Loan Consideration and basis of its determination

The Loan Consideration in the amount of RMB649,741,101.64 was determined after arm’s length negotiations between the Vendor and the Purchasers with reference to the unaudited carrying value of the Sale Loan as at 31 July 2016.

(e) Loan Deposit

Purchaser A had already paid the Loan Deposit in the amount of RMB65,000,000 into the Loan Escrow Account in accordance with the LFA. The Loan Deposit formed part of the first instalment of the Loan Consideration as described in the subsection headed “(f) – Payment schedule of the Loan Consideration – (i) Payments to the Loan Escrow Account” below.

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LETTER FROM THE BOARD

(f) Payment schedule of the Loan Consideration

(i) Payments to the Loan Escrow Account

The Loan Consideration shall be paid by Purchaser A into the Loan Escrow Account in three instalments, the details of which are summarised below:

	Portions of the
Instalments	Loan Consideration	Timeline
First instalment	20%	Concurrently with the payment
	(i.e. RMB129,948,220.32)	of the First Equity
		Consideration Instalment
Second instalment	40%	Concurrently with the payment
	(i.e. RMB259,896,440.66)	of the Second Equity
		Consideration Instalment
Third instalment	40%	Concurrently with the payment
	(i.e. RMB259,896,440.66)	of the Third Equity
		Consideration Instalment

The first instalment of the Loan Consideration had already been paid into the Loan Escrow Account in accordance with the Loan Transfer Agreement.

(ii) Release of monies from the Loan Escrow Account to the bank account designated by the Vendor

The monies maintained in the Loan Escrow Account shall be transferred to the bank account designated by the Vendor in two instalments, the details of which are summarised below:

	Portions	of the monies
	maintained in the
Payments	Loan Escrow Account		Timeline
First payment		90%	Concurrently with the release
			of the First Released Equity
			Consideration
Second payment		10%	Concurrently with the release
			of the Second Released
			Equity Consideration

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LETTER FROM THE BOARD

(g) Loan Conditions

The Loan Completion is subject to the fulfilment of the Loan Conditions on or before the Long Stop Date. A summary of the Loan Conditions is set out below:

(i) the Approval Condition (“ Loan Condition (I) ”); and
(ii) the Approval Condition, the Vendor No Breach Condition and the Purchasers No Breach Condition having been fulfilled (or waived, if applicable) (“ Loan Condition (II) ”).

(h) Fulfilment (or waiver) of the Loan Conditions and consequences if the Loan Conditions are not fulfilled (or waived)

The table below summarises the information on whether the Loan Conditions can be waived:

Loan Conditions Whether it can be waived Loan Condition (I) : Cannot be waived Loan Condition (II) : As summarised in the table depicted in the subsection headed “2. The Equity Transfer Agreement – (h) Fulfilment (or waiver) of the Equity Conditions and consequences if the Equity Conditions are not fulfilled (or waived)” above

As at the LPD, none of the Loan Conditions has been fulfilled or waived.

Set out below is summary on the consequences if the relevant Loan Condition are not fulfilled (or waived, if applicable) on or before the Long Stop Date:

(i) Loan Condition (I)

Loan Condition (I) is equivalent to the Approval Condition. Accordingly, the consequence sets out in paragraph (i) of the subsection headed “2. The Equity Transfer Agreement – (h) Fulfilment (or waiver) of the Equity Conditions and consequences if the Equity Conditions are not fulfilled (or waived)” above applies. Additionally, the Loan Transfer Agreement shall be terminated.

(ii) Loan Condition (II)

As summarised in paragraphs (i), (ii) and (iii) in the subsection headed “2. The Equity Transfer Agreement – (h) Fulfilment (or waiver) of the Equity Conditions and consequences if the Equity Conditions are not fulfilled (or waived)” above.

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LETTER FROM THE BOARD

(i) Loan Completion

The Loan Completion is subject to the fulfilment (or waiver, if applicable) of the Loan Conditions. The Loan Transfer Agreement contains provisions governing completion which are similar to those of the Equity Transfer Agreement as disclosed in the subsection headed “2. The Equity Transfer Agreement – (i) Equity Completion”. Those similar provisions under the Loan Transfer Agreement are:

(i) the transactions under the Loan Transfer Agreement will not be considered as having been completed until the provisions of the Loan Transfer Agreement governing the payment and release of the Loan Consideration have been performed; and
(ii) if the Loan Completion does not take place concurrently with the Equity Completion, neither the Vendor nor Purchaser A shall be obliged to proceed with the Loan Completion.

As contemplated by paragraph (ii) above, the Equity Completion and the Loan Completion are inter-conditional.

As disclosed in the subsection headed “2. The Equity Transfer Agreement – (i) Equity Completion” above, if the provisions governing the payment and release of (i) the relevant parts of the Total Equity Consideration under the Equity Transfer Agreement and (ii) the Loan Consideration under the Loan Transfer Agreement are observed, the Equity Completion and the Loan Completion will occur concurrently.

(j) Termination of the Loan Transfer Agreement

If the Equity Transfer Agreement shall be terminated or otherwise becomes void, the Loan Transfer Agreement will also be terminated or becomes void automatically.

(k) Guarantees on performance of the transaction documents

The Company guarantees the Vendor’s performance of the Equity Transfer Agreement and the Loan Transfer Agreement. Similarly, the Purchasers Parent guarantees Purchasers A’s performance of the Equity Transfer Agreement and the Loan Transfer Agreement.

(l) Default

The Loan Transfer Agreement contains provisions specifying the remedies in case of certain defaults. For example, if the Vendor has failed to perform its payment obligations under the Equity Transfer Agreement and/or the Loan Transfer Agreement to return the Equity Deposit and/or the Loan Deposit to the Purchasers and the Company has received the Purchasers’ notice requesting the Company to perform such Vendor’s obligations but the Company has failed to do so, the Company is obliged to pay an additional amount equivalent to 0.03% of the amount it is otherwise obliged to pay for each day during the continuance of

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LETTER FROM THE BOARD

the default. The Purchasers Parent is subject to similar provisions in relation to the Company as disclosed in the preceding statements of this paragraph in relation to, among other things, payments of the deposits and consideration pursuant to the Equity Transfer Agreement and/or the Loan Transfer Agreement.

4. INFORMATION ON THE DISPOSAL COMPANY

The Disposal Company is a company established in the PRC, and an indirect whollyowned subsidiary of the Company, whose scope of business includes, among other things, property development and property management. The assets held by the Disposal Company consist mainly of the Disposal Property. Please refer to the section headed “5. Information on the Disposal Property” below for information on the Disposal Property. Save and except for the value of the Disposal Property, cash and bank balances, the Advanced Rental Taxes and the Sale Loan, the Disposal Company does not have any other major assets or liabilities as at the LPD.

The unaudited net assets value of the Sale Equity was RMB397,779,777 as at 31 August 2016.

Set out below is the unaudited financial information of the Disposal Company for the two years ended 31 December 2014 and 2015 respectively:

	Year ended	Year ended
	31 December	31 December
	2014	2015
	(RMB’000)	(RMB’000)
(Loss)/Profit before tax	(1,207)	1,781
(Loss)/Profit after tax	(1,207)	1,335
Net asset value attributable to the owners
of the parent	405,225	406,579

The financial information set out in the above table was prepared in accordance with the Accounting Standards for Business Enterprises as promulgated by the Ministry of Finance of the PRC. Financial information in respect of the same items as contained in the above table is also provided in Appendix III (Financial Information of the Disposal Company) to this circular which was prepared in accordance with a different accounting policy and standard, namely the International Financial Reporting Standards, due to the requirement of Rule 14.68(2)(a)(i)(A) of the Listing Rules.

Upon completion of the Disposal, the Vendor will cease to hold any equity interest in the Disposal Company and the Disposal Company will cease to be a subsidiary of the Company. Accordingly, completion of the Disposal will result in the deconsolidation of the assets and liabilities of the Disposal Company from the Group’s consolidated accounts.

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LETTER FROM THE BOARD

5. INFORMATION ON THE DISPOSAL PROPERTY

The Disposal Property is located in the Chaoyang District of Beijing and comprises of seven levels above ground for commercial use and three levels under ground which are principally used as car parking spaces. The unaudited net book value of the Disposal Property was RMB1,031,810,539.54 as at 31 July 2016. A valuation in relation to the Disposal Property is set out in Appendix V to this circular.

As at the LPD, the Disposal Property was being used by the Vendor for department store operation.

Under the Equity Transfer Agreement, the Vendor must have vacated the Disposal Property before the remaining 10% of the monies in the Equity Escrow Account can be released to the Vendor. A summary on the terms in relation to the vacation of the Disposal Property have been disclosed in the subsection headed “2. Equity Transfer Agreement – (l) Detailed terms and handover of the Disposal Property” above. To the best of the knowledge, information and belief of the Directors having made all reasonable enquiries, it is expected that the costs and expenses associated with the vacation of the Disposal Property will not have any material adverse impact on the financial position of the Group.

6. INFORMATION ON THE GROUP AND THE VENDOR

The principal activities of the Group are the operation and management of a network of department stores in the PRC. The Vendor is a company established in the PRC and an indirect wholly-owned subsidiary of the Company whose scope of business includes, among other things, operation of commercial retail and the operation of wholesale.

7. INFORMATION ON THE PURCHASERS AND THE PURCHASERS PARENT

Purchaser A is a limited liability partnership established in the PRC. The scope of business of Purchaser A includes, among other things, assets management, investments management (except for trust, financial assets management, securities assets management and other restricted areas), management of equity investment funds (except for securities investments).

Purchaser B is a company established in the PRC whose scope of business includes, among other things, investment management, asset management and investment consultancy, management consultancy.

The Purchasers Parent is a company established in the PRC whose scope of business is identical to that of Purchaser B. As at the LPD, the Purchasers Parent held 80% of the equity interest of Purchaser B which, in its capacity as the general partner of Purchaser A, controlled 100% of the voting rights in relation to all the affairs of Purchaser A.

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LETTER FROM THE BOARD

8. FURTHER INFORMATION ON DETERMINATION OF THE TOTAL CONSIDERATION AND GAIN EXPECTED TO ACCRUE TO THE GROUP

(a) Further information on determination of the Total Consideration

The Total Consideration comprises (i) the Equity Consideration and (ii) the Loan Consideration. The Directors consider that the amount of the Total Consideration is fair and reasonable and in the interests of the Company and the Shareholders as a whole after taking into account and balancing the factors set out below:

(i) the Equity Consideration was agreed and determined after arm’s length negotiations between the Vendor and the Purchasers on the bases as disclosed in the section headed “2. The Equity Transfer Agreement – (d) Total Equity Consideration and basis of its determination”;
(ii) Equity Consideration A in the amount of RMB1,670,258,898.36 represents a significant premium of approximately 316.04% over the unaudited net asset value of the Sale Equity in the amount of RMB401,467,246.79 as at 31 July 2016, and after balancing other factors for determining the Equity Consideration, the Directors are satisfied that the amount of the Equity Consideration is fair and reasonable;
(iii) with the assistance of the Company’s PRC property advisers, the Vendor had made reference to the prevailing prices of the properties comparable with Disposal Property in size, age, usage and location in Beijing, and after balancing other factors for determining the Equity Consideration, the Directors are satisfied that the amount of the Equity Consideration is fair and reasonable;
(iv) the Loan Consideration was determined after arm’s length negotiations between the Vendor and the Purchaser on the basis as disclosed in the section headed “3. The Loan Transfer Agreement – (d) The Loan Consideration and basis of its determination”, namely the unaudited carrying value of the Sale Loan in the amount of RMB649,741,101.64 as at 31 July 2016, such carrying value being equivalent to the Loan Consideration; and
(v) even only taking into account part of the Total Consideration (namely, Equity Consideration A and the Loan Consideration), an unaudited gain is expected to accrue to the Group as disclosed in the subsection headed “(b) Gain expected to accrue to the Group” below.

(b) Gain expected to accrue to the Group

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LETTER FROM THE BOARD

9. USE OF PROCEEDS FROM THE DISPOSAL

Without taking into account Equity Consideration B and Equity Consideration C and based on Equity Consideration A and the Loan Consideration in the aggregate amount of RMB2.32 billion but after the deduction of the currently estimated taxes, professional fees and other expenses attributable to the Disposal, the Company estimated that the net proceeds from the Disposal will be approximately RMB1.9 billion. As was disclosed in the section headed “Management Discussion and Analysis” of the interim report of the Company for the six months ended 30 June 2016 (the “ Interim Report ”), the Group will continue to enrich its products and services offerings through the expansion of its fashion and F&B brands and will look for new business investment opportunities to expand the Group’s revenue streams, and intends to apply the net proceeds from the Disposal for such purposes. As the principal activities of the Group are the operation and management of a network of department stores in the PRC, the Group will primarily look for new business investment opportunities in retail sector in the PRC although the Group would not exclude the possibility of looking for alternative investment targets should appropriate opportunities arise. As at the LPD, no appropriate new business opportunity has been identified yet nor has the Group identified business opportunities for the expansion of the Group’s fashion and F&B brands. Although the Group has not yet determined the allocation of the net proceeds from the Disposal for the uses disclosed above and the timeline thereof as at the LPD, the Group has been monitoring, and will continue to monitor, new business investment opportunities and business opportunities which can benefit the expansion of the Group’s fashion and F&B brands taking into account, among other things, the development of the Group, the retail sector as a whole and the macro-economic circumstances of the PRC and the world as a whole. As at the LPD, the Directors intended that after the identification of business opportunities for the said uses has made appropriate progress and more details in this regard (for example, costs, return, risk, exact investment targets) are available, decisions will be made as to, among other things, the allocation of the amounts of net proceeds, the timeline thereof and the manner through which the proceeds will be applied (i.e. by way of investment, acquisitions of targets to be identified, joint ventures, natural expansion of the existing operations, etc.). The Company will update the Shareholders on the Group’s plan on the use of proceeds and the actual use of proceeds in the Group’s coming financial report(s). To the extent that the net proceeds are not immediately used for the intended purposes described above, they will be placed in deposits with banks.

10. SIGNIFICANT FINANCIAL EFFECTS OF THE DISPOSAL ON THE GROUP

Assets and liabilities

Based on the pro forma financial information on the Remaining Group as set out in Appendix IV to this circular (the “ Pro Forma Financial Information ”), the pro forma consolidated assets of the Group as at 30 June 2016 would increase by approximately RMB1,258,658,000 to approximately RMB13,773,920,000 and the pro forma consolidated total liabilities of the Group as at 30 June 2016 would increase by approximately RMB336,356,000 to approximately RMB8,043,111,000 after the Disposal, assuming that completion of the Disposal had taken place on 30 June 2016.

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LETTER FROM THE BOARD

Earnings

For illustrative purpose only, assuming that the Disposal was completed on 1 January 2016, the Directors expect that the unaudited pro forma profits attributable to Shareholders for the six months period ended 30 June 2016 would increase by approximately RMB899,683,000 to approximately RMB775,476,000 and the basic and diluted earnings per share for the six months period ended 30 June 2016 will increase by approximately RMB0.340 per share to approximately RMB0.293 per share.

Gearing

As at 30 June 2016, the Group had total assets of approximately RMB12,515,262,000, total debt of approximately RMB4,014,265,000 and total equity of approximately RMB4,808,507,000. With reference to the Pro Forma Financial Information, assuming that the Disposal was completed on 30 June 2016, total assets would increase to approximately RMB13,773,920,000, the total debt would remain the same at RMB4,014,265,000 and the total equity would increase to approximately RMB5,730,809,000. As such, the Group’s gearing ratio (total debt/total assets) of 32.1% as at 30 June 2016 would decrease by approximately 3.0% to approximately 29.1%.

Based on the aggregated book value of the Sale Equity and the Sale Loan in the amount of RMB1,043,858,251 as at 30 September 2016, there is an excess of the aggregated amount of Equity Consideration A and the Loan Consideration (i.e. RMB2,320,000,000).

11. REASONS AND BENEFITS FOR ENTERING INTO THE TRANSACTIONS

Amid challenging operating environment, the department store operation located in the Disposal Property has been loss making since its opening in December 2010. Taking into consideration the estimated proceeds from the Disposal and the estimated unaudited gain from the Disposal (even without taking into account Equity Consideration B and Equity Consideration C), the Directors consider that the Disposal represents a good opportunity for the Group to unlock the value of the Disposal Company at an attractive price. In this regard, it has been disclosed in the section headed “8. Further information on determination of the Total Consideration – (b) Gain expected to accrue to the Group” that an unaudited gain is expected. The Disposal also means the Group can cease to invest resources in a business operation which has been loss making and thus liberalising resources on other business operations of the Group and that the proceeds from the Disposal will improve the financial position of the Group with the cash consideration to be received, providing resources for the Group to invest in the new business as disclosed in the section headed “9. Use of Proceeds from the Disposal”.

In view of the above reasons and benefits, the Directors (including all the independent non-executive Directors) consider that the terms of the Transactions are fair and reasonable and in the interests of the Shareholders as a whole.

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LETTER FROM THE BOARD

12. IMPLICATIONS UNDER LISTING RULES

As one of the applicable percentage ratios (as defined in Rule 14.07 of the Listing Rules) in respect of the Disposal exceeds 75%, the Disposal constitutes a very substantial disposal for the Company and is therefore subject to the reporting, announcement and shareholders’ approval requirements under Chapter 14 of the Listing Rules.

13. EGM

The EGM will be held for the Shareholders to consider and, if thought fit, approve the Equity Transfer Agreement and the Loan Transfer Agreement and the transactions contemplated thereunder.

A notice convening the EGM to be held at Lavender, Level 3, Three Pacific Place, 1 Queen’s Road East, Admiralty, Hong Kong on Thursday, 17 November 2016 at 3:00 p.m. is set out on pages EGM-1 to EGM-2 of this circular. A form of proxy for the EGM is enclosed with this circular. Whether or not you intend to attend the EGM, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return the same to the branch share registrar and transfer office of the Company in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not less than 48 hours before the time appointed for the EGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM if you so wish.

The ordinary resolution to approve the Equity Transfer Agreement and the Loan Transfer Agreement and the transactions contemplated thereunder at the EGM will be taken by poll and an announcement on the results of the EGM will be made by the Company after the EGM.

14. VOTING RECOMMENDATION

The Directors are of the opinion that, having considered the factors and reasons set out in the section headed “11. Reasons and Benefits for entering into the Transactions”, the Transactions are in the interests of the Group and the Shareholders as a whole and that the terms of the Transactions are fair and reasonable so far as the Group and the Shareholders are concerned. The Board would recommend the Shareholders to vote in favour of the resolution(s) approving the Transactions at the EGM.

The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, none of the Shareholders or his close associate(s) has a material interest in the Transactions and will be required to abstain from voting on the resolution(s) approving the Transactions.

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LETTER FROM THE BOARD

15. ADDITIONAL INFORMATION

Your attention is drawn to the information set out in the appendices to this circular.

Yours faithfully,

For and on behalf of the board of directors of

Parkson Retail Group Limited Tan Sri Cheng Heng Jem Executive Director & Chairman

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

AUDITED FINANCIAL INFORMATION OF THE GROUP FOR THE LAST THREE FINANCIAL YEARS

The financial information of the Group for the financial years ended 31 December 2013, 2014 and 2015 had been set out in the annual reports of the Company for these financial years and are available on the website of the Stock Exchange, the relevant links of which are specifically set out below:

Financial year ended	Link
31 December 2013	http://www.hkexnews.hk/listedco/listconews/SEHK/2014/0411/
	LTN20140411125.pdf
31 December 2014	http://www.hkexnews.hk/listedco/listconews/SEHK/2015/0421/
	LTN20150421746.pdf
31 December 2015	http://www.hkexnews.hk/listedco/listconews/SEHK/2016/0414/
	LTN20160414504.pdf

The aforesaid annual reports of the Company are also available on the Company’s website at www.parksongroup.com.cn.

UNAUDITED FINANCIAL INFORMATION OF THE GROUP FOR THE SIX MONTHS ENDED 30 JUNE 2016

Please refer to the interim report of the Company published on 22 September 2016 for the unaudited consolidated statements and financial position of the Group for the six months ended 30 June 2016.

The aforesaid interim report of the Company is available on the Company’s website (www.parksongroup.com.cn) and the Stock Exchange’s website (www.hkexnews.com.hk).

– I-1 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

INDEBTEDNESS

As at the close of business on 30 September 2016, being the latest practicable date for the purpose of the indebtedness statement prior to the printing of this circular, the Group had outstanding interest-bearing bank loans of approximately RMB714,746,000 and Bonds (as defined below) of outstanding principal amounts of approximately RMB3,222,358,000, details of which are set out as follows:

(a) Bank loans

As at 30 September 2016, the Group had secured interest-bearing bank loans of approximately RMB715,599,000 as follows:

Bank loans denominated in US$ Lender USD’000 11,250 Financial Institution 11,250 Financial Institution 11,250 Financial Institution 11,250 Financial Institution Bank loans denominated in HK$ HKD’000 31,235 Financial Institution 34,577 Financial Institution 75,000 Financial Institution 140,310 Financial Institution 200,000 Financial Institution Total	As at 30 September 2016 RMB’000 75,125 75,125 75,125 75,125 300,500 26,893 29,771 64,575 120,807 172,200 414,246 714,746	Investment in principal guaranteed deposits pledged for bank loans RMB’0000 77,000 82,000 77,000 77,000 *18,000
		331,000

		30,000 30,000 67,000 123,000 185,000
		435,000
		766,000

This amount represented a blanket pledge for all of the above bank loans.

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

(b) Bonds

On 3 May 2013, the Company issued the 4.5% bonds due 2018 (the “Bonds”) with an aggregate principal amount of US$500 million. The net proceeds excluding direct transaction costs were US$494.3 million (equivalent to approximately RMB3,070,295,000). The Bonds, which are listed on the Stock Exchange, bear a fixed coupon at 4.5% per annum, payable semi-annually in arrears on 3 May and 3 November in each year and commenced on 3 November 2013. The maturity date is 3 May 2018.

As at 30 September 2016, the Group had repurchased bonds with an aggregate principal amount of US$15.5 million on the Stock Exchange. The outstanding principal amount of the Bonds as at 30 September 2016 was approximately US$482.5 million.

Save as disclosed above and apart from intra-group liabilities, the Group did not have any other outstanding loans, mortgages, charges, debentures, loan capital and bank overdrafts or other similar indebtedness, financial leases or hire purchase commitment, liabilities under acceptances (other than normal trade and other payables), or acceptance credits, or any guarantees or other material contingent liabilities at the close of business on 30 September 2016.

FINANCIAL AND TRADING PROSPECTS OF THE GROUP FOR THE FINANCIAL YEAR ENDING 31 DECEMBER 2016

Transformation continues

The Group will continue to remain focus and determined with the execution of its transformation strategies during this challenging phase of its business cycle.

The Parkson Newcore Citymall, which was officially opened in January 2016, had introduced an all-new shopping experience to the consumers in Shanghai. This Korean-themed outlet offers a wide range of merchandise and dining selections that have been thoughtfully picked to distinguish it from other shopping destinations in the city. It is the first off-price retail city mall that offers value for money products in a vibrant and energetic shopping environment. Sales of the transformed store had more than doubled during the first six months of year 2016, showing consumers’ recognition towards this new retail concept that emphasizes a total shopping experience. Using this successful concept as a base point, the Group will continue to roll out innovative and creative retail concepts to our network of stores.

On 18 June 2016, the Group marked a milestone with the grand opening of the Qingdao Lion Mall, which signifies the Group’s entry into the shopping mall market segment in China. The Qingdao Lion Mall, which has a gross floor area of 230,000 sqm and retail area of approximately 123,000 sqm, offers more than 200 brands, including renowned brands like Chanel, Christian Dior, Muji, Spao, Chaps and TOUS to the Qingdao consumers. As the Group’s pilot lifestyle establishment, the Qingdao Lion Mall showcases Parkson’s department store, supermarket, fashion labels and food and beverage (“ F&B ”) offerings all under one roof.

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

Approximately 25% of the Lion Mall’s retail area is occupied by brands under the Group. The Group demonstrated strong business ties with major international cosmetic brands by successfully recruiting brands like Lancôme, Sisley, Yves Saint Laurent and Giorgio Armani into the mall. The Group will continue to leverage on this strength for future development.

Enhancement of cross platform experience for the Group’s consumers is one of the Group’s key focus. In June 2016, the Group had officially launched a mobile shopping application, Parkson Plaza (“百盛商城”) to complement the Group’s website “百盛網” (www.parkson.com.cn). The Group has synchronized selected categories of products across different platforms, offering online consumers real time access to the Group’s in store merchandise. By giving online consumers a choice to pick up their orders at the Group’s stores, the Group is channeling online traffic to its physical stores. The Group will expand its partnership with more mobile payment providers to offer consumers with a wider selection of mobile payment options, while lowering payment handling fees for the Group.

In the first quarter of 2016, the Group closed two underperforming stores as part of management’s continuous effort to optimize the performance of its network of stores. Department store opening plans have been carefully reviewed and moving forward, resources needed to improve the performance of existing department stores and to develop new retail formats like supermarkets and beauty halls will be prioritized. Stores operation will be enhanced through tailor-made transformation plans that are customized for each store. The Group will also continue to explore further collaboration with E•Land Group to convert underperforming stores into city malls format.

Acknowledging human resources as a key success factor, the Group continues to invest in talent for future growth. While the Group lays the foundations of future revenue streams, a group wide cost rationalization exercise has been rolled out to increase productivity and minimize costs. Lease agreement re-negotiation remained a key component of this exercise especially for underperforming stores.

Seize the opportunities

Moving forward, the Group will continue to enrich its products and services offerings through expansion of its fashion and F&B brands. A flagship bakery store under the brand “Hogan Bakery”, which was brought in from Taiwan, will be opened in one of Shanghai’s tourist landmarks “Xin Tian Di” in the fourth quarter of 2016. The first Parkson standalone supermarket had been opened in September to further optimize the Group’s retail format. The content of the Group’s mobile shopping application will be further enriched to increase interaction and engagement with the Group’s consumers.

The Group will continue to review its assets portfolio to identify opportunities to unlock resources held up by underperforming stores. Unlocked resources will be invested in new businesses that will expand the Group’s revenue streams for continuous growth.

– I-4 –

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

WORKING CAPITAL

The Directors are of the opinion that, after taking into account the proceeds from the Disposal as mentioned in this circular and the financial resources available to the Group (including but not limited to internally generated funds, cash and cash equivalents), the working capital available to the Group is sufficient for the Group’s requirements for at least 12 months from the date of the publication of this circular.

NO MATERIAL ADVERSE CHANGE

At as the Latest Practicable Date, none of the Directors was aware of any material adverse change in the financial or trading position of the Group since 31 December 2015 (being the date to which the latest published audited financial statements of the Group were made up).

– I-5 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

FOR THE SIX MONTHS ENDED 30 JUNE 2016

Total Gross Sales Proceeds and Operating Revenues

Financial Review

Gross Sales Proceeds (“GSP”) and merchandise gross margin continued to be under pressure with challenging market environment, weak consumer sentiment and intensifying competition. GSP (consists of direct sales, sales proceeds from concessionaire sales, rental incomes, consultancy and management service fees and other operating revenues) decreased by 12.0% to RMB8,495.2 million (inclusive of value-added tax) for the six months ended 30 June 2016 (“1H2016”) compared to the six months ended 30 June 2015 (“1H2015”). Same Store Sales (“SSS”) declined by 12.0%.

Total Sales Proceeds

Total sales proceeds (RMB’000) Direct sales Concessionaire sales Total sales proceeds	Six months ended 30 June 2015 848,797 7,019,615 7,868,412	Six months ended 30 June 2016 883,539 6,017,279
		6,900,818

The Remaining Group generated total merchandise sales of RMB6,900.8 million. The concessionaire sales contributed 87.2% and the direct sales contributed the balance of 12.8%. The Remaining Group’s sales mix presented a similar trend as with the same period last year. The Fashion & Apparel category continued to be the biggest contributor to sales and had contributed 47.3% of the total merchandise sales; the Cosmetics & Accessories is another key category and had contributed 43.9%; the Household & Electrical category and the Groceries and Perishables category contributed the remainder merchandise sales with contribution of 3.5% and 5.3% respectively.

The Remaining Group’s merchandise gross margin (a combination of concessionaire commission rate and the direct sales margin) remained stable compared to 1H2015 decreasing marginally by 0.1% to 16.7%.

Total operating revenues of the Remaining Group for 1H2016 declined by RMB181.0 million or 7.2% to RMB2,324.6 million. The decline in operating revenues was lower than the decline of the GSP due to the increase in rental income that is in line with the Remaining Group’s strategy of increased complementary services in our stores.

– II-1 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Operating Expenses

Purchase of goods and change in inventories

The purchase of goods and change in inventories refer to the cost of sales for the direct sales. In line with the increase in direct sales, the cost of sales rose to RMB749.7 million, an increase of RMB18.2 million or 2.5% from 1H2015.

Staff costs

Staff costs increased by RMB45.6 million or 13.7% to RMB378.4 million in 1H2016 due to (i) contributions from new stores opened in 2015 and 1H2016; (ii) contributions from new business like private labels, food and beverage and shopping malls; and (iii) salary adjustments in line with inflation. The Remaining Group continued to invest in human resources acknowledging that it is one of the key success factors for future growth. On a same store basis, staff costs increased by 3.8%, mainly due to salary adjustments as mentioned above.

As a percentage to GSP, the staff cost ratio increased to 5.2% from 4.0% recorded in 1H2015.

Depreciation and Amortization

Depreciation and amortisation decreased by RMB24.7 million or 13.2% to RMB163.0 million. The decrease was primarily attributable to savings from stores closed. On a same store basis, depreciation cost decreased marginally by 0.6%.

As a percentage to GSP, the depreciation and amortization cost ratio decreased marginally from 2.3% to 2.2% in 1H2016.

Rental Expenses

Rental expenses of RMB594.8 million posted a decrease of RMB126.7 million or 17.6% compared to rental expenses recorded in 1H2015. Included in 1H2015 was an one-off provision made in respect of the arbitral award arising from the disputes in the Beijing Metro City Shopping Plaza’s Tenancy Agreement of RMB138.3 million, excluding the one-off provision rental cost increased by RMB11.6 million or 2.0%. On a same store basis, rental expenses increased by 6.0% due to lease contract renewal during the period.

As a percentage to GSP, the rental expenses ratio decreased to 8.1% from 8.7% recorded in 1H2015.

– II-2 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Other Operating Expenses

Other operating expenses which consist of (a) utilities cost; (b) marketing, promotional and selling expenses; (c) property management expenses; (d) general administrative expenses; and (e) city development and educational surcharge, decreased by RMB46.3 million or 8.6% to RMB491.2 million as a result of management’s cost rationalization efforts. On a same store basis, other operating expenses decreased by 8.1% during the period.

As a percentage to GSP, the other operating expenses ratio increased to 6.7% from 6.5% recorded in 1H2015.

Loss from Operations

In light of the decline in SSS and total operating revenues, the Remaining Group incurred a loss of RMB52.4 million in 1H2016.

Finance Costs, net

The Remaining Group incurred net finance costs of RMB38.6 million in 1H2016 which represented an increase of RMB34.8 million compared to 1H2015. Increase in net finance costs was mainly due to the decrease in finance income by RMB32.3 million or 42.1% in 1H2016 which was mainly due to the decrease in interest rates and cash and bank balances.

Share of Profit from a Joint Venture

This is the share of profit from Xinjiang Youhao Parkson Development Co., Ltd., a joint venture of the Company. The share of profit decreased to RMB10.8 million from RMB14.1 million recorded in 1H2015 due to softening of merchandise sales attributable to subdued consumer sentiment around that region.

Share of Loss from Associates

This is the share of results from (i) Shanghai Nine Sea Lion Properties Management Co. Ltd; (ii) Parkson Newcore Retail Shanghai Ltd; and (iii) Rite BOS Sdn. Bhd. The share of loss was mainly attributable to operating loss incurred by Parkson Newcore Retail Shanghai Ltd during its ramp up period.

Loss before tax

Due to the aforesaid reasons, the Remaining Group incurred a loss before tax of RMB84.0 million during the period under review.

Income Tax Expenses

The Remaining Group’s income tax expenses increased by RMB19.1 million to RMB40.5 million mainly due to reduction in deferred tax assets recognized during the period.

– II-3 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Net Loss for the period

The Remaining Group incurred a net loss of RMB124.5 million for 1H2016, an increase of RMB108.0 million as compared to 1H2015.

Loss Attributable to the Remaining Group

Loss attributable to the Remaining Group was RMB124.9 million in 1H2016, an increase of RMB100.9 million or 421.2% from 1H2015.

Liquidity and Financial Resources

As at 30 June 2016, the cash and cash equivalents and deposits with licensed banks of the Remaining Group (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks) stood at RMB2,753.7 million, representing a reduction of 17.8% from the balance of RMB3,348.8 million recorded as at the end of December 2015. The decrease was mainly due to: (i) net cash outflow from operating activities amounting to RMB212.7 million; (ii) net cash outflow from investing activities amounting to RMB167.8 million; and (iii) net cash outflow from financing activities amounting to RMB214.6 million.

Total debt to total asset ratio of the Remaining Group was 32.1% as at 30 June 2016.

Gearing position

The gearing ratio (total net debt divided by total equity) of the Remaining Group was 26.2% as at 30 June 2016. Total net debt is equal to the sum of bank loans and bonds minus cash and cash equivalents (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks).

As at 30 June 2016, the Remaining Group had outstanding interest-bearing bank loans of RMB803.4 million, of which RMB298.4 million and RMB505.0 million were denominated in currencies of United States dollars and Hong Kong dollars, respectively. Except for bank loans of RMB728.8 million which were repayable after one year, all of the Remaining Group’s bank loans were repayable within one year. All of the Remaining Group’s bank loans carried floating interest rates.

As at 30 June 2016, the Remaining Group had outstanding bonds of RMB3,210.8 million which was denominated in United States dollars. The bonds bear a fixed coupon rate at 4.5%, payable semi-annually in arrears on 3 May and 3 November in each year and commenced on 3 November 2013. The maturity date of the bonds is 3 May 2018.

– II-4 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Significant Investments

The Remaining Group had investments in principal guaranteed deposits of RMB1,794.6 million as at 30 June 2016. These investments have terms of less than one year and have expected annual rates of return of 2.51% in average. Pursuant to the underlying contracts or notices, these investments are capital guaranteed upon the maturity date.

Current Assets and Net Assets

The Remaining Group’s current assets as at 30 June 2016 were RMB4,557.5 million. Net assets of the Remaining Group as at 30 June 2016 declined to RMB4,808.5 million, a decrease of RMB229.6 million or 4.6% over the balance as at 31 December 2015.

Pledge of Assets

As at 30 June 2016, the Remaining Group has an onshore pledged deposits of RMB843.0 million. Save for the above, no other assets are pledged to any bank or lender.

Segmental Information

Over 90% of the Remaining Group’s turnover and contribution to the operating profit is attributable to the operation and management of department stores and over 90% of the Remaining Group’s turnover and contribution to the operating profit is attributable to customers in the PRC and over 90% of the Remaining Group’s operating assets are located in the PRC.

Employees

As at 30 June 2016, total number of employees for the Remaining Group was 8,409. The Remaining Group ensures that all levels of employees are paid competitively within the standard in the market and employees are rewarded on performance related basis within the framework of the Remaining Group’s salary, incentives and bonus scheme.

Contingent Liabilities

The Remaining Group had not material contingent liabilities.

Treasury Policies

The business transactions of the Remaining Group were mainly denominated in Renminbi. Therefore, except for the capital market transactions for funding needs, there is limited exposure in foreign exchange risk. Hedging instruments including swaps and forwards have been used in the past and would be used in the future, if necessary, to ensure that the Remaining Group’s exposure to the foreign exchange rate fluctuation and the interest rate fluctuation is minimized.

– II-5 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Material Acquisitions and Disposals of Subsidiaries and Associated Companies

There was no material acquisitions and disposals of subsidiaries and associated companies.

FOR THE YEAR ENDED 31 DECEMBER 2015

Total Gross Sales Proceeds and Operating Revenues

Financial Review

GSP and merchandise gross margin continued to be under pressure with challenging market environment, weak consumer sentiment and intensifying competition. GSP (consists of direct sales, sales proceeds from concessionaire sales, rental incomes, consultancy and management service fees and other operating revenues) decreased by 6.9% to RMB18,099.8 million (inclusive of value-added tax) in the financial year of 2015 (“FY2015”) Year On Year (“YOY”). SSS declined by 8.0%.

Total Sales Proceeds

Total sales proceeds (RMB’000) Direct sales Concessionaire sales Total sales proceeds	2014 1,645,004 14,281,837 15,926,841	2015 1,638,052 13,109,347
		14,747,399

Total merchandise sales totalled to RMB14,747.4 million (net of value-added tax) in FY2015. Concessionaire sales continued to be the key sales driver and had contributed 88.9% of merchandise sales for FY2015. The balance of 11.1% came from direct sales. Merchandise mix remained stable with the Fashion & Apparel category contributing 47.4% of the total merchandise sales, the Cosmetics & Accessories category contributing 43.4%, the Household & Electrical category contributing 3.9% and the balance of 5.3% contributed by the Groceries and Perishables category.

The Remaining Group’s merchandise gross margin (a combination of concessionaire commission rate and the direct sales margin) decreased by 0.7% to 16.8% in FY2015 due to promotions and discounts offered during the year. FY2015 had been a highly promotional year for retailers of different formats due to weak consumer sentiments. To maintain market share, discounts and promotional activities were launched more frequently at higher rates compared to the financial year of 2014 (“FY2014”).

– II-6 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Total operating revenues of the Remaining Group decreased by RMB276.4 million or 5.5% to RMB4,738.7 million in FY2015 due to the decline in commissions from concessionaire sales of RMB299.7 million. Attributed to performance of the cosmetics department, direct sales of RMB1,638.1 million remained resilience to market pressure and were almost unchanged compared to the sale figures last year. Rental income continued to grow in FY2015 and increased by 5.9% to RMB327.3 million as a result of the Remaining Group’s transformation programme in allocating more operating area for complementary services.

Operating Expenses

Purchase of goods and change in inventories

The purchase of goods and change in inventories refer to the cost of sales for the direct sales. In line with the fluctuation in direct sales, cost of sales in FY2015 of RMB1,409.3 million remained almost unchanged compared to FY2014.

Staff costs

Staff costs increased by 11.4% YOY to RMB688.2 million. The increase was primarily attributable to contribution from new stores, additional headcount from new ventures and salary adjustment in July 2014 to retain talents during the current challenging time. On a same store basis, staff costs increased by 7.9%. To cope with the increase in cost, programs and training had been rolled out to increase staff productivity.

As a percentage to GSP, the staff cost ratio increased from 3.7% to 4.4%.

Depreciation and Amortization

Depreciation and amortization increased marginally by 0.4% YOY to RMB371.8 million. On a same store basis, the depreciation and amortization cost decreased by 4.2%. The decrease was primarily attributable to the increase in number for stores with assets that has been fully depreciated.

As a percentage to GSP, the depreciation and amortization cost ratio increased to 2.4% from 2.2%.

Rental Expenses

Rental expenses increased by 13.2% to RMB1,269.6 million, mainly due to an one-off litigation loss in respect of the arbitral award arising from the disputes on the Beijing Metro City Shopping Plaza’s Tenancy Agreement of RMB138.3 million and inclusion of rental cost of new stores opened in second half of 2014 and during FY2015. On a same store basis, rental expenses declined by 3.8%. The decrease is due to the management’s success in lease contract renegotiation of a few stores within the Remaining Group.

– II-7 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Due to the aforesaid reasons, as a percentage to GSP, the rental expenses ratio increased from 6.7% to 8.1%.

Other Operating Expenses

Other operating expenses which consist of (a) utilities cost; (b) marketing, promotional and selling expenses; (c) property management expenses; and (d) general administrative expenses decreased to RMB1,095.7 million, a decrease of 6.0% or RMB70.1 million due to management’s effort to rationalize cost within the Remaining Group. On a same store basis, other operating expenses decreased by 10.0%.

As a percentage to GSP, the other operating expenses ratio remained unchanged as FY2014 at 7.0%.

Loss from Operations

The Remaining Group incurred a loss from operations of RMB96.0 million for FY2015. Such loss was mainly attributable to (i) an one-off litigation loss in respect of the arbitral award arising from the disputes on the Beijing Metro City Shopping Plaza’s Tenancy Agreement which amounted to RMB140.9 million; (ii) cost incurred by new business ventures and new stores during their ramp up period; and (iii) increasingly competitive landscape of the retail sector which has led to drops in both sales and gross profit. Without taking into account the aforesaid one-off litigation loss, the Remaining Group would have recorded a profit from operations of RMB44.9 million.

As a percentage to GSP, profit from operations declined marginally from 1.9% in FY2014 to loss from operations of (0.6%) in FY2015. On a same store basis, profit from operations declined by 38.6%.

Finance (Costs)/Income, net

The Remaining Group incurred net finance costs of RMB36.2 million in FY2015 as opposed to net finance income of RMB21.1 million in FY2014. The change from net finance income in FY2014 to net finance costs in FY2015 was due to the combined effect of decreased finance income of RMB40.2 million and increased finance costs of RMB17.1 million. Decrease in finance income of 23.6% in FY2015 was mainly due to decrease in interest rates and cash balances. Increase in finance costs was in line with the increase in off-shore bank loans drawn down for distribution of dividend.

Share of Profit from a Joint Venture

This is the share of profit from Xinjiang Youhao Parkson Development Co., Ltd., a joint venture of the Company. The share of profit decreased to RMB24.0 million from RMB30.8 million recorded in FY2014 due to softening of merchandise sales attributable to subdued consumer sentiment around that region and remodeling work carried out in the store during the year.

– II-8 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Share of Loss from Associates

This is the share of results from (i) Shanghai Nine Sea Lion Properties Management Co. Ltd; (ii) Parkson Newcore Retail Shanghai Ltd; and (iii) Rite BOS Sdn. Bhd. The share of loss is mainly attributable to pre-operating costs incurred by Parkson Newcore Retail Shanghai Ltd during its revamp period.

(Loss)/Profit from operations before income tax (“PBT”)

Due to the aforesaid reasons, the Remaining Group incurred a loss before tax of RMB120.3 million. As a percentage to GSP, the PBT ratio decreased from 2.3% to (0.8%).

Income Tax Expenses

In line with the decline of results before tax, the Remaining Group’s income tax expenses reduced by 51.6% to RMB63.5 million. The Remaining Group continued to incur tax expenses even though it has a loss before tax as the Remaining Group is subjected to income tax on an entity basis. Offshore finance expenses which are not tax deductible and tax losses from new stores are the main reasons for the higher effective tax rates.

Net Loss for the year

The Remaining Group incurred a net loss of RMB183.9 million for FY2015, a reduction of RMB430.6 million or 174.5% as compared to 2014. As a percentage to GSP, the net profit margin declined from 1.5% to (1.2%).

Loss Attributable to the Remaining Group

Loss attributable to the Remaining Group was RMB187.4 million in FY2015, a decline of RMB423.4 million or 179.4% from 2014.

Liquidity and Financial Resources

As at 31 December 2015, the cash and cash equivalents of the Remaining Group (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks) stood at RMB3,348.8 million, of which, RMB3,220.2 million was denominated in Renminbi, representing a decrease of 31.4% from balance as at 31 December 2014 of RMB4,881.1 million. The decrease was primarily due to (i) net cash outflow from operating activities amounted to RMB373.3 million; (ii) net cash outflow from investing activities amounted to RMB819.3 million; and (iii) net cash outflow from financing activities amounted to RMB339.7 million.

Total debt to total assets ratio of the Remaining Group was 30.4% as at 31 December

– II-9 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Gearing position

The gearing ratio (total net debt divided by total equity) of the Remaining Group was 13.3 as at 31 December 2015. Total net debt is equal to the sum of bank loans and bonds minus cash and cash equivalents (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks).

As at 31 December 2015, the Remaining Group had outstanding interest-bearing bank loans of RMB790.3 million, of which RMB292.2 million and RMB498.1 million were denominated in currencies of United States dollars and Hong Kong dollars, respectively. Except for bank loans of RMB498.1 million which were repayable after one year, all of the Remaining Group’s bank loans were repayable within one year. All of the Remaining Group’s bank loans carried floating interest rates.

As at 31 December 2015, the Remaining Group had outstanding bonds of RMB3,227.1 million which was denominated in United States dollars. The bonds bear a fixed coupon rate at 4.5%, payable semi-annually in arrears on 3 May and 3 November in each year and commenced on 3 November 2013. The maturity date of the bonds is 3 May 2018.

Significant Investments

The Remaining Group had investments in principal guaranteed deposits of RMB2,075.1 million as at 31 December 2015. These investments have terms of less than one year and have expected annual rates of return of 2.78% in average. Pursuant to the underlying contracts or notices, these investments are capital guaranteed upon the maturity date.

Current Assets and Net Assets

The Remaining Group’s current assets as at 31 December 2015 was RMB5,266.0 million, a decrease of 22.2% or RMB1,498.6 million YOY. Net assets of the Remaining Group as at 31 December 2015 decreased by 11.0% to RMB5,038.1 million.

Pledge of Assets

As at 31 December 2015, the Remaining Group has onshore pledged deposits of RMB816.0 million to secure short-term bank loans. Other than the aforesaid, no other asset is pledged to any bank or lender.

Segmental Information

– II-10 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Employees

As at 31 December 2015, total number of employees for the Remaining Group was 9,071. The Remaining Group ensures that all levels of employees are paid competitively within the standard in the market and employees are rewarded on performance related basis within the framework of the Remaining Group’s salary, incentives and bonus scheme.

Contingent Liabilities

A subsidiary of the Remaining Group located in the PRC is a plaintiff in a lawsuit whereby the subsidiary has raised objection to a claim brought by a third party claiming that the lease contract had expired and the subsidiary should vacate the premises. The third party later filed a counterclaim against the subsidiary, alleging the subsidiary to vacate the premises and bear a certain amount of occupying penalty. The relevant dispute had been resolved as disclosed in the announcement of the Company dated 25 April 2016.

Treasury Policies

Material Acquisitions and Disposals of Subsidiaries and Associated Companies

There was no material acquisitions and disposals of subsidiaries and associated companies.

FOR THE YEAR ENDED 31 DECEMBER 2014

Total Gross Sales Proceeds And Operating Revenues

The Remaining Group recorded a total GSP (consists of direct sales, sales proceeds from concessionaire sales, rental incomes, consultancy and management service fees and other operating revenues) of RMB19,449.4 million (inclusive of value-added tax) in FY2014, representing a YOY decline of 4.2%. The key contributors to the GSP decline include (i) decline in SSS by 7.1% due to generally weaker sentiment on discretionary spending; (ii) rising competition from various retail platforms; (iii) a continuous austerity drive by the government; and (iv) absence of speculative demand on gold and jewellery products which was experienced in the second quarter of 2013. Excluding the impact from gold and jewellery products, SSS decline in FY2014 was 5.2%.

– II-11 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Total Sales Proceeds

Total sales proceeds (RMB’000) Direct sales Concessionaire sales Total sales proceeds	2013 1,576,693 15,036,040 16,612,733	2014 1,645,004 14,281,837
		15,926,841

The Remaining Group generated total merchandise sales of RMB15,926.8 million (net of value-added tax). The Fashion & Apparel category made up 46.8% of the total merchandise sales, the Cosmetics & Accessories category contributed 43.9%, the Household & Electrical category contributed 3.9% and the balance of 5.4% came from the Groceries and Perishables category.

Despite intensifying competition, the Remaining Group’s merchandise gross margin (a combination of concessionaire commission rate and the direct sales margin) remained at 17.5% in FY2014, which was the same rate as recorded last year. This is mainly due to change in merchandise mix as a result of lower sales contribution from low-margin merchandise such as gold and jewellery products, but the resulted margin improvement was offset by the discount and promotional campaigns carried out by the Remaining Group such as the WeShopping Festival, Single’s Day, Double’s Day, etc.

Total operating revenues of the Remaining Group declined marginally by 1.8% to RMB5,015.1 million. The marginal decline in operating revenue was mainly due to the decline in GSP. The decline rate for operating revenues was noticeably lower than the decline rate of the GSP due to: (i) increase of direct sales revenue by 4.3% which mainly attributed to the resilient performance of the cosmetics department; and (ii) increase in rental income by 9.9% as a result of the Remaining Group’s transformation programme in allocating more operating area for complementary services.

Operating Expenses

Purchase of goods and change in inventories

The purchase of goods and change in inventories refer to the cost of sales for the direct sales. In line with the increase of direct sales, the cost of sales rose to RMB1,413.3 million, an increase of 6.0% or RMB79.5 million YOY.

– II-12 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Staff costs

Staff costs increased by 4.9% YOY to RMB617.9 million. The increase was primarily attributable to contribution from new stores and general wage rise. On a same store basis, staff cost increased marginally by 4.1%.

As a percentage to GSP, the staff cost ratio increased from 3.4% to 3.7%.

Depreciation and Amortization

Depreciation and amortization increased by 4.5% YOY to RMB370.2 million. The increase was primarily attributable to contribution from new stores as well as additional depreciation cost in relation to the remodeled stores. On a same store basis, the depreciation and amortization cost decreased marginally by 1.6%.

As a percentage to GSP, the depreciation and amortization cost ratio increased from 2.0% to 2.2%.

Rental Expenses

Rental expenses reduced by 4.7% to RMB1,121.8 million, mainly due to (i) rental discounts received from the landlords in respect of the rental advances made by the Group; and (ii) reversal of straight-line rental due to store closures. On a same store basis, rental expenses declined by 4.4%.

As a percentage to GSP, the rental expenses ratio remained at 6.7% as compared to last year.

Other Operating Expenses

Other operating expenses consisting of (a) utilities cost; (b) marketing, promotional and selling expenses; (c) property management expenses; and (d) general administrative expenses rose to RMB1,165.8 million, an increase of 4.7% or RMB51.8 million due to (i) the contribution from new stores; and (ii) provision for store closure expenses. On a same store basis, other operating expenses decreased by 7.9% due to the Remaining Group’s cost rationalization exercise.

Due to the aforesaid reasons, as a percentage to GSP, the other operating expenses ratio increased from 6.4% to 7.0%.

Profit from Operations

In light of the decline in SSS and operating revenue, profit from operations declined by 39.7% to RMB326.1 million. As a percentage to GSP, the profit from operations margin declined from 3.1% in FY2013 to 1.9% in FY2014. On a same store basis, profit from operations declined by 14.4%.

– II-13 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Finance Income, net

Net finance income declined by 33.2% to RMB21.1 million due to combination of (i) higher finance costs due to the refinancing which was completed in May 2013; (ii) interest expenses arising from new offshore short-term borrowings; and (iii) lower interest income due to decline in onshore deposits rates and average cash balances.

Share of Profit from a Joint Venture

This is the share of profit from Xinjiang Youhao Parkson Development Co. Ltd., a joint venture of the Company. The share of profit decreased by 13.9% to RMB30.8 million due to a decline in GSP.

Share of Profit from an Associate

This is the share of profit from Shanghai Nine Sea Lion Properties Management Co. Ltd., an associate of the Company. The share of profit decreased by 14.9% to RMB117,000.

PBT

In light of the decline of profit from operations, PBT dropped 37.9% YOY to RMB378.1 million. As a percentage to GSP, the PBT ratio decreased from 3.5% to 2.3%.

Income Tax Expenses

In line with the decline of PBT, the Remaining Group’s income tax expenses decreased by 44.8% or RMB106.5 million YOY to RMB131.3 million. The effective tax rate for the year was reduced from 39.1% to 34.7% mainly due to certain subsidiaries having obtained preferential tax rate exemption during the year under review.

Net Profit for the year

Due to the aforesaid reasons, net profit for the year declined by 33.4% to RMB246.8 million. As a percentage to GSP, the net profit margin declined from 2.1% to 1.5%.

Profit Attributable to the Remaining Group

Profit attributable to the Remaining Group dropped 32.9% to RMB236.0 million. The substantial decline is mainly due to the one-off store closure provision amounted to RMB105.1 million. Excluding which, profit attributable to the Remaining Group would have amounted to RMB341.1 million, which represented a marginal decline of 3.0% as compared to FY2013.

– II-14 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Liquidity and Financial Resources

As at 31 December 2014, the cash and cash equivalents of the Remaining Group (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks) stood at RMB4,881.1 million, of which, RMB4,692.4 million was denominated in currencies of Renminbi, representing an increase of 1.8% from balance as at 31 December 2013 of RMB4,796.7 million. The increase was primarily due to (i) net cash inflow from operating activities amounted to RMB357.4 million; (ii) net cash outflow from investing activities amounted to RMB392.9 million; and (iii) net cash inflow from financing activities amounted to RMB119.9 million.

Total debt to total assets ratio of the Remaining Group was 26.8% as at 31 December 2014.

Gearing position

The gearing ratio (total net debt divided by total equity) of the Remaining Group was 20.3% as at 31 December 2014. Total net debt is equal to the sum of bank loans and bonds minus cash and cash equivalents (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks).

As at 31 December 2014, the Remaining Group had outstanding interest-bearing bank loans of RMB700.0 million, of which, RMB198.9 million and RMB501.1 million were denominated in currencies of United States dollars and Hong Kong dollars, respectively. All of the Remaining Group’s bank loans were repayable within one year. All of the Remaining Group’s bank loans carried floating interest rates.

As at 31 December 2014, the Remaining Group had outstanding bonds of RMB3,034.5 million which was denominated in United States dollars. The bonds bear a fixed coupon rate at 4.5%, payable semi-annually in arrears on 3 May and 3 November in each year and commenced on 3 November 2013. The maturity date of the bonds is 3 May 2018.

Significant Investments

The Remaining Group had investments in principal guaranteed deposits of RMB3,532.7 million as at 31 December 2014. These investments have terms of less than one year and have expected annual rates of return of 3.78% in average. Pursuant to the underlying contracts or notices, these investments are capital guaranteed upon the maturity date.

Current Assets and Net Assets

The Remaining Group’s current assets as at 31 December 2014 was RMB6,764.6 million, a decrease of 6.5% or RMB470.3 million YOY. Net assets of the Remaining Group as at 31 December 2014 decreased marginally by 0.4% to RMB5,659.9 million.

– II-15 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Pledge of Assets

As at 31 December 2014, the Remaining Group has onshore pledged deposits of RMB725.8 million to secure short-term bank loans. Other than the aforesaid, no other asset is pledged to any bank or lender.

Segmental Information

Employees

As at 31 December 2014, total number of employees for the Remaining Group was 9,439. The Remaining Group ensures that all levels of employees are paid competitively within the standard in the market and employees are rewarded on performance related basis within the framework of the Remaining Group’s salary, incentives and bonus scheme.

Contingent Liabilities

A subsidiary of the Remaining Group located in the PRC is currently a defendant in a lawsuit related to a lease contract termination brought by a third party alleging that the subsidiary should refund the lease deposit and bear a certain amount of contract breach penalty. The subsidiary later made a counter lawsuit against the third party to claim for the unpaid rents in delay. The Directors, based on the advice from the Remaining Group’s legal counsel, believed that the subsidiary has a valid defence against the allegation and, accordingly, the Remaining Group has not provided for any claim arising from the litigations.

Treasury Policies

Material Acquisitions and Disposals of Subsidiaries and Associated Companies

There was no material acquisitions and disposals of subsidiaries and associated companies.

– II-16 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

FOR THE YEAR ENDED 31 DECEMBER 2013

Total Gross Sales Proceeds and Operating Revenues

The Remaining Group recorded a total GSP of RMB17,479.9 million (consists of direct sales, sales proceeds from concessionaire sales, rental incomes, consultancy and management service fees and other operating revenues) during the year under review which representing a growth of 4.3% or RMB726.6 million YOY. The key contributors to the growth include (i) inclusion of the sales performance of the 10 new stores opened in the year 2012 and 2013; and (ii) inclusion of the sales performances of 4 acquired stores that were previously managed by the Remaining Group on behalf of the parent company. The growth was however partly offset by (i) the marginal decline in SSS by 1.8%; (ii) the closure of Shanghai Hongqiao store and Guizhou Jin Feng Huang store in 2012 and Shijiazhuang store in 2013; and (iii) the temporary closure of Shanghai flagship store due to major remodeling.

Total Sales Proceeds

Total sales proceeds (RMB’000) Direct sales Concessionaire sales Total sales proceeds	2012 1,537,520 14,370,811 15,908,331	2013 1,576,693 15,036,040
		16,612,733

The Remaining Group generated total merchandise sales of RMB16,612.7 million. The Fashion & Apparel category made up 46.6% of the total merchandise sales, the Cosmetics & Accessories category contributed 43.4%, the Household & Electrical category contributed 4.2% and the balance of 5.8% came from the Groceries and Perishables category.

Due to intensifying competition and increasing number of younger and new stores with lower margin performance, the Remaining Group’s merchandise gross margin (a combination of concessionaire commission rate and the direct sales margin) declined by 0.7% to 17.5%. Specifically, the decline in merchandise gross margin was primarily attributable to: (i) higher sales contribution from the younger stores and new stores with lower merchandise gross margin; (ii) lower sales contribution from stores with higher merchandise gross margin in particular the Beijing and Shanghai flagship stores; and (iii) higher sales contribution from merchandise with lower merchandise gross margin such as gold and jewelry.

Total operating revenues for the year grew by RMB77.8 million or 1.5% to RMB5,109.1 million. The growth rate of operating revenues was lower than the growth rate of the GSP due to (i) lower growth rate of management and consultancy fees; (ii) marginal decline of other operating revenues; and (iii) lower concessionaire rate.

– II-17 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Operating Expenses

Purchase of goods and change in inventories

The purchase of goods and change in inventories refer to the cost of sales for the direct sales. In line with the increase of direct sales, the cost of sales rose to RMB1,333.7 million, an increase of 3.5% or RMB44.9 million YOY.

Staff costs

Staff costs increased by 22.8% YOY to RMB589.2 million. The substantial increase was primarily attributable to (i) inclusion of the staff cost of new stores opened in 2012 and 2013; (ii) inclusion of the staff cost of four managed stores acquired from the parent company; and (iii) general wage rise. On a same store basis, staff cost increased by 6.1% due to general wage rise.

As a percentage to GSP, the staff cost ratio increased from 2.9% to 3.4%.

Depreciation and Amortization

Depreciation and amortization increased by 36.4% YOY to RMB354.4 million. The increase was primarily attributable to (i) the inclusion of depreciation and amortization cost of the new stores opened in 2012 and 2013; (ii) the inclusion of depreciation and amortization cost of four managed stores acquired from the parent company; (iii) additional depreciation cost in relation to the remodeled stores; and (iv) accelerated depreciation of stores with potential closure amounted to RMB57.1 million. On a same store basis, the depreciation and amortization cost increased by 10.5% due to the remodeled stores.

As a percentage to GSP, the depreciation and amortization cost ratio increased from 1.6% to 2.0%.

Rental Expenses

Rental expenses rose to RMB1,176.8 million, a substantial increase of 24.8% or RMB233.6 million YOY, the increase was largely due to (i) the inclusion of rental cost of the new stores opened in 2012 and 2013; (ii) the inclusion of rental cost of 4 managed stores acquired from the parent company; and (iii) the adjustment of straight-line rental of new stores and acquired stores amounted to RMB116.2 million. The increase was partly offset by the rental discounts received from the landlords in respect of the rental prepayment. On a same store basis, the rental expenses growth was flat.

As a percentage to GSP, the rental expenses ratio increased from 5.6% to 6.7%.

– II-18 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Other Operating Expenses

Other operating expenses which consist of the (a) utilities cost; (b) marketing, promotional and selling expenses; (c) property management expenses; and (d) general administrative expenses rose to RMB1,114.0 million, an increase of 13.0% or RMB128.1 million due to (i) the inclusion of full year other operating expenses for the new stores opened 2012 and 2013; (ii) the inclusion of pre-opening expenses and other operating expenses of 4 managed stores acquired from the parent company; and (iii) provision for penalty of early termination of lease contracts of stores with potential closure amounted to RMB30.0 million. On a same store basis, other operating expenses decreased by 2.3% in line with the Remaining Group’s strategy to control its operating cost.

Due to the aforesaid reasons, as a percentage to GSP, the other operating expenses ratio increased from 5.9% to 6.4%.

Profit from Operations

In light of the decline in SSS and contraction of merchandise gross margins, temporary closure of Shanghai flagship store, higher start up losses of the increasing new stores and non-comparable items, profit from operations declined by 49.6% to RMB541.0 million. As a percentage to GSP, the profit from operations margin declined from 6.4% in the financial year of 2012 to 3.1% in FY2013. Excluding the impact of store closures and disruptions from subway constructions, on a comparable basis, profit from operations declined by 15.1%.

Finance Incomes, net

Net finance incomes declined by 58.8% to RMB31.5 million due to combination of (i) increase in finance cost due to the refinancing of short-term borrowings with a 5-year US dollar bonds which carry a relatively higher interest rate; and (ii) interest expense arising from new offshore short-term borrowings.

Share of Profit from a Joint Venture

This is the share of profit from Xinjiang Youhao Parkson Development Co. Ltd, a joint venture of the Company. The share of profit decreased by 23.0% to RMB35.8 million due to decline in merchandise gross margin and increase in operating cost.

Share of Profit from an Associate

This is the share of profit from Shanghai Nine Sea Lion Properties Management Co. Ltd, an associate of the Company. The share of profit decreased marginally to RMB137,000.

PBT

In light of the decline of profit from operating activities, PBT dropped 49.2% YOY to RMB608.5 million. As a percentage to GSP, the PBT ratio decreased from 7.1% to 3.5%.

– II-19 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Income Tax Expense

In line with the decline of PBT, the Remaining Group’s income tax expenses decreased by RMB83.6 million YOY to RMB237.8 million. However, the effective tax rate for the year increased from 26.9% to 39.1% due to the increase of operating loss of new stores and offshore interest expense which is not tax deductible.

Net Profit for the year

Due to the aforesaid reasons, net profit for the year declined 57.7% to RMB370.6 million. As a percentage to GSP, the net profit margin declined from 5.2% to 2.1%.

Profit Attributable to the Remaining Group

Profit attributable to the Remaining Group dropped to RMB351.7 million, representing a decline of RMB494.8 million or 58.5%.

Liquidity and Financial Resources

On 3 May 2013, the Company has successfully issued a 5-year US$500 million bond which carries a coupon of 4.5% per annum. The proceeds of the bond were primarily used to refinance the short-term borrowings which consisted of the US$400 million syndicated loan and the US$50 million bridge loan.

As at 31 December 2013, the cash and cash equivalents of the Remaining Group (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks) stood at RMB4,796.7 million, of which, RMB4,262.3 million was denominated in Renminbi, representing a marginal decline of 3.1%. The decrease was primarily due to (i) dividends payment of RMB337.3 million to the shareholders of the Company; (ii) deposits payment of RMB573.1 million for the acquisition of a shopping mall in Qingdao; (iii) balance payment of RMB264.7 million for the acquisition of 4 managed stores from the parent company; and (iv) maintenance capital expenditures and new store opening capital expenditures of RMB440.9 million.

Total debt to total assets ratio of the Remaining Group was 23.3% as at 31 December 2013.

Gearing position

The gearing ratio (total net debt divided by total equity) of the Remaining Group was 28.2% as at 31 December 2013. Total net debt is equal to the sum of bank loans and bonds minus cash and cash equivalents (aggregate of principal guaranteed investment deposit, time deposits and cash and bank balances deposited with licensed banks).

– II-20 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

As at 31 December 2013, the Remaining Group had outstanding interest-bearing bank loans of RMB178.9 million, of which, RMB61.0 million and RMB117.9 million were denominated in currencies of United States dollars and Hong Kong dollars, respectively. All of the Remaining Group’s bank loans were repayable within one year. All of the Remaining Group’s bank loans carried floating interest rates.

As at 31 December 2013, the Remaining Group had outstanding bonds of RMB3,016.8 million which was denominated in United States dollars. The bonds bear a fixed coupon rate at 4.5%, payable semi-annually in arrears on 3 May and 3 November in each year and commenced on 3 November 2013. The maturity date of the bonds is 3 May 2018.

Significant Investments

The Remaining Group had investments in principal guaranteed deposits of RMB3,635.3 million as at 31 December 2013. These investments have terms of less than one year and have expected annual rates of return of 4.74% in average. Pursuant to the underlying contracts or notices, these investments are capital guaranteed upon the maturity date.

Current Assets and Net Assets

The Remaining Group’s current assets as at 31 December 2013 was RMB7,234.9 million, an increase of 2.5% or RMB174.6 million YOY. Net assets of the Remaining Group as at 31 December 2013 rose to RMB5,680.0 million, an increase of RMB23.0 million or 0.4% YOY.

Pledge of Assets

As at 31 December 2013, the Remaining Group has an onshore pledged deposit of RMB146.6 million. Save for the above, no other asset is pledged to any bank or lender.

Segmental Information

Employees

As at 31 December 2013, total number of employees for the Remaining Group was 9,454. The Remaining Group ensures that all levels of employees are paid competitively within the standard in the market and employees are rewarded on performance related basis within the framework of the Remaining Group’s salary, incentives and bonus scheme.

– II-21 –

MANAGEMENT DISCUSSION AND ANALYSIS ON THE REMAINING GROUP

APPENDIX II

Contingent Liabilities

The Remaining Group has no significant contingent liabilities as at 31 December 2013.

Treasury Policies

In relation to the term loan facilities, the Remaining Group has entered into interest rate swaps to hedge the Remaining Group’s exposure against interest rate fluctuation and cross currency swap to minimize the Remaining Group’s exposure to exchange rate fluctuation.

Total debt to total assets ratio of the Remaining Group was 23.3% as at 31 December 2013.

Material Acquisitions and Disposals of Subsidiaries and Associated Companies

There was no material acquisitions and disposals of subsidiaries and associated companies.

FUTURE PLANS FOR MATERIAL INVESTMENTS

As at the Latest Practicable Date, the Remaining Group did not have any future plans for material investments or capital assets and their expected sources of funding in the coming year.

– II-22 –

FINANCIAL INFORMATION OF THE DISPOSAL COMPANY

APPENDIX III

Report on Review of the Financial Information of the Disposal Company of Parkson Retail Group Limited

To the board of directors of Parkson Retail Group Limited (Incorporated in the Cayman Islands with limited liability)

INTRODUCTION

We have reviewed the Financial Information set out on pages III-3 to III-7 which comprise the unaudited statements of financial position of Beijing Huadesheng Property Management Co., Ltd. (the “Disposal Company”) as at 31 December 2013, 2014 and 2015 and 30 June 2016 and the unaudited statements of profit or loss and other comprehensive income, unaudited statements of changes in equity and unaudited statements of cash flows for each of the periods then ended and explanatory notes (the “Financial Information”). The Financial Information has been prepared solely for the purpose of inclusion in the circular to be issued by Parkson Retail Group Limited in connection with the disposal of the Disposal Company in accordance with Main Board Listing Rule 14.68(2)(a)(i)(A).

The directors of the Company are responsible for the preparation and presentation of the Financial Information of the Disposal Company in accordance with the basis of preparation set out in note 2 to the Financial Information and Main Board Listing Rule 14.68(2)(a)(i). The directors are also responsible for such internal control as management determines is necessary to enable the preparation of financial information that is free from material misstatement, whether due to fraud or error. The Financial Information does not contain sufficient information to constitute a complete set of financial statements as defined in International Accounting Standard 1 “Presentation of Financial Statements” or an interim financial report as defined in International Accounting Standard 34 “Interim Financial Reporting” issued by the International Accounting Standards Board. Our responsibility is to express a conclusion on this Financial Information based on our review.

– III-1 –

FINANCIAL INFORMATION OF THE DISPOSAL COMPANY

APPENDIX III

SCOPE OF REVIEW

We conducted our review in accordance with Hong Kong Standard on Review Engagements 2410 “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” and with reference to Practice Note 750 “Review of Financial Information under the Hong Kong Listing Rules for a Very Substantial Disposal” issued by the Hong Kong Institute of Certified Public Accountants. A review of the Financial Information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

CONCLUSION

Based on our review, nothing has come to our attention that causes us to believe that the Financial Information of the Disposal Company for the relevant periods is not prepared, in all material respects, in accordance with the basis of preparation set out in note 2 to the Financial Information.

Certified Public Accountants

Hong Kong 1 November 2016

– III-2 –

APPENDIX III FINANCIAL INFORMATION OF THE DISPOSAL COMPANY

UNAUDITED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

For the three years ended 31 December 2013, 2014 and 2015 and the six-month period ended 30 June 2016

REVENUE Other operating revenues Total operating revenues OPERATING EXPENSES Depreciation Other operating expenses Total operating expenses PROFIT/(LOSS) FROM OPERATIONS Finance income PROFIT/(LOSS) FROM OPERATIONS BEFORE INCOME TAX Income tax expense PROFIT/(LOSS) FOR THE YEAR/PERIOD AND TOTAL COMPREHENSIVE INCOME FOR THE YEAR/PERIOD	Year ended 31 December 2013 2014 2015 RMB’000 RMB’000 RMB’000 50,000 50,000 50,000 1,289 – – 51,289 50,000 50,000 (33,490) (33,803) (33,807) (15,452) (17,323) (14,698) (48,942) (51,126) (48,505) 2,347 (1,126) 1,495 471 76 129 2,818 (1,050) 1,624 (840) 66 (388) 1,978 (984) 1,236	Six-month period ended 30 June 2015 2016 RMB’000 RMB’000 25,000 25,000 – – 25,000 25,000 (16,903) (16,903) (7,239) (7,108) (24,142) (24,011) 858 989 57 12 915 1,001 (205) (289) 710 712

– III-3 –

FINANCIAL INFORMATION OF THE DISPOSAL COMPANY

APPENDIX III

UNAUDITED STATEMENTS OF FINANCIAL POSITION

As at 31 December 2013, 2014 and 2015 and 30 June 2016

NON-CURRENT ASSETS Property, plant and equipment Other assets Total non-current assets CURRENT ASSETS Prepayments, deposits and other receivables Cash and cash equivalents Total current assets CURRENT LIABILITIES Customers’ deposits, other payables and accruals Tax payable Total current liabilities NET CURRENT LIABILITIES Net assets EQUITY Issued capital Reserves Total equity Chong Sui Hiong Director	At 31 December 2013 2014 2015 RMB’000 RMB’000 RMB’000 1,119,086 1,085,288 1,051,497 23,834 21,084 18,334 1,142,920 1,106,372 1,069,831 577,245 832,255 2,750 17,316 3,488 4,560 594,561 835,743 7,310 1,331,115 1,536,733 670,443 – – 80 1,331,115 1,536,733 670,523 736,554 700,990 663,213 406,366 405,382 406,618 400,000 400,000 400,000 6,366 5,382 6,618 406,366 405,382 406,618 Juliana Cheng San San Director	At 30 June 2016 RMB’000 1,034,594 16,959
		1,051,553
		2,834 885
		3,719
		647,824 118
		647,942
		644,223
		407,330

		400,000 7,330
		407,330

– III-4 –

APPENDIX III FINANCIAL INFORMATION OF THE DISPOSAL COMPANY

UNAUDITED STATEMENTS OF CHANGES IN EQUITY

For the three years ended 31 December 2013, 2014 and 2015 and the six-month period ended 30 June 2016

At 1 January 2013 Profit for the year Transfer to the PRC reserve funds At 31 December 2013 and at 1 January 2014 Loss for the year At 31 December 2014 and at 1 January 2015 Profit for the year Transfer to the PRC reserve funds At 31 December 2015 and at 1 January 2016 Profit for the period At 30 June 2016	Share capital RMB’000 400,000 – – 400,000 – 400,000 – – 400,000 – 400,000	PRC reserve funds RMB’000 477 – 198 675 – 675 – 124 799 – 799	Retained earnings RMB’000 3,911 1,978 (198) 5,691 (984) 4,707 1,236 (124) 5,819 712 6,531	Total RMB’000 404,388 1,978 – 406,366 (984) 405,382 1,236 – 406,618 712 407,330

These reserve accounts comprise the consolidated reserves of RMB6,336,000, RMB5,382,000, RMB6,618,000 and RMB7,330,000 as at 31 December 2013, 2014 and 2015 and 30 June 2016, respectively, in the unaudited statements of financial position.

– III-5 –

FINANCIAL INFORMATION OF THE DISPOSAL COMPANY

APPENDIX III

UNAUDITED STATEMENTS OF CASH FLOWS

For the three years ended 31 December 2013, 2014 and 2015 and the six-month period ended 30 June 2016

CASH FLOWS FROM OPERATING ACTIVITIES Profit/(loss) before tax Adjustments for: Interest income Depreciation (Increase)/decrease in prepayments, deposits and other receivables Decrease in other assets Increase/(decrease) in customers’ deposits, other payables and accruals Cash generated from/ (used in) operations Income tax paid Net cash flows from/ (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchases of items of property, plant and equipment Interest received Net cash flows (used in)/from investing activities NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS Cash and cash equivalents at beginning of year/period CASH AND CASH EQUIVALENTS AT END OF YEAR/PERIOD ANALYSIS OF BALANCES OF CASH AND CASH EQUIVALENTS Cash and bank balances	Year ended 31 December 2013 2014 2015 RMB’000 RMB’000 RMB’000 2,818 (1,050) 1,624 (471) (76) (129) 33,490 33,803 33,807 35,837 32,677 35,302 (574,335) (254,667) 829,001 2,750 2,750 2,750 551,105 205,618 (866,290) 15,357 (13,622) 763 (2,029) (277) 197 13,328 (13,899) 960 (1,435) (5) (17) 471 76 129 (964) 71 112 12,364 (13,828) 1,072 4,952 17,316 3,488 17,316 3,488 4,560 17,316 3,488 4,560	Six-month period ended 30 June 2015 2016 RMB’000 RMB’000 915 1,001 (57) (12) 16,903 16,903 17,761 17,892 829,001 (84) 1,375 1,375 (842,115) (22,619) 6,022 (3,436) 120 (251) 6,142 (3,687) (17) – 57 12 40 12 6,182 (3,675) 3,488 4,560 9,670 885 9,670 885

– III-6 –

FINANCIAL INFORMATION OF THE DISPOSAL COMPANY

APPENDIX III

NOTES TO THE FINANCIAL INFORMATION

For the three years ended 31 December 2013, 2014 and 2015 and the six-month period ended 30 June 2016

1. GENERAL INFORMATION

Beijing Huadesheng Property Management Co., Ltd. (the “Disposal Company”) is a limited liability company incorporated in the People’s Republic of China. The Disposal Company principally engaged in property development and property management.

The Parties have entered into the EFA pursuant to which the Vendor has agreed to sell, and the Purchasers have agreed to purchase, the Sale Equity upon the terms and conditions of the EFA. In addition, the Vendor, the Company, Purchaser A and the Purchasers Parent have entered into the LFA with the Disposal Company concurrently with the signing of the EFA. Capitalised terms used herein, unless otherwise defined, shall have the same meanings as those defined in the Circular.

Upon completion of the Disposal, the Disposal Company will cease to be a subsidiary of the Company.

The financial information of the Disposal Company for the years ended 31 December 2013, 2014 and 2015 and the six-month period ended 30 June 2016 is presented in Renminbi (“RMB”). All values are rounded to the nearest thousand (RMB’000) except when otherwise indicated.

2. BASIS OF PREPARATION

The Financial Information of the Disposal Company for the years ended 31 December 2013, 2014 and 2015 and the six-month period ended 30 June 2016 has been prepared solely for the purpose of inclusion in the circular to be issued by the Company in connection with the disposal of the Disposal Company in accordance with Main Board Listing Rule 14.68(2)(a)(i)(A).

The Financial Information has been prepared in accordance with the relevant accounting policies of the Company adopted in the preparation of the consolidated financial statements of the Company and its subsidiaries for the years ended 31 December 2013, 2014 and 2015 and the six-month period ended 30 June 2016, which conform with International Financial Reporting Standards, which include all International Financial Reporting Standards, International Accounting Standards and Interpretations issued by the International Accounting Standards Board. The Financial Information has been prepared under the historical cost convention.

The Financial Information does not contain sufficient information to constitute a complete set of financial statements as defined in International Accounting Standard 1 “Presentation of Financial Statements” or an interim financial report as defined in International Accounting Standard 34 “Interim Financial Reporting” issued by the International Accounting Standards Board.

– III-7 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

A. UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

Introduction

The following is a summary of an illustrative and the unaudited pro forma statement of financial position, the unaudited pro forma statement of profit or loss, the unaudited pro forma statement of comprehensive income, the unaudited pro forma statement of cash flows of the Remaining Group (the “Unaudited Pro Forma Financial Information”), which have been prepared on the basis of the notes set out below for the purpose of illustrating the effects of the Disposal on (a) the financial position of the Remaining Group as if the Disposal had been completed on 30 June 2016; and (b) the results and cash flows of the Remaining Group as if the Disposal had been completed on 1 January 2016. Capitalised terms used herein, unless otherwise defined, shall have the same meanings as those defined in the Circular.

The Unaudited Pro Forma Financial Information of the Remaining Group has been prepared by the Directors of the Company in accordance with paragraph 4.29 of the Listing Rules for illustrative purposes only, based on their judgments, estimations and assumptions, and because of its hypothetical nature, it may not give a true picture of the financial position of the Remaining Group as at 30 June 2016 or at any future date or the results and cash flows of the Remaining Group for the six-month period ended 30 June 2016 or for any future period following the completion of the Disposal.

The Unaudited Pro Forma Financial Information is based on the reviewed consolidated statement of financial position of the Group as at 30 June 2016, the reviewed consolidated statement of profit or loss, the reviewed consolidated statement of comprehensive income and the reviewed consolidated statement of cash flows of the Group for the six-month period ended 30 June 2016 extracted from the reviewed consolidated financial statements of the Group for the six-month period ended 30 June 2016, after giving effect to the pro forma adjustments relating to the Disposal as described in the accompanying notes. Narrative description of the pro forma adjustments that are (i) directly attributable to the transactions and not relating to future events or decisions; and (ii) factually supported, is summarised in the accompanying notes.

The Unaudited Pro Forma Financial Information is based on a number of assumptions, estimates, and uncertainties. Accordingly, the Unaudited Pro Forma Financial Information does not purport to describe the actual financial position, results and cash flows of the Remaining Group that would have been attained had the Disposal been completed on 30 June 2016 and 1 January 2016, respectively. The Unaudited Pro Forma Financial Information does not purport to predict future financial positions or results of the Remaining Group.

– IV-1 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

UNAUDITED PRO FORMA STATEMENT OF FINANCIAL POSITION

NON-CURRENT ASSETS Property and equipment Investment properties Prepaid land lease payments Intangible assets Investment in a subsidiary Investment in a joint venture Investments in associates Other assets Deferred tax assets Total non-current assets CURRENT ASSETS Inventories Trade receivables Prepayments, deposits and other receivables Investment in principal guaranteed deposits Time deposits Cash and cash equivalents Total current assets CURRENT LIABILITIES Trade payables Customers’ deposits, other payables and accruals Interest-bearing bank loans Tax payable Total current liabilities NET CURRENT ASSETS TOTAL ASSETS LESS CURRENT LIABILITIES	The Group as at 30 June 2016 RMB’000 (Note 1) 5,196,223 35,233 427,780 2,221,033 – 39,832 51,651 334,390 278,705 8,584,847 417,485 29,360 729,016 1,749,620 129,945 874,989 3,930,415 1,231,896 1,400,898 728,828 33,160 3,394,782 535,633 9,120,480	Pro forma adjustments RMB’000 RMB’000 RMB’000 (Note 2) (Note 3) (Note 4) (1,034,594) – (6,070) – – – – – – – – – – 407,330 (407,330) – – – – – – (16,959) – – – – – (1,051,553) 407,330 (413,400) – – – – – – (2,834) 647,742 (647,742) – – – – – – (885) – 2,320,000 (3,719) 647,742 1,672,258 – – – (647,824) 647,742 17,556 – – – (118) – 319,000 (647,942) 647,742 336,556 644,223 – 1,335,702 (407,330) 407,330 922,302	Unaudited Pro Forma Remaining Group as at 30 June 2016 RMB’000 4,155,559 35,233 427,780 2,221,033 – 39,832 51,651 317,431 278,705
			7,527,224
			417,485 29,360 726,182 1,749,620 129,945 3,194,104
			6,246,696
			1,231,896 1,418,372 728,828 352,042
			3,731,138
			2,515,558
			10,042,782

– IV-2 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

UNAUDITED PRO FORMA STATEMENT OF FINANCIAL POSITION (CONTINUED)

NON-CURRENT LIABILITIES Bonds Interest-bearing bank loans Long term payables Deferred tax liabilities Total non-current liabilities Net assets EQUITY Issued capital Reserves Non-controlling interests Total equity	The Group as at 30 June 2016 RMB’000 (Note 1) 3,210,835 74,602 749,011 277,525 4,311,973 4,808,507 55,890 4,688,986 63,631 4,808,507	Pro forma adjustments RMB’000 RMB’000 RMB’000 (Note 2) (Note 3) (Note 4) – – – – – – – – – – – – – – – (407,330) 407,330 922,302 (400,000) 400,000 – (7,330) 7,330 922,302 – – – (407,330) 407,330 922,302	Unaudited Pro Forma Remaining Group as at 30 June 2016 RMB’000 3,210,835 74,602 749,011 277,525
			4,311,973
			5,730,809

			55,890 5,611,288
			63,631
			5,730,809

– IV-3 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

UNAUDITED PRO FORMA STATEMENT OF PROFIT OR LOSS

REVENUE Other operating revenues Total operating revenues OPERATING EXPENSES Purchase of goods and changes in inventories Staff costs Depreciation and amortisation Rental expenses Other operating expenses Total operating expenses LOSS FROM OPERATIONS Finance income Finance costs Share of (loss)/profits of: A joint venture Associates Gain on disposal of a subsidiary PROFIT/(LOSS) FROM OPERATIONS BEFORE INCOME TAX Income tax expense PROFIT/(LOSS) FOR THE PERIOD Attributable to: Owners of the parent Non-controlling interests	The Group for the six-month period ended 30 June 2016 RMB’000 (Note 1) 2,100,665 223,968 2,324,633 (749,651) (378,420) (179,870) (569,798) (498,300) (2,376,039) (51,406) 44,552 (83,148) 10,776 (3,738) – (82,964) (40,832) (123,796) (124,207) 411 (123,796)	Pro forma adjustments RMB’000 RMB’000 RMB’000 (Note 5) (Note 6) (Note 7) (25,000) 25,000 – – – – (25,000) 25,000 – – – – – – – 16,903 – – – (25,000) – 7,108 – – 24,011 (25,000) – (989) – – (12) – – – – – – – – – – – – – 1,219,395 (1,001) – 1,219,395 289 – (319,000) (712) – 900,395 (712) – 900,395 – – – (712) – 900,395	Unaudited Pro Forma Remaining Group for the six-month period ended 30 June 2016 RMB’000 2,100,665 223,968 2,324,633 (749,651) (378,420) (162,967) (594,798) (491,192) (2,377,028) (52,395) 44,540 (83,148) 10,776 (3,738) 1,219,395 1,135,430 (359,543) 775,887 775,476 411 775,887

– IV-4 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

UNAUDITED PRO FORMA STATEMENT OF COMPREHENSIVE INCOME

PROFIT/(LOSS) FOR THE PERIOD OTHER COMPREHENSIVE INCOME Other comprehensive income to be reclassified to profit or loss in subsequent periods: Exchange differences on translation of foreign operations OTHER COMPREHENSIVE INCOME FOR THE PERIOD, NET OF TAX TOTAL COMPREHENSIVE INCOME FOR THE PERIOD Attributable to: Owners of the parent Non-controlling interests	The Group for the six-month period ended 30 June 2016 RMB’000 (Note 1) (123,796) (58,385) (58,385) (182,181) (182,592) 411 (182,181)	Pro forma adjustments RMB’000 RMB’000 RMB’000 (Note 5) (Note 6) (Note 7) (712) – 900,395 – – – – – – (712) – 900,395 (712) – 900,395 – – – (712) – 900,395	Unaudited Pro Forma Remaining Group for the six-month period ended 30 June 2016 RMB’000 775,887 (58,385) (58,385) 717,502 717,091 411 717,502

– IV-5 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

UNAUDITED PRO FORMA STATEMENT OF CASH FLOWS

CASH FLOWS FROM OPERATING ACTIVITIES Profit/(loss) before tax Adjustments for: Share of profits of a joint venture and associates Interest income Interest expenses Depreciation and amortisation Foreign exchange loss Loss on disposal of items of property, plant and equipment Gain on disposal of a subsidiary Impairment of inventories Reverse of impairment of other receivables Decrease in other assets Increase in inventories Decrease in trade receivables Decrease in prepayments, deposits and other receivables Decrease in trade payables Decrease in customers’ deposits, other payables and accruals Increase in long-term payables Cash used in operations Income tax paid Net cash flows used in operating activities	The Group for the year ended 30 June 2016 RMB’000 (Note 1) (82,964) (7,038) (44,552) 83,148 179,870 86 1,538 – 7,509 (306) 137,291 69,756 (34,224) 31,770 72,122 (262,196) (138,595) 4,435 (119,641) (52,747) (172,388)	Pro forma adjustments RMB’000 RMB’000 (Note 8) (Note 9) (1,001) 1,219,395 – – 12 – – – (16,903) – – – – – – (1,219,395) – – – – (17,892) – (1,375) – – – – – 84 – – – 22,619 – – – 3,436 – 251 – 3,687 –	Unaudited Pro Forma Remaining Group for the year ended 30 June 2016 RMB’000 1,135,430 (7,038) (44,540) 83,148 162,967 86 1,538 (1,219,395) 7,509 (306) 119,399 68,381 (34,224) 31,770 72,206 (262,196) (115,976) 4,435 (116,205) (52,496) (168,701)

– IV-6 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

UNAUDITED PRO FORMA STATEMENT OF CASH FLOWS (CONTINUED)

CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from disposal of items of property, plant and equipment Purchases of items of property, plant and equipment Deposit paid for purchase of land and buildings Purchases of items of intangible assets Decrease in investment in principal guaranteed deposits Interest received Dividends received Decrease in non-pledged time deposits with original maturity of more than three months when acquired Disposal of a subsidiary Net cash inflow from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Net proceeds from bank loans Interest paid Repayment of bank loans Repayment of bonds Purchase of treasury shares Dividends paid Distribution to non-controlling shareholders of subsidiaries Net cash flows used in financing activities NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS Cash and cash equivalents at beginning of period Effect of foreign exchange rate changes, net CASH AND CASH EQUIVALENTS AT END OF PERIOD ANALYSIS OF BALANCES OF CASH AND CASH EQUIVALENTS Cash and bank balances Non-pledged time deposits with original maturity of less than three months when acquired Cash and cash equivalents	The Group for the year ended 30 June 2016 RMB’000 (Note 1) 503 (159,760) (112,345) (248) 325,500 38,549 21,122 167,409 – 280,730 99,291 (83,149) (102,993) (79,152) (18,077) (26,723) (3,826) (214,629) (106,287) 980,899 377 874,989 755,200 119,789 874,989	Pro forma adjustments RMB’000 RMB’000 (Note 8) (Note 9) – – – – – – – – – – (12) – – – – – – 2,320,000 (12) 2,320,000 – – – – – – – – – – – – – – – – 3,675 2,320,000 (4,560) – – – (885) 2,320,000 (885) 2,320,000 – – (885) 2,320,000	Unaudited Pro Forma Remaining Group for the year ended 30 June 2016 RMB’000 503 (159,760) (112,345) (248) 325,500 38,537 21,122 167,409 2,320,000 2,600,718 99,291 (83,149) (102,993) (79,152) (18,077) (26,723) (3,826) (214,629) 2,217,388 976,339 377 3,194,104 3,074,315 119,789 3,194,104

– IV-7 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

Notes to Unaudited Pro Forma Financial Information of the Remaining Group

(1) The consolidated statement of financial position of the Group as at 30 June 2016, the consolidated statement of profit or loss, the consolidated statement of comprehensive income and the consolidated statement of cash flows of the Group for the six-month ended 30 June 2016 are extracted from the interim report of the Company for the six-month ended 30 June 2016.
(2) These adjustments represent the exclusion of assets and liabilities of the Disposal Company as at 30 June 2016, assuming the Disposal had taken place on 30 June 2016. The assets and liabilities of the Disposal Company as at 30 June 2016 are extracted from the unaudited financial information of the Disposal Company as set out in Appendix III of the Circular.
(3) These adjustments represent the exclusion of the consolidated adjustments of the Group relating to (i) investment cost in the Disposal Company by the Group and the issued capital and reserves recorded by the Disposal Company; and (ii) intercompany balances due from/to between the Disposal Company and the Remaining Group as at 30 June 2016.
(4) These adjustments represent:
(i) the Equity Consideration A and Loan Consideration in aggregate amount of RMB2.32 billion without taking into account the Equity Consideration B and Equity Consideration C.
(ii) the estimated net gain on the Disposal as if the Disposal had taken place on 30 June 2016, which is as follows:

Consideration:
Equity Consideration A
Loan Consideration
Net assets of the Disposal Company:
Net assets of the Disposal Company as at 30 June 2016
Transfer of the shareholder’s loan as at 30 June 2016 payable by the
Disposal Company to the Remaining Group
Estimated professional fees directly attributable to the Disposal
Estimated store closure expenses arising from the Disposal*
Estimated gain (before tax) on disposal
Estimated income tax in relation to the Disposal
Estimated gain (net of tax) on the Disposal

RMB’000
1,670,259
649,741
2,320,000
407,330
647,742
1,055,072
(14,000)
(9,626)
(23,626)
1,241,302
(319,000)
922,302

A department store that has been operating in the Disposed Property will be closed as a result of the Disposal.
(5) These adjustments represent the exclusion of the results of the Disposal Company for the six-month period ended 30 June 2016, which are extracted from the unaudited financial information of the Disposal Company for the six-month period ended 30 June 2016 set out in Appendix III of the Circular, assuming the Disposal had taken place on 1 January 2016.
(6) These adjustments represent the exclusion of intercompany transactions to reflect the actual results of the Remaining Group for the six-month period ended 30 June 2016.

– IV-8 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

Notes to Unaudited Pro Forma Financial Information of the Remaining Group (continued)

(7) The adjustments represent:
(i) the consideration for the Disposal amounting to RMB2.32 billion, details of which are shown in note (4)(i).
(ii) the estimated net gain on the Disposal as if the Disposal had taken place on 1 January 2016, which is as follows:

Consideration:
Equity consideration A
Loan consideration
Net assets of the Disposal Company:
Net assets of the Disposal Company as at 1 January 2016
Transfer of the shareholder’s loan as at 1 January 2016 payable by the
Disposal Company to the Remaining Group
Estimated professional fees directly attributable to the Disposal
Estimated store closure expenses arising from the Disposal*
Estimated gain (before tax) on disposal
Estimated income tax in relation to the Disposal
Estimated gain (net of tax) on the Disposal

RMB’000
1,670,259
649,741
2,320,000
406,618
670,361
1,076,979
(14,000)
(9,626)
(23,626)
1,219,395
(319,000)
900,395

A department store that has been operating in the Disposed Property will be closed as a result of the Disposal.
(8) These adjustments represent the exclusion of the cash flows of the Disposal Company which are extracted from the unaudited financial information of the Disposal Company for the six-month period ended 30 June 2016 as set out in Appendix III to the Circular, assuming the Disposal had taken place on 1 January 2016.
(9) The adjustment to cash and cash equivalents at end of the period is represented by:

RMB’000 Cash received from the Disposal 2,320,000

(10) The adjustments in respect of the unaudited pro forma statement of profit of loss, unaudited pro forma statement of comprehensive income and unaudited pro forma statement of cash flows above are not expected to have a continuing effect on the Remaining Group.

– IV-9 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

B. INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION

The following is the text of a report received from the reporting accountants of the Company, Ernst & Young, Certified Public Accountants, Hong Kong, for the purpose of incorporation in this circular.

To the Directors of Parkson Retail Group Limited

We have completed our assurance engagement to report on the compilation of unaudited pro forma financial information of Parkson Retail Group Limited (the “Company”) and its subsidiaries (hereinafter collectively referred to as the “Group”) by the directors of the Company (the “Directors”) for illustrative purposes only. The unaudited pro forma financial information consists of the unaudited pro forma statement of financial position as at 30 June 2016, unaudited pro forma statement of profit or loss, unaudited pro forma statement of comprehensive income and unaudited pro forma statement of cash flows for the six-month period ended 30 June 2016 and related notes as set out in Appendix IV to the circular dated 1 November 2016 (the “Circular”) issued by the Company (the “Unaudited Pro Forma Financial Information”). The applicable criteria on the basis of which the Directors have compiled the Unaudited Pro Forma Financial Information are described in the relevant notes.

The Unaudited Pro Forma Financial Information has been compiled by the Directors to illustrate the impact of the Disposal (as defined in the Circular) on the Group’s financial position as at 30 June 2016 as if the Disposal had taken place on 30 June 2016, and the Group’s financial performance and cash flows for the six-month period ended 30 June 2016 as if the Disposal had taken place on 1 January 2016. As part of this process, information about the Group’s financial position as at 30 June 2016, the Group’s financial performance and cash flows for the six-month period ended 30 June 2016 have been extracted by the Directors from the Group’s unaudited consolidated financial statements for the six-month period ended 30 June 2016, on which a review report has been published.

Directors’ responsibility for the Unaudited Pro Forma Financial Information

The Directors are responsible for compiling the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) and with reference to Accounting Guideline (“AG”) 7 Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants (the “HKICPA”).

Our independence and quality control

We have complied with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior.

– IV-10 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

Our firm applies Hong Kong Standard on Quality Control 1 Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements , and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

Reporting accountants’ responsibilities

Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the Unaudited Pro Forma Financial Information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the Unaudited Pro Forma Financial Information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements 3420 Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus issued by the HKICPA. This standard requires that the reporting accountants plan and perform procedures to obtain reasonable assurance about whether the Directors have compiled the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.

For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the Unaudited Pro Forma Financial Information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the Unaudited Pro Forma Financial Information.

The purpose of the Unaudited Pro Forma Financial Information included in the Circular is solely to illustrate the impact of the Disposal on unadjusted financial information of the Group as if the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the transaction would have been as presented.

A reasonable assurance engagement to report on whether the Unaudited Pro Forma Financial Information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the Directors in the compilation of the Unaudited Pro Forma Financial Information provide a reasonable basis for presenting the significant effects directly attributable to the transaction, and to obtain sufficient appropriate evidence about whether:

the related pro forma adjustments give appropriate effect to those criteria; and
the Unaudited Pro Forma Financial Information reflects the proper application of those adjustments to the unadjusted financial information.

– IV-11 –

UNAUDITED PRO FORMA FINANCIAL INFORMATION ON THE REMAINING GROUP

APPENDIX IV

The procedures selected depend on the reporting accountants’ judgment, having regard to the reporting accountants’ understanding of the nature of the Group, the transaction in respect of which the Unaudited Pro Forma Financial Information has been compiled, and other relevant engagement circumstances.

The engagement also involves evaluating the overall presentation of the Unaudited Pro Forma Financial Information.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion:

(a) the Unaudited Pro Forma Financial Information has been properly compiled on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purpose of the Unaudited Pro Forma Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

Yours faithfully,

Certified Public Accountants

Hong Kong

1 November 2016

– IV-12 –

VALUATION REPORT ON THE DISPOSAL PROPERTY

APPENDIX V

The following is the text of a letter and valuation certificate prepared for the purpose of incorporation in this circular received from DTZ Cushman & Wakefield Limited, an independent property valuer, in connection with its opinion of market value in existing state of the Disposal Property held by Beijing Huadesheng Property Management Co., Ltd. ( 北京華德盛物業管理有限公司 ) in the PRC as at 31 August 2016.

==> picture [199 x 59] intentionally omitted <==

16/F Jardine House 1 Connaught Place Central Hong Kong

1 November 2016

The Directors

Parkson Retail Group Limited Room 609, 6th Floor Harcourt House 39 Gloucester Road Wanchai Hong Kong

Dear Sirs,

Re: Beijing Sun Palace Parkson located at Building No. 1, Compound No. 12, Qi Sheng Middle Street, North-East of 3rd Ring Road, Chaoyang District, Beijing, the People’s Republic of China (中華人民共和國北京市朝陽區東北三環七聖中街12號院1號樓北京太陽宮百盛)

INSTRUCTIONS, PURPOSE & VALUATION DATE

In accordance with the instructions of Parkson Retail Group Limited (the “Company”) for us to carry out the valuation of the captioned property (“Disposal Property”) held by Beijing Huadesheng Property Management Co., Ltd. (北京華德盛物業管理有限公司) (“Disposal Company”), an indirect wholly-owned subsidiary of the Company, in the People’s Republic of China (the “PRC”), we confirm that we have carried out inspection, made relevant enquiries and obtained such further information as we considered necessary for the purpose of providing you with our opinion of the market value of the Disposal Property in existing state as at 31 August 2016 (the “valuation date”).

DEFINITION OF MARKET VALUE

Our valuation of the Disposal Property represent its Market Value. The definition of Market Value adopted in The HKIS Valuation Standards 2012 Edition follows the International Valuation Standards published by the International Valuation Standards Council (“IVSC”). Market Value is defined by the IVSC as “the estimated amount for which an asset or liability

– V-1 –

VALUATION REPORT ON THE DISPOSAL PROPERTY

APPENDIX V

should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing where the parties had each acted knowledgeably, prudently and without compulsion”.

VALUATION BASIS & ASSUMPTIONS

Our valuation of the Disposal Property excludes an estimated price inflated or deflated by special terms or circumstances such as atypical financing, special considerations or concessions granted by anyone associated with the sale, or any element of special value.

In the course of our valuation of the Disposal Property held in the PRC, with reference to the PRC Legal opinion of the legal adviser, 上海市建緯律師事務所 (Shanghai City Development Law Firm), dated 21 September 2016, we have prepared our valuation on the basis that transferable land use rights in respect of the Disposal Property for its specific term at nominal annual land use fee has been granted and that any premium payable has already been fully paid. We have relied on the information and advice given by the Disposal Company and the PRC legal opinion of the Company’s legal adviser, regarding the title to the Disposal Property and the interest in the Disposal Property. In valuing the Disposal Property, we have prepared our valuation on the basis that the owners have enforceable title to the Disposal Property and has free and uninterrupted rights to use, occupy or assign the Disposal Property for the whole of the unexpired terms as granted.

In respect of the Disposal Property situated in the PRC, the status of titles and grant of major certificates, approvals and licences, in accordance with the information provided by the Company, are set out in the notes in the valuation certificate.

No allowance has been made in our valuation for any charges, pledges or amounts owing on the Disposal Property nor any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is valued on the basis that the Disposal Property is free from encumbrances, restrictions and outgoings of any onerous nature which could affect its value.

METHOD OF VALUATION

In valuing the Disposal Property, we have valued the Disposal Property by Direct Comparison Approach by making reference to comparable sales evidences as available in the relevant market.

In valuing the Disposal Property, we have complied with the requirements set out in Chapter 5 and Practice Note 12 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and The HKIS Valuation Standards 2012 Edition published by the Hong Kong Institutes of Surveyors.

SOURCE OF INFORMATION

We have been provided by the Disposal Company with extracts of documents in relation to the title to the Disposal Property. However, we have not inspected the original documents to ascertain any amendments which may not appear on the copies handed to us.

– V-2 –

VALUATION REPORT ON THE DISPOSAL PROPERTY

APPENDIX V

In the course of our valuation, we have relied to a considerable extent on the information given by the Disposal Company in respect of the Disposal Property in the PRC and have accepted advice on such matters as planning approvals or statutory notices, easements, tenure, identification of land and buildings, completion date of building, number of car parking spaces, site and floor areas and all other relevant matters.

Dimensions, measurements and areas included in the valuation certificate are based on the information provided to us and are therefore only approximations. We have had no reason to doubt the truth and accuracy of the information provided to us by the Company which is material to the valuation. We were also advised by the Company that no material facts have been omitted from the information provided.

We would point out that the copies of documents provided to us are mainly compiled in Chinese characters and the transliteration into English represents our understanding of the contents. We would therefore advise the Company to make reference to the original Chinese edition of the documents and consult your legal adviser regarding the legality and interpretation of these documents.

TITLE INVESTIGATION

We have been provided with copies of documents in relation to the current title to the Disposal Property. However, we have not been able to conduct searches to verify the ownership of the Disposal Property or to ascertain any amendment which may not appear on the copies handed to us. We are also unable to ascertain the title of the Disposal Property in the PRC and we have therefore relied on the advice given by the PRC Legal adviser and the Disposal Company.

SITE INSPECTION

Our Beijing Office valuer, Kangni Chai, has inspected the exterior and, wherever possible, the interior of the Disposal Property in August 2016. However, no structural survey has been made, but in the course of our inspection, we did not note any serious defects. We are, however, not able to report that the Disposal Property is free of rot, infestation or any other structural defect and no tests have been carried out on any of the services. Our valuation is prepared on the assumption that these aspects are satisfactory.

Unless otherwise stated, we have not carried out on-site measurements to verify the site and floor areas of the Disposal Property and we have assumed that the areas shown on the copies of the documents handed to us are correct.

CURRENCY

Unless otherwise stated, all monetary amounts indicated herein our valuations are in Renminbi (RMB) which is the official currency of the PRC.

– V-3 –

VALUATION REPORT ON THE DISPOSAL PROPERTY

APPENDIX V

REMARKS

Please note that our Investment Department is acting as the sales agent of the Disposal Property. We have sought consent from the Company to carry out the valuation. The Company understands that our valuation is carried out independently on an impartial basis without bias to any party concerned.

We enclose herewith our valuation certificate.

Yours faithfully,

For and on behalf of

DTZ Cushman & Wakefield Limited

Philip C Y Tsang

Registered Professional Surveyor (General Practice) Registered China Real Estate Appraiser

MSc, MHKIS Director

Note: Mr. Philip C Y Tsang is Registered Professional Surveyor who has over 23 years’ experience in the valuation of properties in the PRC.

– V-4 –

VALUATION REPORT ON THE DISPOSAL PROPERTY

APPENDIX V

VALUATION CERTIFICATE

Disposal Property held for sale in the PRC

Disposal Property Description and tenure

Particulars of occupancy

Market value in existing state as at 31 August 2016

Beijing Sun Palace The Disposal Property comprises Parkson located at Beijing Sun Palace Parkson which is a Building No. 1, commercial development erected on a Compound No. 12, parcel of land with site area of Qi Sheng Middle approximately 13,813.41 square meters. Street, North-East of The Disposal Property comprises seven 3rd Ring Road, levels above ground for commercial use Chaoyang District, and three levels under ground which are Beijing, principally used as car parking spaces. the PRC The Disposal Property was completed in 2009 with gross floor area breakdown as (中國北京市朝陽區中國北京市朝陽區 follows:

(中國北京市朝陽區中國北京市朝陽區東北三環七聖中街 12號院1號樓北京太陽宮百盛)

The Disposal Property RMB2,013,000,000 is being used for department store operation. As advised, the Disposal Property will be handed over with vacant possession in due course.

Portion Retail (Level 1-7) Ancillary facility area Above ground sub-total 449 Car park spaces (Basement Level 1-3) Under ground sub-total Total	Approximate Gross Floor Area (square meters) 42,145.46 559.40
	42,704.86 19,975.70
	19,975.70
	62,680.56

The Disposal Property is located on Qi Sheng Middle Street, Chaoyang District, an area between the north east of 3rd Ring Road and 4th Ring Road in Beijing. According to the information provided by the Disposal Company, the Disposal Property is used as commercial building; there are no environmental issues or legal disputes; the Disposal Property will be handed over with vacant possession in due course.

The land use rights of the Disposal Property has been granted for a term of 40 years for commercial use due to expire on 30 August 2044 and 50 years for basement car park use due to expire on 30 August 2054.

– V-5 –

VALUATION REPORT ON THE DISPOSAL PROPERTY

APPENDIX V

Notes:

(1) According to Certificate for the Use of State-owned Land Jing Chao Guo Yong (2010) No. 00074 issued by Beijing Municipal Government dated 21 February 2010, the land use rights of the Disposal Property with site area of 13,814.41 sq m has been granted to Beijing Huadesheng Property Management Co., Ltd. (北京華德盛物業管理有限公司) (“Disposal Company”) for a term of 40 years for commercial use due to expire on 30 August 2044 and 50 years for basement car park use due to expire on 30 August 2054.
(2) According to 4 Building Ownership Certificates issued by Beijing Municipal Commission of Housing and Urban-rural Development dated 30 December 2009, the building ownership of the Disposal Property has been vested in Disposal Company with salient contents as follows:

No. Location Land Uses Jing Fang Quan Zheng Chao Zi No. 789529 Building No. 1, No. 12 Qi Sheng Middle Street, Chaoyang District Car Park, Composite Jing Fang Quan Zheng Chao Zi No. 789535 Unit -202, Building No. 1, No. 12 Qi Sheng Middle Street, Chaoyang District Jing Fang Quan Zheng Chao Zi No. 789531 Unit -203, Building No. 1, No. 12 Qi Sheng Middle Street, Chaoyang District Jing Fang Quan Zheng Chao Zi No. 789534 Unit -204, Building No. 1, No. 12 Qi Sheng Middle Street, Chaoyang District Total	Gross Floor Area (square meters) 62,121.16 238.65 103.15 217.60
	62,680.56

No.
Location
Land Uses
Jing Fang Quan Zheng Chao
Zi No. 789529
Building No. 1,
No. 12 Qi Sheng Middle Street,
Chaoyang District
Car Park, Composite
Jing Fang Quan Zheng Chao
Zi No. 789535
Unit -202, Building No. 1,
No. 12 Qi Sheng Middle Street,
Chaoyang District
Jing Fang Quan Zheng Chao
Zi No. 789531
Unit -203, Building No. 1,
No. 12 Qi Sheng Middle Street,
Chaoyang District
Jing Fang Quan Zheng Chao
Zi No. 789534
Unit -204, Building No. 1,
No. 12 Qi Sheng Middle Street,
Chaoyang District
Total

Gross Floor Area
(square meters)
62,121.16
238.65
103.15
217.60

62,680.56

(3) According to Business Licence Registration No. 110102011552252 dated 21 April 2015, Disposal Company was established with a registered capital of RMB400,000,000 for a valid operation period from 30 December 2008 to 29 December 2038.
(4) We have been provided with a Legal Opinion on the Disposal Property prepared by the Company’s PRC legal adviser, which contains, inter alia, the following information:–
(i) Disposal Company legally owns the land use rights and building ownership of the Disposal Property. During the term of the land use rights, Disposal Company is entitled to occupy, use, transfer, mortgage, lease or otherwise dispose of the Disposal Property;
(ii) The Disposal Property is not subject to any mortgage;
(iii) The Disposal Property will cease current operation and close on 31 October 2016 to complete the handover.
(5) The status of the title and grant of major approvals and licences in accordance with the information provided by the Company and the opinion of the PRC legal adviser:–

Certificate for the Use of State-owned Land Yes Building Ownership Certificate Yes Business Licence Yes

– V-6 –

GENERAL INFORMATION

APPENDIX VI

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular 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 document misleading.

2. INTERESTS OF DIRECTORS

(a) Interests in securities

As at the Latest Practicable Date, the interests and short positions of the Directors and the chief executive of the Company in the Shares, underlying Shares and/or debentures (as the case may be) of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which: (i) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions in which they were taken or deemed to have under such provisions of the SFO); or (ii) were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (iii) were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers under the Listing Rules, to be notified to the Company and the Stock Exchange, were as follows:

i. Long positions of Tan Sri Cheng Heng Jem in the share capital of the Company:

	Name of	Name of	Number and	Approximate
Nature of	registered	beneficial	class of	percentage of
interest	owner	owner	securities	shareholding
Corporate	PRG	PRG	1,438,300,000	54.29%
interest			ordinary
			shares
Corporate	East Crest	East Crest	9,970,000	0.37%
interest			ordinary
			shares

Note: Tan Sri Cheng Heng Jem, together with his spouse Puan Sri Chan Chau Ha alias Chan Chow Har, through their interest and a series of companies in which they have a substantial interest, are entitled to exercise or control the exercise of more than one-third of the voting power at the general meetings of PHB. Since PHB is entitled to exercise or control the exercise of 100% of the voting power at the general meeting of PRG through East Crest, pursuant to the SFO, he is deemed to be interested in both the 1,438,300,000 Shares held by PRG and the 9,970,000 Shares held by East Crest in the Company.

– VI-1 –

GENERAL INFORMATION

APPENDIX VI

ii. Long positions of Tan Sri Cheng Heng Jem in the share capital of the Company’s associated corporations (as defined in the SFO)

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Parkson Holdings	Beneficial	Tan Sri Cheng	Tan Sri Cheng	646,127,761	59.92% (based
Berhad (“PHB”)	interest	Heng Jem	Heng Jem	ordinary	on the capital
	and	together with	together with	shares	of PHB as at
	corporate	his spouse Chan	his spouse Chan		26/10/2016)
	interest	Chau Ha @	Chau Ha @
		Chan Chow Har	Chan Chow Har
		directly, and	directly, and
		through a series	through a series
		of controlled	of controlled
		corporations	corporations
East Crest	Corporate	PHB	PHB	1 ordinary	100%
	interest			share
Puncak Pelita Sdn	Corporate	PHB	PHB	2 ordinary	100%
Bhd	interest			shares
Parkson Properties	Corporate	PHB	PHB	2 ordinary	100%
Holdings	interest			shares
Co., Ltd.
Parkson Vietnam	Corporate	PHB	PHB	2 ordinary	100%
Investment	interest			shares
Holdings
Co., Ltd.
Prime Yield	Corporate	PHB	PHB	1 ordinary	100%
Holdings	interest			share
Limited
Corporate Code	Corporate	PHB	PHB	2 ordinary	100%
Sdn Bhd	interest			shares
PRG	Corporate	East Crest	East Crest	1 ordinary	100%
	interest			share
Smart Spectrum	Corporate	East Crest	East Crest	1 ordinary	100%
Limited	interest			share

– VI-2 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Park Avenue	Corporate	East Crest	East Crest	250,002	100%
Fashion Sdn.	interest			ordinary
Bhd.				shares
Serbadagang	Corporate	East Crest	East Crest	2 ordinary	100%
Holdings Sdn.	interest			shares
Bhd.
Parkson Retail	Beneficial	Tan Sri Cheng	Tan Sri Cheng	500,000	68.03% (in
Asia Limited	interest	Heng Jem	Heng Jem	ordinary	aggregate)
				shares
	Corporate	East Crest	East Crest	457,933,300
	interest			ordinary
				shares
Parkson Properties	Corporate	Parkson Properties	Parkson Properties	2 ordinary	100%
NDT (Emperor)	interest	Holdings	Holdings	shares
Co., Ltd.		Co., Ltd.	Co., Ltd.
Parkson Properties	Corporate	Parkson Properties	Parkson Properties	1 ordinary	100%
Hanoi Co., Ltd.	interest	Holdings	Holdings	share
		Co., Ltd.	Co., Ltd.
Parkson HCMC	Corporate	Parkson Vietnam	Parkson Vietnam	2 ordinary	100%
Holdings	interest	Investment	Investment	shares
Co., Ltd.		Holdings	Holdings
		Co., Ltd.	Co., Ltd.
Parkson Hai Phong	Corporate	Parkson Vietnam	Parkson Vietnam	2 ordinary	100%
Holdings	interest	Investment	Investment	shares
Co., Ltd.		Holdings	Holdings
		Co., Ltd.	Co., Ltd.
Parkson TSN	Corporate	Parkson Vietnam	Parkson Vietnam	2 ordinary	100%
Holdings	interest	Investment	Investment	shares
Co., Ltd.		Holdings	Holdings
		Co., Ltd.	Co., Ltd.

– VI-3 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Dyna Puncak Sdn	Corporate	Prime Yield	Prime Yield	2 ordinary	100%
Bhd	interest	Holdings	Holdings	shares
		Limited	Limited
Gema Binari Sdn.	Corporate	Prime Yield	Prime Yield	2 ordinary	100%
Bhd.	interest	Holdings	Holdings	shares
		Limited	Limited
Prestasi Serimas	Corporate	Prime Yield	Prime Yield	2,000,000	100%
Sdn Bhd	interest	Holdings	Holdings	ordinary
		Limited	Limited	shares
Parkson Credit	Corporate	Prime Yield	Prime Yield	2 ordinary	100%
Holdings Sdn	interest	Holdings	Holdings	shares
Bhd		Limited	Limited
AUM Hospitality	Corporate	Prime Yield	Prime Yield	60,000	60%
Sdn Bhd	interest	Holdings	Holdings	ordinary
		Limited	Limited	shares
Dalian Tianhe	Corporate	Serbadagang	Serbadagang	60,000,000	60%
Parkson	interest	Holdings Sdn.	Holdings Sdn.	registered
Shopping Centre		Bhd.	Bhd	capital
Co., Ltd.				(RMB)
Centro Retail	Corporate	Parkson Retail	Parkson Retail	3 ordinary	100%
Pte Ltd.	interest	Asia Limited	Asia Limited	shares
PT. Tozy Sentosa	Corporate	Parkson Retail	Parkson Retail	45,000	100% (in
	interest	Asia Limited	Asia Limited	common	aggregate)
				shares
		Centro Retail Pte	Centro Retail	5,000
		Ltd.	Pte Ltd.	common
				shares
Parkson	Corporate	Parkson Retail	Parkson Retail	50,000,002	100%
Corporation	interest	Asia Limited	Asia Limited	ordinary
Sdn. Bhd.				shares

– VI-4 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Parkson Myanmar	Corporate	Parkson Retail	Parkson Retail	2 ordinary	100%
Co., Pte. Ltd.	interest	Asia Limited	Asia Limited	shares
Parkson HBT	Corporate	Parkson TSN	Parkson TSN	2,100,000	100%
Properties	interest	Holdings	Holdings	capital
Co., Ltd.		Co., Ltd.	Co., Ltd.	(USD)
Idaman Erajuta	Corporate	Dyna Puncak Sdn	Dyna Puncak Sdn	2 ordinary	100%
Sdn. Bhd.	interest	Bhd	Bhd	shares
Magna Rimbun	Corporate	Dyna Puncak Sdn	Dyna Puncak Sdn	2 ordinary	100%
Sdn Bhd	interest	Bhd	Bhd	shares
True Excel	Corporate	Dyna Puncak Sdn	Dyna Puncak Sdn	1 ordinary	100%
Investments	interest	Bhd	Bhd	share
Limited
Parkson Branding	Corporate	Gema Binari Sdn.	Gema Binari Sdn.	7,000,000	100%
Sdn Bhd	interest	Bhd.	Bhd.	ordinary
				shares
Giftmate Sdn Bhd	Corporate	Gema Binari Sdn.	Gema Binari Sdn.	120,000	60%
	interest	Bhd.	Bhd.	ordinary
				shares
Parkson Credit	Corporate	Parkson Credit	Parkson Credit	30,000,000	100%
Sdn Bhd	interest	Holdings Sdn	Holdings Sdn	ordinary
		Bhd	Bhd	shares
Entity A Concepts	Corporate	AUM Hospitality	AUM Hospitality	2,000,000	100%
Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Entity B	Corporate	AUM Hospitality	AUM Hospitality	400,000	100%
Management	interest	Sdn Bhd	Sdn Bhd	ordinary
Sdn Bhd				shares
F & B Essentials	Corporate	AUM Hospitality	AUM Hospitality	100,000	100%
Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares

– VI-5 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Fantastic Red Sdn	Corporate	AUM Hospitality	AUM Hospitality	75,000	75%
Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
AUM Asiatic	Corporate	AUM Hospitality	AUM Hospitality	187,500	75%
Restaurants Sdn	interest	Sdn Bhd	Sdn Bhd	ordinary
Bhd				shares
Entity C Sdn Bhd	Corporate	AUM Hospitality	AUM Hospitality	100,000	100%
	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Parkson SGN	Corporate	Parkson	Parkson	4,500,000	100%
Co., Ltd.	interest	Corporation	Corporation	capital
		Sdn. Bhd.	Sdn. Bhd.	(USD)
Parkson Cambodia	Corporate	Parkson	Parkson	1 ordinary	100%
Holdings	interest	Corporation	Corporation	share
Co., Ltd.		Sdn. Bhd.	Sdn. Bhd.
Parkson	Corporate	Parkson	Parkson	700,000	70%
Edutainment	interest	Corporation	Corporation	ordinary
World Sdn Bhd		Sdn Bhd	Sdn Bhd	shares
Super Gem	Corporate	Parkson	Parkson	700,000	70%
Resources Sdn	interest	Corporation	Corporation	ordinary
Bhd		Sdn Bhd	Sdn Bhd	shares
Parkson Lifestyle	Corporate	Parkson	Parkson	5,000,000	100%
Sdn Bhd	interest	Corporation	Corporation	ordinary
		Sdn Bhd	Sdn Bhd	shares
Kiara Innovasi	Corporate	Parkson	Parkson	3,000,000	60%
Sdn. Bhd.	interest	Corporation	Corporation	ordinary
		Sdn. Bhd.	Sdn. Bhd.	shares
Parkson Online	Corporate	Parkson	Parkson	2,600,000	100%
Sdn Bhd	interest	Corporation	Corporation	ordinary
		Sdn. Bhd.	Sdn. Bhd.	shares

– VI-6 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Parkson Haiphong	Corporate	Parkson	Parkson	30,000,920	100%
Co., Ltd.	interest	Corporation	Corporation	capital
		Sdn. Bhd.	Sdn. Bhd.	(USD)
Parkson Unlimited	Corporate	Parkson	Parkson	1,000,000	100%
Beauty Sdn Bhd	interest	Corporation	Corporation	ordinary
		Sdn Bhd	Sdn Bhd	shares
Parkson Trends	Corporate	Parkson	Parkson	2,000,000	100%
Sdn Bhd	interest	Corporation	Corporation	ordinary
		Sdn Bhd	Sdn Bhd	shares
Max Outlet	Corporate	Parkson	Parkson	2 ordinary	100%
Sdn Bhd	interest	Corporation	Corporation	shares
		Sdn Bhd	Sdn Bhd
Parkson Trading	Corporate	Parkson	Parkson	300,000	100%
(Vietnam)	interest	Corporation	Corporation	capital
Company		Sdn. Bhd.	Sdn. Bhd.	(USD)
Limited
Solid Gatelink	Corporate	Parkson	Parkson	350,000	100%
Sdn. Bhd.	interest	Corporation	Corporation	ordinary
		Sdn. Bhd.	Sdn. Bhd.	shares
Parkson Vietnam	Corporate	Parkson	Parkson	10,340,000	100%
Co., Ltd.	interest	Corporation	Corporation	capital
		Sdn. Bhd.	Sdn. Bhd.	(USD)
Parkson Myanmar	Corporate	Parkson Myanmar	Parkson Myanmar	2,100,000	70%
Investment	interest	Co. Pte. Ltd.	Co. Pte. Ltd.	ordinary
Company				shares
Pte. Ltd.
Festival City	Corporate	Idaman Erajuta	Idaman Erajuta	500,000	100%
Sdn. Bhd.	interest	Sdn. Bhd.	Sdn. Bhd.	ordinary
				shares
Megan Mastika	Corporate	Magna Rimbun	Magna Rimbun	300,000	100%
Sdn. Bhd.	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares

– VI-7 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
True Excel	Corporate	True Excel	True Excel	1,000	100%
Investments	interest	Investments	Investments	ordinary
(Cambodia)		Limited	Limited	shares
Co., Ltd.
Parkson Fashion	Corporate	Parkson Branding	Parkson Branding	5,000,000	100%
Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Parkson Branding	Corporate	Parkson Branding	Parkson Branding	300,000	100%
(L) Limited	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Business Spirit	Corporate	Entity A Concepts	Entity A Concepts	2 ordinary	100%
Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	shares
J Rockets 1 Sdn	Corporate	Entity A Concepts	Entity A Concepts	350,000	100%
Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Massive Privilege	Corporate	Entity A Concepts	Entity A Concepts	300,000	100%
Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Urban Palette Sdn	Corporate	Entity A Concepts	Entity A Concepts	720,000	90%
Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
The Opera	Corporate	Entity A Concepts	Entity A Concepts	2,250,000	90%
Gastroclub Sdn	interest	Sdn Bhd	Sdn Bhd	ordinary
Bhd				shares
Genuine Resources	Corporate	AUM Asiatic	AUM Asiatic	1,000,000	100%
Sdn Bhd	interest	Restaurants Sdn	Restaurants Sdn	ordinary
		Bhd	Bhd	shares
Alunan Omega	Corporate	AUM Asiatic	AUM Asiatic	300,000	100%
Sdn Bhd	interest	Restaurants Sdn	Restaurants Sdn	ordinary
		Bhd	Bhd	shares

– VI-8 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Ombrello	Corporate	Entity C Sdn Bhd	Entity C Sdn Bhd	100	100%
Resources	interest			ordinary
Sdn Bhd				shares
Collective Entity	Corporate	Entity C Sdn Bhd	Entity C Sdn Bhd	300,000	60%
Sdn Bhd	interest			ordinary
				shares
Vertigo Dot My	Corporate	Entity C Sdn Bhd	Entity C Sdn Bhd	60,000	60%
Sdn Bhd	interest			ordinary
				shares
Parkson	Corporate	Parkson Cambodia	Parkson Cambodia	1,000	100%
(Cambodia)	interest	Holdings	Holdings	ordinary
Co., Ltd.		Co., Ltd.	Co., Ltd.	shares
Parkson Vietnam	Corporate	Parkson Vietnam	Parkson Vietnam	100,000	100%
Management	interest	Co., Ltd.	Co., Ltd.	capital
Services				(USD)
Co., Ltd.
Parkson Myanmar	Corporate	Parkson Myanmar	Parkson Myanmar	30,000	100%
Asia Pte. Ltd.	interest	Investment	Investment	ordinary
		Company	Company	shares
		Pte. Ltd.	Pte. Ltd.	(USD)
				1 ordinary
				share (SGD)
Myanmar Parkson	Corporate	Parkson Myanmar	Parkson Myanmar	270,000	100% (in
Company	interest	Investment	Investment	ordinary	aggregate)
Limited		Company	Company	shares
		Pte. Ltd.	Pte. Ltd.
		Parkson Myanmar	Parkson Myanmar	30,000
		Asia Pte. Ltd.	Asia Pte. Ltd.	ordinary
				shares

– VI-9 –

GENERAL INFORMATION

APPENDIX VI

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
Dimensi Andaman	Corporate	Megan Mastika	Megan Mastika	300,000	100%
Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary	(in aggregate)
				shares
				53,719,999
				redeemable
				convertible
				cumulative
				preference
				shares
Ohla Restaurant	Corporate	Vertigo Dot My	Vertigo Dot My	100	100%
Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Providence Club	Corporate	Vertigo Dot My	Vertigo Dot My	500,000	100%
KL Sdn Bhd	interest	Sdn Bhd	Sdn Bhd	ordinary
				shares
Parkson Yangon	Corporate	Parkson Myanmar	Parkson Myanmar	5,000	100%
Company	interest	Co., Pte. Ltd.	Co., Pte. Ltd.	ordinary	(in aggregate)
Limited				shares
		Parkson Retail	Parkson Retail	45,000
		Asia Limited	Asia Limited	ordinary
				shares

– VI-10 –

GENERAL INFORMATION

APPENDIX VI

iii. Short positions of Tan Sri Cheng Heng Jem in the share capital of the Company’s associated corporations (as defined in the SFO):

Name of				Number	Approximate
associated	Nature of	Name of	Name of	and class of	percentage of
corporation	interest	registered owner	beneficial owner	securities	shareholding
PHB	Corporate	Tan Sri Cheng	Tan Sri Cheng	40,000,142	3.70%
	interest	Heng Jem	Heng Jem	ordinary
		together with	together with	shares
		his spouse Chan	his spouse Chan
		Chau Ha @	Chau Ha @
		Chan Chow Har	Chan Chow Har
		directly, and	directly and
		through a series	through a series
		of controlled	of controlled
		corporations	corporations

iv. Long positions of Chong Sui Hiong in the share capital of the Company:

		Number and	Approximate
		class of	percentage of
Nature of interest	Subject matter	securities	shareholding
Beneficial interest	N/A	20,000	Less than 0.01%
		ordinary shares
Beneficial interest	Option to subscribe	375,000	Less than 0.02%
	for shares (note)	ordinary shares

Note: Offer was made on 27 November 2012 pursuant to the share option scheme adopted on 9 November 2005.
v. Long positions of Juliana Cheng San San in the share capital of the Company:

		Number and	Approximate
		class of	percentage of
Nature of interest	Subject matter	securities	shareholding
Beneficial interest	Option to subscribe	375,000	Less than 0.02%
	for shares (note)	ordinary shares

Note: Offer was made on 27 November 2012 pursuant to the share option scheme adopted on 9 November 2005.

– VI-11 –

GENERAL INFORMATION

APPENDIX VI

vi. Long positions of Ko Tak Fai, Desmond in the share capital of the Company:

		Number and	Approximate
		class of	percentage of
Nature of interest	Subject matter	securities	shareholding
Beneficial interest	Option to subscribe	75,000	Less than 0.01%
	for shares (note)	ordinary shares

Note: Offer was made on 27 November 2012 pursuant to the share option scheme adopted on 9 November 2005.

vii. Long positions of Yau Ming Kim, Robert in the share capital of the Company:

		Number and	Approximate
		class of	percentage of
Nature of interest	Subject matter	securities	shareholding
Beneficial interest	Option to subscribe	75,000	Less than 0.01%
	for shares (note)	ordinary shares

Note: Offer was made on 27 November 2012 pursuant to the share option scheme adopted on 9 November 2005.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or the chief executive of the Company had any interest or short positions in the Shares, underlying Shares and debentures of the Company and its associated corporations (within the meaning of Part XV of the SFO) which: (i) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions in which they were taken or deemed to have under such provisions of the SFO); or (ii) were required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (iii) were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers under the Listing Rules, to be notified to the Company and the Stock Exchange.

(b) Other interests

(i) As at the Latest Practicable Date, none of the Directors had any direct or indirect interest in any asset which had been acquired, or disposed of by, or leased to any member of the Group, or was proposed to be acquired, or disposed of by, or leased to any member of the Group since 31 December 2015, the date to which the latest published audited financial statements of the Group were made up.
(ii) As at the Latest Practicable Date, no contracts of significance to which the Company, its holding company, subsidiaries or fellow subsidiaries was a party and in which a Director had a material interest, whether directly or indirectly, except for the following connected transactions in which Tan Sri Cheng Heng Jem, an executive Director, had a material interest through the Connected Persons as listed in the table below:

– VI-12 –

GENERAL INFORMATION

APPENDIX VI

Type of contract	Connected Persons	Nature of the contracts
Deed of Non-	PHB	PHB grant to the Company
competition		a call option on PHB’s
		interest in their retail
		businesses in the PRC
		and an undertaking not to
		compete with the business
		of the Group in the PRC
		(details are set out in
		page 63 of the Company’s
		annual report for the
		financial year ended
		31 December 2015).
Trademark license	Smart Spectrum Limited	Smart Spectrum Limited
agreement	(novated by Parkson	(a wholly-owned
	Corporation Sdn. Bhd.)	subsidiary of PHB) grant
		to Shanghai Lion
		Investment (an indirect
		wholly-owned subsidiary
		of the Company) an
		exclusive license to use
		certain trademarks,
		including the “Parkson”
		and “Xtra” trademarks
		(details are set out in
		page 64 of the Company’s
		annual report for the
		financial year ended
		31 December 2015).
Joint Venture	AUM Hospitality Sdn. Bhd.	The Company has through a
Agreement	(AUMH”), which is 60%	wholly-owned subsidiary,
(“JV	held by a wholly-owned	Grand Parkson, entered
Agreement”)	subsidiary of PHB	into a JV Agreement with
		AUMH to establish a JV
		company for the purposes
		of developing its food
		and beverage business in
		China (details are set out
		in the announcement of
		the Company dated
		26 January 2015).

– VI-13 –

GENERAL INFORMATION

APPENDIX VI

3. INTERESTS OF SUBSTANTIAL SHAREHOLDERS

As at the Latest Practicable Date, so far as was known to any Director or the chief executive of the Company, the following persons (other than any Director or the chief executive of the Company) had an interest or short position in the Shares and underlying Shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group:

			Percentage of
			shareholding
		Number of	(direct or
Name of shareholder	Nature of interest	shares	indirect)
PHB	Corporate interest	1,448,270,000	54.66%
		(Note 3)
Puan Sri Chan Chau Ha	Interest of spouse	1,448,270,000	54.66%
alias Chan Chow Har		(Note 2)
PRG	Beneficial interest	1,438,300,000	54.29%
		(Note 3)
Wang Hung Roger	Beneficial interest, and	266,826,000	10.07%
	Trustee	(Note 4)
Wang Hsu Vivine H	Interest of spouse and	266,826,000	10.07%
	beneficiary of	(Note 5)
	a Trust
GEICO Holdings Limited	Corporate interest	256,546,846	9.68%
		(Note 6)
Golden Eagle International	Beneficial interest	256,546,846	9.68%
Retail Group Limited		(Note 6)
Wang Dorothy S L	Beneficiary of a Trust	256,546,846	9.68%
Wang Janice S Y	Beneficiary of a Trust	256,546,846	9.68%
Citigroup Inc.	Corporate interest	3,096,443	0.12%
		(Note 7)
	Corporate interest	2,865,500 (S)	0.11%
		(Note 7)
	Custodian	116,129,844	4.38%
	corporation/approved	(Note 7)
	lending agent
	Persons having a	45,663,000	1.72%
	security interest in	(Note 7)
	shares

– VI-14 –

GENERAL INFORMATION

APPENDIX VI

Notes:

All of the above are long positions, save that short positions are denoted by “S”.
Puan Sri Chan Chau Ha alias Chan Chow Har is the spouse of Tan Sri Cheng Heng Jem, an executive Director, and is deemed to be interested in 1,448,270,000 Shares which Tan Sri Cheng Heng Jem is deemed to be interested in for the purposes of the SFO.
PRG is a wholly-owned subsidiary of East Crest which in turn is wholly-owned by PHB. By virtue of the SFO, PHB is deemed to be interested in the Shares held by PRG in the Company.
The capacities of Wang Hung Roger in holding the 266,826,000 Shares (Long position) were as to 10,279,154 Shares (Long position) as beneficial owner and 256,546,846 Shares (Long position) as trustee.
Wang Hsu Vivine H is the spouse of Wang Hung Roger and is deemed to be interested in 266,826,000 Shares held by Wang Hung Roger.
Golden Eagle International Retail Group Limited is wholly-owned by GEICO Holdings Limited. By virtue of the SFO, GEICO Holdings Limited is deemed to be interested in the Shares held by Golden Eagle International Retail Group Limited in the Company.
According to the Form 2 (Corporate Substantial Shareholder Notice) filed by Citigroup Inc., its interest in the shares of the Company was held through a series of corporations controlled by it. In addition, Citigroup Inc. had a lending pool of 116,129,844 Shares.

As at the Latest Practicable Date, so far as the Directors are aware, each of the following persons, not being a Director of chief executive of the Company, was directly or indirectly interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of a member of the Group other than the Company:

		Percentage of
		equity interest
Substantial Shareholder	Member of the Group	held
Xinjiang Youhao (Note 1)	Xinjiang Parkson	49%
Wuxi Sunan (Note 2)	Wuxi Parkson	40%
Chongqing Wanyou (Note 3)	Chongqing Parkson	30%
Guizhou Shenqi Enterprise (Note 4)	Guizhou Parkson	40%
Shanghai Nine Sea Industry	Shanghai Lion Property	71%
	(Note 5)
Shanghai Nine Sea Industry	Shanghai Nine Sea	29%
	Parkson (Note 6)
Newcore Retail Hong Kong Limited	Parkson Newcore Retail	51%
	Shanghai Ltd
Mount Earnings Sdn. Bhd. (Note 7)	Yeehaw Best Practices	30%
	Sdn. Bhd.
Koh Wee Lit	Rite BOS Sdn Bhd	23.88%
Gee Cher Chiang	Rite BOS Sdn Bhd	16.67%
Bernice Cheong Nyuk Siew	Rite BOS Sdn Bhd	16.67%

– VI-15 –

GENERAL INFORMATION

APPENDIX VI

Notes:

Xinjiang Friendship (Group) Co., Ltd. (“Xinjiang Youhao”) owns 49% of the equity interest of Xinjiang Youhao Parkson Development Co., Ltd. (“Xinjiang Parkson”).
Wuxi Sunan Investment Guarantee Co., Ltd. (“Wuxi Sunan”) owns 40% of the equity interest of Wuxi Sanyang Parkson Plaza Co., Ltd. (“Wuxi Parkson”).
Chongqing Wanyou Economic Development Co., Ltd. (“Chongqing Wanyou”) owns 30% of the equity interest of Chongqing Wanyou Parkson Plaza Co., Ltd. (“Chongqing Parkson”).
(i) Guizhou Shenqi Enterprise owns 40% of the equity interest of Guizhou Shenqi Parkson Retail Development Co., Ltd. (“Guizhou Parkson”).
(ii) Zhang Pei, Zhang Zhi Jun and Zhang Ya own 30%, 40% and 30% of the equity interest in Guizhou Shenqi Enterprise, respectively, representing a 12%, 16% and 12% indirect equity interest in Guizhou Parkson.
Shanghai Nine Sea Lion Properties Management Co., Ltd. (“Shanghai Lion Property”) is a cooperative joint venture enterprise established under the laws of the PRC between Shanghai Nine Sea Industry Co., Ltd. (“Shanghai Nine Sea Industry”) and Exonbury Limited (“Exonbury”), a wholly-owned subsidiary of the Company. Shanghai Nine Sea Industry is entitled to 71% of the voting rights in the board of Shanghai Lion Property and 65% of its distributable profits. The Group is entitled to 29% of the voting rights in the board of Shanghai Lion Property and 35% of its distributable profits.
Shanghai Nine Sea Parkson Plaza Co., Ltd. (“Shanghai Nine Sea Parkson”) is a cooperative joint venture enterprise established under the laws of PRC between Shanghai Nine Sea Industry and Exonbury. Shanghai Nine Sea Industry is entitled to 29% of the voting rights in the board of Shanghai Nine Sea Parkson and a pre-determined distribution of income from Shanghai Nine Sea Parkson. The Group is entitled to 71% of the voting rights in the board of Shanghai Nine Sea Parkson and 100% of its distributable profit after deducting the aforesaid pre-determined distribution of income attributable to Shanghai Nine Sea Industry.
Gee Cher Chiang and Chia Chong Lun own 60% and 40% of the equity interest in Mount Earnings Sdn. Bhd. respectively, representing a 18% and 12% indirect equity interest in Yeehaw Best Practices Sdn. Bhd.

Save as disclosed above, as at the Latest Practicable Date, so far as was known to any Director or the chief executive of the Company, no persons (other than any Director or the chief executive of the Company) had an interest or short position in the Shares and underlying Shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group.

Tan Sri Cheng Heng Jem, an executive Director, is the Chairman and Managing Director of PHB, which is a company which has an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

– VI-16 –

GENERAL INFORMATION

APPENDIX VI

4. SERVICE CONTRACTS

As at the Latest Practicable Date:

(a) Tan Sri Cheng Heng Jem (an executive Director) entered into a letter of appointment with the Company in October 2014, pursuant to which he was appointed and he has agreed to act as an executive Director for: (i) a term of three years commencing from 9 November 2014; and (ii) an annual Director’s fee as stipulated in the letter of appointment (or such amount as adjusted by the Board from time to time). The annual Director’s fee payable by the Company to Tan Sri Cheng Heng Jem is HK$240,000.
(b) Juliana Cheng San San (an executive Director) entered into a letter of appointment with the Company in August 2015, pursuant to which she was appointed and she has agreed to act as an executive Director for: (i) a term of three years commencing from 28 August 2015; and (ii) an annual Director’s fee as stipulated in the letter of appointment (or such amount as adjusted by the Board from time to time). The annual Director’s fee payable by the Company to Juliana Cheng San San is HK$240,000.
(c) Dato Dr. Hou Kok Chung (a non-executive Director) entered into a letter of appointment with the Company in November 2014, pursuant to which he was appointed and has agreed to act as a non-executive Director for: (i) a term of three years commencing from 13 November 2014; and (ii) an annual Director’s fee as stipulated in the letter of appointment (or such amount as adjusted by the Board from time to time). The annual Director’s fee payable by the Company to Dato Dr. Hou Kok Chung is HK$240,000.

Save as disclosed above, none of the Directors have any existing or proposed service contracts with the Company or any member of the Group (excluding contracts expiring or which may be terminated by the Company or the relevant Group member within one year without payment of compensation other than statutory compensation).

5. COMPETING INTERESTS

As at the LPD, none of the Directors or the chief executive of the Company and their respective associates had any interest in any business which competes or is likely to compete, either directly or indirectly, with the business of the Group except for the indirect interests held by Tan Sri Cheng Heng Jem (through PHB) in Dalian Tianhe Parkson Shopping Centre Co., Ltd. (“ Dalian Tianhe Parkson ”) which owns one Parkson branded department store located in the Shahekou District, Dalian, Liaoning Province, the PRC (“ Dalian Tianhe Managed Store ”).

As at the Latest Practicable Date, Dalian Tianhe Managed Store carried on retail business which competed or is likely to compete, either directly or indirectly, with the business of the Group. Dalian Tianhe Managed Store is owned by Dalian Tianhe Parkson, a company in which PHB indirectly owned 60% of its equity interest as at the Latest Practicable Date.

– VI-17 –

GENERAL INFORMATION

APPENDIX VI

Since Tan Sri Cheng Heng Jem together with his spouse, holds more than 60% equity interest and therefore has control over PHB, Tan Sri Cheng Heng Jem is deemed to have interest in the business of Dalian Tianhe Managed Store which competes or is likely to compete, either directly or indirectly, with the business of the Group. The Company possessed an option/right of refusal to acquire Dalian Tianhe Managed Store as and when it deems fit.

6. LITIGATION

As at the LPD and save for the litigation of the Group as disclosed in the announcements of the Company dated 18 July 2016 and 21 July 2016 which is summarised below, so far as the Directors are aware, no member of the Group was engaged in any litigation or claim of material importance and no litigation or claim of material importance is known to the Directors to be pending or threatened by or against any member of the Group.

In the announcement of the Company dated 18 July 2016, it was disclosed that (i) Changshou Parkson Retail Development Co., Ltd. (常熟百盛商業發展有限公司) (“ Parkson Development ”) and (ii) Parkson Investment Holdings Co., Ltd. (金獅百盛投資有限公司) (“ Parkson Investment ”), both indirect wholly-owned subsidiaries of the Company established in the PRC, are involved in a litigation (the “ Litigation ”) under which (x) China Construction Bank Corporation, Changshou Branch (the “ Plaintiff ”) is the plaintiff and (y) Changshou Hang Lung Properties Co., Ltd. (常熟市恆隆置業有限公司) (the “ Landlord ”), Parkson Development, Parkson Investment and three other parties (collectively, “ Defendants* ”) are defendants.

As disclosed in the above announcement, Parkson Development has received (i) a notice of assistance in enforcement dated 14 July 2016 (the “ Enforcement Notice ”) issued by the Intermediate People’s Court of Suzhou, Jiangsu Province (江蘇省蘇州市中級人民法院) (the “ Court ”) together with (ii) a civil judgment dated 7 June 2016 (the “ Judgement* ”) issued by the Court in relation to a dispute in connection with a loan agreement.

According to the Judgement, among other things, (a) the Plaintiff had applied to the Court for an order on preservation of properties and requested that the bank deposits of the Defendants in the amount of RMB212,405,363, or an equivalent value of other assets, be frozen; and (b) the application of the Plaintiff described in (a) above was accepted by the Court which ordered that the bank deposits of the Defendants in the amount of RMB212,405,363, or an equivalent value of other assets, be frozen.

According to the Enforcement Notice, Parkson Development was requested to cease payment of rental for the premises located at the first floor underground and the five floors above ground of Hang Lung Centre, 106 Fangta Street, Changshou, Jiangsu (江蘇省常熟市方塔街106號恆隆中心地下一層至地上五層) which premises were occupied by Parkson Development as tenant whereas the Landlord is the landlord.

In the announcement of the Company dated 21 July 2016, it was disclosed that each of Parkson Development and Parkson Investment had submitted an application for review in relation to the Litigation to the Court, pursuant to which it applied for the revocation of the

– VI-18 –

GENERAL INFORMATION

APPENDIX VI

judgment on preservation of properties in relation to it. To the best of the Directors’ knowledge and belief having made all reasonable enquiries and as at the LPD, there had been no material development on the litigation as described above since the announcement of the Company dated 21 July 2016.

7. EXPERTS AND CONSENTS

Name

Qualification

Ernst & Young

Certified Public Accountants

DTZ Cushman & Wakefield Limited

Independent property valuer and professional surveyor

Shanghai City Development Law Firm (上海市建緯律師事務所)

PRC legal adviser

The above experts have given and have not withdrawn their written consents to the issue of the circular with the inclusion of their letters or opinions or advice and the references to their names in the form and context in which they appear.

As at the Latest Practicable Date, the above experts were not beneficially interested in the share capital of any member of the Group nor did they have any right, whether legally enforceable or not, to subscribe for or to nominate persons to subscribe for securities in any member of the Group nor did they have any interest, either direct or indirect, in any assets which have been, since 31 December 2015 (being the date to which the latest published audited financial statements of the Company were made up), acquired or disposed of by or leased to any member of the Group or are proposed to be acquired or disposed of by or leased to any member of the Group.

8. MATERIAL CONTRACTS

The following material contracts (not being contracts entered into in the ordinary and usual course of business) were entered into by members of the Group within the two years immediately preceding the date of this circular which are or may be material:

(a) the sales and purchase agreement dated 29 December 2014 in relation to the shopping complex located at No. 195, Hong Kong East Road, Laoshan District, Qingdao City, Shandong Province, PRC (“ Qingdao Shopping Mall ”) and entered into between (i) Shanghai Industrial Qingdao Development Co., Ltd. (上實發展(青島)投資開發有限公司) (“ Qingdao Vendor ”) as vendor and (ii) Qingdao Lion Plaza Retail Management Co., Ltd. (青島金獅廣場商業管理有限公司) (“ Qingdao Purchaser ”), a wholly-owned subsidiary of the Company, as purchaser whereby, among other things, the Qingdao Purchaser agreed to acquire the Qingdao Shopping Mall at the cash consideration of RMB1,422,320,000;

– VI-19 –

GENERAL INFORMATION

APPENDIX VI

(b) the agreement dated 15 July 2015 and entered into among (i) East Crest as vendor; (ii) Parkson Holdings Berhad as the vendor’s guarantor; (iii) Oroleon (Hong Kong) Limited (a wholly-owned subsidiary of the Company) as purchaser; and (iv) the Company as the purchaser’s guarantor whereby the purchaser agreed to acquire 457,933,300 ordinary shares in Parkson Retail Asia Limited from the vendor at the consideration of 228,508,716.70 Singapore dollars;
(c) the supplemental agreement dated 25 February 2016 and entered into between the Qingdao Vendor and the Qingdao Purchaser whereby, among other things, the Qingdao Purchaser agreed to acquire the title to the commercial portion of the Qingdao Shopping Mall at the cash consideration of RMB112,344,623;
(d) the EFA;
(e) the LFA;
(f) the Equity Transfer Agreement; and
(g) the Loan Transfer Agreement.

Save and except for East Crest and Parkson Holdings Berhad, who were the connected persons of the Company as at the date of the material contract set out in paragraph (b) above, each of the counterparties to the material contracts set out in this subsection were parties independent of, and connected with, the connected persons of the Company as the date of the relevant material contract(s).

9. GENERAL

(a) The registered office of the Company is situated at c/o M & C Corporate Services Limited, PO Box 309, Ugland House, South Church Street, George Town, Grand Cayman, Cayman Islands.
(b) The principal place of business of the Company in Hong Kong is at Room 609, 6th Floor, Harcourt House, 39 Gloucester Road, Wanchai, Hong Kong.
(c) The branch share registrar and transfer office of the Company in Hong Kong is Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong.
(d) The secretary of the Company is SENG SZE Ka Mee, Natalia FCS (PE), FCIS, MBA (Executive), FHKIoD, FTIHK.

– VI-20 –

GENERAL INFORMATION

APPENDIX VI

10. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at the office of the company secretary of the Company in Hong Kong at Level 54, Hopewell Centre, 183 Queen’s Road East, Hong Kong during normal business hours on any business day up to and including the date which is 14 days from the date of this circular:

(a) the memorandum and articles of association of the Company;
(b) the service contracts referred to in the section headed “Service Contracts” in this Appendix;
(c) the material contracts referred to in the section headed “Material Contracts” in this Appendix;
(d) the letter from the Board, the text of which is set out on pages 7 to 26 of this circular;
(e) financial information of the Disposal Company, the text of which is set out in Appendix III to this circular;
(f) the accountants’ report on the Unaudited Pro Forma Financial Information on the Remaining Group, the text of which is set out in Appendix IV to this circular;
(g) the valuation report prepared by DTZ Cushman & Wakefield Limited, the text of which is set out in Appendix V to this circular;
(h) the PRC legal opinion of Shanghai City Development Law Firm (上海市建緯律師事務所) referred to in the valuation report set out in Appendix V to this circular;
(i) the written consents from the experts referred to in the section headed “Experts and Consents” of this appendix;
(j) the annual report of the Company for each of the two financial years ended 31 December 2014 and 2015 respectively;
(k) the circular of the Company dated 24 March 2016; and
(l) this circular.

– VI-21 –

EGM NOTICE

PARKSON RETAIL GROUP LIMITED 百盛商業集團有限公司

(Incorporated in Cayman Islands with limited liability)

(Stock code: 03368 & 05936)

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the “ EGM ”) of Parkson Retail Group Limited (the “ Company ”) will be held at Lavender, Level 3, Three Pacific Place, 1 Queen’s Road East, Admiralty, Hong Kong on Thursday, 17 November 2016 at 3:00 p.m. for the purpose of considering and, if thought fit, passing with or without amendments, the following resolution of the Company:

ORDINARY RESOLUTION

“THAT:

(a) the equity transfer agreement dated 13 October 2016 and entered into between (i) Parkson Retail Development Co., Ltd. (百盛商業發展有限公司) (the “ Vendor ”); (ii) the Company; (iii) Shenzhen Qianhai Tulan Investment Centre (LLP) (深圳前海圖藍投資中心(有限合夥)) (“ Purchaser A ”); (iv) Shanghai Changkun Investment Management Co. Ltd. (上海長昆投資管理有限公司) (“ Purchaser B ”); and (v) ZRiver Capital Investment Management Limited (中融長河資本投資管理有限公司) (“ Purchasers Parent ”), pursuant to which, among other things, the Vendor shall sell and Purchaser A and Purchaser B shall purchase the entire equity interests of Beijing Huadesheng Property Management Co., Ltd. (北京華德盛物業管理有限公司) (the “ Disposal Company* ”) (a copy of which has been produced before the Meeting marked “A” and initialled by the chairperson of the Meeting for the purpose of identification) and the transactions provided or contemplated thereunder be and are hereby approved, confirmed and ratified in all respects;
(b) the loan transfer agreement dated 13 October 2016 and entered into between (i) the Vendor; (ii) the Company; (iii) the Disposal Company; (iv) Purchaser A; and (v) the Purchasers Parent, pursuant to which, among other things, the Vendor shall sell and Purchaser A shall purchase the shareholder’s loan and other monies in the aggregate amount of RMB649,741,101.64 as at 31 July 2016 owed or otherwise payable by the Disposal Company to the Vendor and its related parties after deduction of the monies payable by the Vendor to the Disposal Company (a copy of which has been produced before the Meeting marked “B” and initialled by the chairperson of the Meeting for the purpose of identification) and the transactions provided or contemplated thereunder be and are hereby approved, confirmed and ratified in all respects; and

– EGM-1 –

EGM NOTICE

(c) the directors of the Company be and are hereby authorised for and on behalf of the Company to sign, execute, perfect, perform and deliver all such other agreements, instruments, deeds and documents and do all such acts or things and take all such steps as they may in their absolute discretion consider to be necessary, desirable, appropriate or expedient to implement or give effect to or otherwise in connection with or incidental to the agreements referred to in paragraphs (a) and (b) above and all the transactions contemplated thereunder and to agree to such variations, amendments or waivers as are, in the opinion of the directors of the Company, in the interests of the Company and its shareholders.”

PARKSON RETAIL GROUP LIMITED Tan Sri Cheng Heng Jem Executive Director & Chairman

1 November 2016

Notes:

The register of members of the Company will be closed from Wednesday, 16 November 2016 to Thursday, 17 November 2016, both days inclusive, during which period no transfer of Shares can be registered. In order to qualify for attending and voting at the EGM, all transfer forms accompanied by the relevant share certificates must be lodged for registration with the Company’s branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong, not later than 4:30 p.m. on Tuesday, 15 November 2016.
All resolutions at the meeting will be taken by poll pursuant to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “ Listing Rules ”) and the results of the poll will be published on the websites of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) and of the Company (www.parksongroup.com.cn).
A member entitled to attend and vote at the EGM is entitled to appoint one or, if he holds two or more Shares, more proxies to attend and vote on his behalf. A proxy needs not be a member of the Company.
In order to be valid, a form of proxy, together with any power of attorney or other authority, if any, under which it is signed, or a notarially certified copy thereof, must be deposited at the Company’s branch share registrar in Hong Kong, Tricor Investor Services Limited, at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time appointed for holding the EGM or any adjourned meeting (as the case may be). Completion and return of the form of proxy will not preclude a member from attending and voting in person.
A form of proxy for use in connection with the Extraordinary General Meeting is enclosed and such form is also published on the websites of Hong Kong Exchanges and Clearing Limited (www.hkexnews.hk) and of the Company (www.parksongroup.com.cn).
If two or more persons are joint holders of a Share, the vote of the senior who tenders a vote, whether in person or by proxy, will be accepted to the exclusion of the other joint holder(s). For this purpose, seniority shall be determined by the order in which the names stand in the principal or branch register of members of the Company in respect of the joint holding.

As at the date of this notice, the Executive Directors are Tan Sri Cheng Heng Jem, Mr. Chong Sui Hiong and Ms. Juliana Cheng San San, the Non-executive Director is Dato’ Dr. Hou Kok Chung and the Independent Non-executive Directors are Dato’ Fu Ah Kiow, Mr. Ko Tak Fai, Desmond and Mr. Yau Ming Kim, Robert.

– EGM-2 –

AI assistant

Parkson Retail Group Limited — Proxy Solicitation & Information Statement 2016

50826_rns_2016-10-31_3689185c-806e-4d99-ab34-fe8332b5947d.pdf

PARKSON RETAIL GROUP LIMITED 百盛商業集團有限公司

VERY SUBSTANTIAL DISPOSAL:

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

DEFINITIONS

PARKSON RETAIL GROUP LIMITED 百盛商業集團有限公司

Registered office:

Independent Non-Executive Directors:

To the Shareholders

VERY SUBSTANTIAL DISPOSAL:

DISPOSAL OF THE ENTIRE EQUITY INTERESTS IN BEIJING HUADESHENG PROPERTY MANAGEMENT CO., LTD (北京華德盛物業管理有限公司), A WHOLLY-OWNED PRC SUBSIDIARY AND THE RELEVANT SHAREHOLDER’S LOAN

1. INTRODUCTION

2. THE EQUITY TRANSFER AGREEMENT

(a) Date

(b) Parties

(c) Assets to be disposed of

(d) Total Equity Consideration and basis of its determination

(i) The Total Equity Consideration

(ii) Further information on the Refunded Taxes

(e) Equity Deposit

(f) Payment schedule of the Total Equity Consideration

(i) Payments to the Equity Escrow Account

(ii) Release of monies from the Equity Escrow Account to the bank account designated by the Vendor

(iii) Payments of Equity Consideration C

(g) Equity Conditions

(h) Fulfilment (or waiver) of the Equity Conditions and consequences if the Equity Conditions are not fulfilled (or waived)

(i) Approval Condition

(ii) No Breach by Vendor Condition

(iii) No Breach by Purchasers Condition

(iv) Loan Condition (I)

(i) Equity Completion

(j) The Loan Transfer Agreement

(k) Representations and warranties

(l) Detailed terms and handover of the Disposal Property

(m) Guarantees on performance of the transaction documents

(n) Exercise of the rights, and performance of the obligations, of the Purchasers by Purchaser A

(o) Default

3. THE LOAN TRANSFER AGREEMENT

(a) Date

(b) Parties

(c) Assets to be disposed of

(d) The Loan Consideration and basis of its determination

(e) Loan Deposit

(f) Payment schedule of the Loan Consideration

(i) Payments to the Loan Escrow Account

(ii) Release of monies from the Loan Escrow Account to the bank account designated by the Vendor

(g) Loan Conditions

(h) Fulfilment (or waiver) of the Loan Conditions and consequences if the Loan Conditions are not fulfilled (or waived)

(i) Loan Condition (I)

(ii) Loan Condition (II)

(i) Loan Completion

(j) Termination of the Loan Transfer Agreement

(k) Guarantees on performance of the transaction documents

(l) Default

4. INFORMATION ON THE DISPOSAL COMPANY

5. INFORMATION ON THE DISPOSAL PROPERTY

6. INFORMATION ON THE GROUP AND THE VENDOR

7. INFORMATION ON THE PURCHASERS AND THE PURCHASERS PARENT

(a) Further information on determination of the Total Consideration

(b) Gain expected to accrue to the Group

9. USE OF PROCEEDS FROM THE DISPOSAL

10. SIGNIFICANT FINANCIAL EFFECTS OF THE DISPOSAL ON THE GROUP

Assets and liabilities

Earnings

Gearing

11. REASONS AND BENEFITS FOR ENTERING INTO THE TRANSACTIONS

12. IMPLICATIONS UNDER LISTING RULES

13. EGM

14. VOTING RECOMMENDATION

15. ADDITIONAL INFORMATION

Parkson Retail Group Limited Tan Sri Cheng Heng Jem Executive Director & Chairman

AUDITED FINANCIAL INFORMATION OF THE GROUP FOR THE LAST THREE FINANCIAL YEARS

UNAUDITED FINANCIAL INFORMATION OF THE GROUP FOR THE SIX MONTHS ENDED 30 JUNE 2016

INDEBTEDNESS

(a) Bank loans

Parkson Retail Group Limited Proxy Solicitation & Information Statement 2016