Symphony Holdings Limited - M&A Activity 2013

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

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新灃集團有限公司*

(Incorporated in Bermuda with limited liability) (Stock Code: 01223)

MAJOR TRANSACTIONS IN RELATION TO (1) ACQUISITION OF 50% EQUITY INTEREST IN CHINA OCEAN RESOURCES LIMITED; AND (2) DISPOSAL OF 18.32% EQUITY INTEREST IN GRAND WEALTH GROUP LIMITED;

AND

DISCLOSEABLE TRANSACTION IN RELATION TO DISPOSAL OF TRADEMARKS

THE ACQUISITION

After the Stock Exchange trading hours on 27 March 2013, Power Plus and Canstrong entered into the Acquisition Agreement, pursuant to which Power Plus has conditionally agreed to purchase and Canstrong has conditionally agreed to sell the China Ocean Sale Shares and the China Ocean Sale Loan for an aggregate consideration of US$15.5 million (equivalent to approximately HK$120.3 million). The China Ocean Sale Shares, being 5 shares of US$1.00 in the issued share capital of China Ocean, represent 50% of the existing issued share capital of China Ocean as at the date of the Acquisition Agreement.

THE DISPOSAL

After the Stock Exchange trading hours on 27 March 2013, Power Plus and Canstrong also entered into the Disposal Agreement, pursuant to which Power Plus has conditionally agreed to sell and Canstrong has conditionally agreed to purchase the Grand Wealth Sale Shares and the Grand Wealth Sale Loan for an aggregate consideration of US$15.53 million (equivalent to approximately HK$120.5 million). The Grand Wealth

* For identification purpose only

Sale Shares, being 5,000 ordinary shares of US$10.00 each and 2,160 preferred shares of US$5,000.00 each in the issued share capital of Grand Wealth, represent 50% and 18% of the ordinary and preferred shares in the issued share capital of Grand Wealth respectively as at the date of the Disposal Agreement.

THE TRANSFER

After the Stock Exchange trading hours on 27 March 2013, Always Gain and Dream Smart entered into the Trademark Agreement, pursuant to which, amongst other things:-

(i) Always Gain will sell and transfer to Dream Smart all of its right, title and interest in and to the Transferred Trademarks and the Domain Names for a consideration of US$5 million (equivalent to approximately HK$38.8 million);
(ii) Dream Smart agrees that its use of the Transferred Trademarks shall be limited to sales, offers for sale and uses solely within the PRC and Taiwan;
(iii) Dream Smart grants an exclusive, royalty-free, fully-paid, perpetual, sublicenseable right and license to Always Gain to use the Transferred Trademarks in and throughout the PRC and Taiwan solely for the purposes of manufacturing products to be sold exclusively outside of the PRC and Taiwan; and
(iv) Dream Smart shall be responsible, as of the Registration Date, for the protection, acquisition, maintenance and prosecution of the Transferred Trademarks and any costs associated therewith.

LISTING RULES IMPLICATIONS

Each of the Acquisition and the Disposal constitutes a major transaction for the Company under Chapter 14 of the Listing Rules and is subject to the approval of the Shareholders by way of poll. The Transfer constitutes a discloseable transaction for the Company under the Listing Rules. The SGM will be convened and held for the purpose of considering and, if thought fit, approving the resolutions in respect of the Acquisition and the Disposal.

Frensham, an indirect wholly-owned subsidiary of Yue Yuen and a fellow subsidiary of Canstrong, holds 62,999,572 Shares, representing approximately 4.82% of the issued share capital of the Company. Frensham holds a 40% interest in Well Success. Frensham also holds a 6.67% interest in First Dynamic International Limited which in turn holds a 40% interest in Well Success. Well Success is the controlling Shareholder holding 664,677,468 Shares, representing approximately 50.81% of the issued share capital of the Company as at the date of this announcement. Accordingly, Canstrong and its associates (including Frensham and Well Success) shall abstain from voting at the SGM.

GENERAL

A circular containing, among other things, details of the Acquisition Agreement and the Disposal Agreement, financial information of the Group, the accountants’ report of China Ocean, a notice convening the SGM and other information as required under the Listing Rules will be despatched to the Shareholders on or before 3 May 2013 so as to allow sufficient time for the preparation of the relevant information for inclusion in the circular.

THE ACQUISITION AGREEMENT

Date:

27 March 2013

Parties:

(i) Canstrong, as seller; and
(ii) Power Plus, as purchaser.

Assets to be acquired:

Pursuant to the Acquisition Agreement, Power Plus has conditionally agreed to purchase and Canstrong has conditionally agreed to sell the China Ocean Sale Shares and the China Ocean Sale Loan. The China Ocean Sale Shares, being 5 shares of US$1.00 in the issued share capital of China Ocean, represent 50% of the existing issued share capital of China Ocean as at the date of the Acquisition Agreement. For further details of China Ocean, please refer to the paragraph headed “Information on China Ocean” below.

Consideration:

The aggregate consideration for the China Ocean Sale Shares and the China Ocean Sale Loan of US$15.5 million (equivalent to approximately HK$120.3 million) shall be payable in cash by Power Plus to Canstrong at China Ocean Closing.

The consideration was determined after arm’s length negotiations between Power Plus and Canstrong with reference to the consolidated net asset value of the China Ocean Group of approximately HK$14.6 million and the aggregate amount of shareholders’ loan of approximately HK$220.6 million outstanding as at 31 December 2012.

Conditions of the Acquisition:

The Acquisition shall be conditional upon:

(i) approval by the Independent Shareholders of the Acquisition Agreement and the transactions contemplated thereby for the purposes of Chapter 14 of the Listing Rules; and
(ii) completion of the Disposal Agreement

China Ocean Closing:

China Ocean Closing shall take place on the 5[th] Business Day after satisfaction of the above conditions or at such other time as Power Plus and Canstrong shall mutually agree in writing.

Termination:

The Acquisition Agreement may be terminated at any time prior to China Ocean Closing (i) by either party to the Acquisition Agreement if the China Ocean Closing shall not have occurred before or on the 120[th] day after the Acquisition Agreement; or (ii) by the written consent of the parties to the Acquisition Agreement. In the event that the Acquisition Agreement is terminated, the Acquisition Agreement shall forthwith become void and there shall be no further liability on the part of either party, but nothing therein shall relieve either party from liability for any breach of the Acquisition Agreement occurring prior to such termination.

THE DISPOSAL AGREEMENT

Date:

27 March 2013

Parties:

(i) Power Plus, as seller; and
(ii) Canstrong, as purchaser.

Assets to be disposed of:

Pursuant to the Disposal Agreement, Power Plus has conditionally agreed to sell and Canstrong has conditionally agreed to purchase the Grand Wealth Sale Shares and the Grand Wealth Sale Loan. The Grand Wealth Sale Shares, being 5,000 ordinary shares of US$10.00 each and 2,160 preferred shares of US$5,000.00 each in the issued share capital of Grand Wealth, represent 50% and 18% of the ordinary and preferred shares in the issued share capital of Grand Wealth respectively as at the date of the Disposal Agreement. For further details of Grand Wealth, please refer to the paragraph headed “Information on Grand Wealth” below.

Consideration:

The aggregate consideration for the Grand Wealth Sale Shares and the Grand Wealth Sale Loan of US$15.53 million (equivalent to approximately HK$120.5 million) shall be payable in cash by Canstrong to Power Plus at Grand Wealth Closing.

The consideration was determined after arm’s length negotiations between Power Plus and Canstrong with reference to the carrying value of the Group’s investment in Grand Wealth of approximately HK$29.1 million and the aggregate amount of shareholders’ loan owed to Power Plus of approximately HK$91.3 million outstanding as at 31 December 2012.

Conditions of the Disposal:

The Disposal shall be conditional upon:

(i) approval by the Independent Shareholders of the Disposal Agreement and the transactions contemplated thereby for the purposes of Chapter 14 of the Listing Rules; and
(ii) completion of the Acquisition Agreement.

Grand Wealth Closing:

Grand Wealth Closing shall take place on the 5[th] Business Day after satisfaction of the above conditions or at such other time as Power Plus and Canstrong shall mutually agree in writing.

Termination:

The Disposal Agreement may be terminated at any time prior to Grand Wealth Closing (i) by the party to the Disposal Agreement if the Grand Wealth Closing shall not have occurred before or on the 120[th] day after the Disposal Agreement; or (ii) by the written consent of the parties to the Disposal Agreement. In the event that the Disposal Agreement is terminated, the Disposal Agreement shall forthwith become void and there shall be no further liability on the part of either party, but nothing therein shall relieve either party from liability for any breach of the Disposal Agreement occurring prior to such termination.

THE TRADEMARK AGREEMENT

Date:

27 March 2013

Parties:

(i) Always Gain, as seller; and
(ii) Dream Smart, as purchaser.

Dream Smart is an investee company of Prodigy Fund acquired by Prodigy Fund for the purpose of engaging in trademark and brand management. The principal business of Prodigy Fund is investment management. Each of Prodigy Fund and Treasure Bloom Properties Limited (an indirect wholly-owned subsidiary of the Company) is a 50% shareholder of Welcome Wealth which is in turn an associated company of the Group. Prodigy Fund is not a legal entity but it is a segregated portfolio and investment fund set up and run by Prodigy Asset Management (Cayman Islands) Co.. Save as aforesaid, to the best of the Directors’ knowledge, information and belief after making reasonable enquiries, Dream Smart and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons.

Principal terms:

Pursuant to the Trademark Agreement, amongst other things:-

(i) Always Gain will sell and transfer to Dream Smart all of its right, title and interest in and to the Transferred Trademarks and the Domain Names;
(ii) Dream Smart agrees that its use of the Transferred Trademarks shall be limited to sales, offers for sale and uses solely within the PRC and Taiwan;
(iii) Dream Smart grants an exclusive, royalty-free, fully-paid, perpetual, sublicenseable right and license to Always Gain to use the Transferred Trademarks in and throughout the PRC and Taiwan solely for the purposes of manufacturing products to be sold exclusively outside of the PRC and Taiwan; and
(iv) Dream Smart shall be responsible, as of the Registration Date, for the protection, acquisition, maintenance and prosecution of the Transferred Trademarks and any costs associated therewith.

For the avoidance of doubt, the Transferred Trademarks do not include the trademark, trade name or logo used or registered outside of the PRC and Taiwan.

Information on the Transferred Trademarks:

Set out below are details of the Transferred Trademarks:

(i) Trademarks registered in the PRC in the name of Always Gain

No.	Class	Registration number	Trademark	Next renewal date
1	25	1341097	Chevron Design	2019/12/06
2	25	1420270	PONY	2020/07/13
3	18	180830	PONY & Design (Chevron Design)	2013/07/04
4	25	180828	PONY & Design (Chevron Design)	2013/07/04
5	28	180829	PONY & Design (Chevron Design)	2013/07/04
6	16	4523598	`普尼`	2018/07/06
7	18	4345585	PONY	2018/08/06
8	35	4523600	`普尼`	2018/09/20
9	35	4399159	PONY	2021/03/20

(ii) Trademarks registered in Taiwan in the name of Always Gain

No.	Class	Registration number	Trademark	Next renewal date
1	44	193727	PONY & Design (Chevron Design)	2022/10/15
2	50	193957	PONY & Design (Chevron Design)	2022/10/15
3	86	195594	PONY & Design (Chevron Design)	2022/10/31
4	86	314410	PONY	2022/10/31
5	44	75596	PONY	2015/03/31
6	48	220536	PONY & Design (Chevron Design)	2015/03/31
7	48	75606	PONY	2015/03/31

The Transferred Trademarks are at present being used by Wisesport Limited, a company incorporated in the BVI and a direct wholly-owned subsidiary of Welcome Wealth. The revenue attributable to the Transferred Trademarks for the two financial years ended 31 December 2011 and 2012 were approximately HK$9.9 million and approximately HK$12.0 million respectively. The profit both before and after taxation attributable to the Transferred Trademarks for the two financial years ended 31 December 2011 and 2012 was approximately HK$4.4 million and approximately HK$2.8 million respectively.

Consideration:

The aggregate consideration for the Transferred Trademarks of US$5 million (equivalent to approximately HK$38.8 million) shall be payable in cash in the following manner:

(i) an initial payment of US$2.5 million (equivalent to approximately HK$19.4 million) (the “ Trademark Deposit ”) shall be payable by Dream Smart to Always Gain on or before the 15[th] Business Day after the execution of the Trademark Agreement; and
(ii) the remaining amount of US$2.5 million (equivalent to approximately HK$19.4 million) shall be payable by Dream Smart to Always Gain on or before the 7[th] Business Day after the Registration Date.

The consideration was determined after arm’s length negotiations between Always Gain and Dream Smart with reference to the carrying value of the Transferred Trademarks of approximately HK$23.3 million as at 31 December 2012.

Conditions of the Transfer:

The Transfer shall be conditional upon the fulfillment of condition(s) precedent of the Acquisition Agreement.

Termination:

If the Registration Date shall not have occurred before or on the 365 days after the Trademark Agreement (the “ Long Stop Date ”), the Trademark Agreement may be terminated by notice given at any time after the Long Stop Date by any party (except by a party whose failure to fulfill any obligation under the Trademark Agreement shall have been the cause of, or shall have resulted in Dream Smart or its nominee not being the registered owner of all of the Transferred Trademarks and Domain Names on or prior to the Long Stop Date). In the event of and notwithstanding such termination, Always Gain shall return the Trademark Deposit (without interest) to Dream Smart on or before the 5[th] Business Day after such notice.

INFORMATION ON CANSTRONG

Canstrong is a company incorporated in the BVI with limited liability and is principally engaged in investment holding. Canstrong is an indirect wholly-owned subsidiary of Yue Yuen.

As at the date of this announcement, Canstrong holds 5 shares of US$1.00 in the issued share capital of China Ocean, representing 50% of the existing issued share capital of China Ocean. Canstrong also holds 1,800 ordinary shares of US$10.00 each and 5,880

preferred shares of US$5,000.00 each in the capital of Grand Wealth, representing 18% % and 49% of the ordinary and preferred shares in the capital of the Grand Wealth respectively. Frensham, an indirect wholly-owned subsidiary of Yue Yuen and a fellow subsidiary of Canstrong, holds 62,999,572 Shares, representing approximately 4.82% of the issued share capital of the Company. Frensham holds a 40% interest in Well Success. Frensham also holds a 6.67% interest in First Dynamic International Limited which in turn holds a 40% interest in Well Success. Well Success is the controlling Shareholder holding 664,677,468 Shares, representing approximately 50.81% of the issued share capital of the Company as at the date of this announcement. Save for the aforesaid, to the best of the Directors’ knowledge, information and belief after making reasonable enquiries, Canstrong and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons.

INFORMATION ON CHINA OCEAN

China Ocean is a company incorporated in the BVI with limited liability, the principal assets of which are various trademarks relating to the brand name “PONY” worldwide. The China Ocean Group is principally engaged in the marketing of footwear, apparel and accessories under the “PONY” brand name. It also provides trademark rights and licensing services of the PONY trademarks (including the Transferred Trademarks).

PONY is a US based brand founded by a Uruguay-born entrepreneur in 1972. It offers diverse lifestyle and casual products including men’s and women’s apparel, footwear and accessories such as gloves, scarfs, socks and knitted headwear. PONY products are sold by retailers and distributors in South Korea, Argentina, Brazil, Russia, Japan, Mexico, Europe, Hong Kong, Macau, Taiwan, the PRC, the Philippines, the US and Canada under licensing and distribution arrangements under the China Ocean Group. The China Ocean Group also operates a PONY retail store in Hong Kong.

Set out below are the unaudited consolidated financial information of the China Ocean Group prepared under the Hong Kong Financial Reporting Standards for the two years ended 31 December 2011 and 2012:

	For the year ended 31 December 2011	For the year ended 31 December 2012
	HK$’000	HK$’000
Turnover	59,323	39,390
Profit/(Loss)before taxation	2,876	(34)
Profit/(Loss)after taxation	1,297	(1,985)

INFORMATION ON GRAND WEALTH

Grand Wealth is a company incorporated in the BVI with limited liability, the principal asset of which is an investment in an associated company which is principally engaged in

the marketing and trading of men’s apparel under the brand name “HAGGAR” in the US. The Grand Wealth Group also holds the HAGGAR trademark for the PRC, Hong Kong, Taiwan and Macau via its 62%-owned subsidiary. HAGGAR is a well known men’s apparel brand founded in the US over 95 years ago. Main products include men’s shirts, polo shirts, dressy pants and chino pants.

As at the date of this announcement, Power Plus holds 50% of the issued ordinary shares and 18% of the issued preferred shares in Grand Wealth. Canstrong and its related company, Lucksuccess Limited, in aggregate hold the remaining equity interest in Grand Wealth, being 5,000 ordinary shares and 9,840 preferred shares in the issued share capital of Grand Wealth, representing 50% and 82% of the ordinary and preferred shares in the issued share capital of Grand Wealth respectively. Grand Wealth is at present accounted for as a jointly controlled entity of the Group. After the Grand Wealth Closing, the Company will cease to hold any equity interest in Grand Wealth.

Set out below are the unaudited consolidated financial information of the Grand Wealth Group prepared under the Hong Kong Financial Reporting Standards for the two years ended 31 December 2011 and 2012:

	For the year ended 31 December 2011	For the year ended 31 December 2012
	HK$’000	HK$’000
Turnover	45,745	104,892
Profit before taxation	205,818	57,424
Profit after taxation	205,818	57,424

REASONS FOR THE ACQUISITION, THE DISPOSAL AND THE TRANSFER

The principal activities of the Group are footwear manufacturing, retailing and sourcing, property investment and investment holding in Hong Kong and the PRC.

The Acquisition

As disclosed in the 2012 interim report of the Company, 2012 marks the 40th anniversary of PONY. During the year, marketing efforts were intensified and a PONY specialty store in Hong Kong was launched to promote the brand’s image. The global licence and distribution network continues to expand as a result of increased customer support and interests in the brand. The Directors believe PONY is now positioned for sustained growth and consider it in the interest of the Company to consolidate the equity interest in China Ocean. With the consolidation, the Company will assume complete control over the brand strategy, product development and marketing of the PONY brand in the global marketplace, excluding the PRC and Taiwan. The Directors believe that growth prospects for this authentic vintage brand are bright. The Group currently holds a 50% equity interest in China Ocean and China Ocean is accounted for as a jointly controlled entity of the Group. After the China Ocean Closing, China Ocean will become a wholly-

owned subsidiary of the Company and its accounts will be consolidated into the accounts of the Group.

The Disposal

Despite the weak retail market in the US due to the sluggish economic growth and broad based cut back in consumer spending affected by high unemployment, poor job prospect and high debts, HAGGAR maintained an increased market share in its category in the market. To maintain its competitiveness in a challenging retail market in the US, HAGGAR will further enhance its brand image by partnering with department stores and expand its product range. Notwithstanding the satisfactory performance of the Grand Wealth Group, the Directors consider it is in the interests of the Company to dispose of its minority holding in Grand Wealth to yield the financial resources needed to develop the PONY brand. The Directors believe that PONY has a better fit for the Group’s longterm development strategy than HAGGAR because PONY is a footwear company while HAGGAR is focusing mainly on manufacturing and distribution of men’s pants.

Based on the carrying value of the Group’s investment in Grand Wealth and the amount of shareholders’ loan owed to Power Plus as at 31 December 2012, the Group is not expected to record any material gain or loss on the Disposal. Shareholders should note that the actual gain/loss on the Disposal to be recorded by the Company will depend on the carrying value of the Group’s investment in Grand Wealth as at the Grand Wealth Closing. The Company currently intends to apply the proceeds from the Disposal to settle the consideration for the Acquisition.

The Transfer

The China Ocean Group holds PONY trademarks worldwide. The Transfer enables the Group to focus its marketing resources in expanding the PONY global network outside the PRC and Taiwan and making it better known after the Group consolidates the equity interest in China Ocean.

Based on the carrying value of the Transferred Trademarks as at 31 December 2012 and assuming completion of the acquisition by the Group of the equity interest in China Ocean referred to in this announcement, the Group is expected to record a gain on the Transfer of approximately HK$15.5million. Shareholders should note that the actual gain/loss on the Transfer to be recorded by the Company will depend on the carrying value of the Transferred Trademarks as at the Registration Date. The Company currently intends to apply the proceeds from the Transfer as general working capital of the Group.

The Directors are of the view that the terms of the Acquisition Agreement, the Disposal Agreement and the Trademark Agreement are on normal commercial terms, fair and reasonable and in the interests of the Group and the Shareholders as a whole.

LISTING RULES IMPLICATIONS

GENERAL

DEFINITION

In this announcement, unless the context otherwise requires, the following terms have the following meanings:

“Acquisition” the proposed acquisition of the China Ocean Sale Shares and China Ocean Sale Loan by Canstrong to Power Plus pursuant to the Acquisition Agreement

“Acquisition the conditional sale and purchase agreement dated 27 March Agreement” 2013 entered into between Power Plus and Canstrong in relation to the Acquisition

“Always Gain” Always Gain Holdings Limited, a company incorporated in the BVI with limited liability, which is an indirect whollyowned subsidiary of China Ocean

“associates” the meaning ascribed thereto under the Listing Rules “Board” the board of Directors “Business Day(s)” any day(s) except Saturday, Sunday or other day on which commercial banking institutions in the BVI or Hong Kong are authorised or required by law or executive order to close

“BVI” British Virgin Islands “Canstrong” Canstrong International Limited, a company incorporated in the BVI with limited liability
“China Ocean” China Ocean Resources Limited, a company incorporated in the BVI with limited liability
“China Ocean Closing” closing of the Acquisition under the Acquisition Agreement “China Ocean Group” China Ocean and its subsidiaries
“China Ocean Sale the shareholders’ loan owed by China Ocean to Canstrong as Loan” at the China Ocean Closing “China Ocean Sale 5 shares of China Ocean, representing 50% of the issued Shares” share capital of China Ocean “Company” Symphony Holdings Limited, a company incorporated in Bermuda with limited liability, the issued Shares of which are listed on the main board of the Stock Exchange (Stock code: 1223)
“connected persons” the meaning ascribed thereto under Rule 1.01 and as extended under Rule 14A.11 of the Listing Rules
“Director(s)” director(s) of the Company
“Disposal” the proposed disposal of the Grand Wealth Sale Shares and the Grand Wealth Sale Loan by Power Plus to Canstrong pursuant to the Disposal Agreement
“Disposal Agreement” the conditional sale and purchase agreement dated 27 March 2013 entered into between Power Plus and Canstrong in relation to the Disposal
“Domain Names” collectively, http://www.ponychina.com, http://www.ponytaiwan.com.tw,

http://www.ponychina.com.cn and http://www.ponytaiwan.com, being domain names used by Always Gain in relation to PONY in the PRC and Taiwan “Dream Smart” Dream Smart Limited, a company incorporated in the BVI with limited liability “Frensham” Frensham Investments Limited “Grand Wealth” Grand Wealth Group Limited, a company incorporated in the BVI with limited liability

“Grand Wealth Closing” closing of the Disposal under the Disposal Agreement

“Grand Wealth Group” Grand Wealth and its subsidiaries and associated companies “Grand Wealth Sale the shareholders’ loan owed by Grand Wealth to Power Plus Loan” as at the Grand Wealth Closing “Grand Wealth Sale 5,000 ordinary shares of US$10.00 each and 2,160 preferred Shares” shares of US$5,000.00 each in the capital of Grand Wealth, representing 50% and 18% of the ordinary and preferred shares in the capital of Grand Wealth respectively

“Group” the Company and its subsidiaries
“Hong Kong” the Hong Kong Special Administrative Region of the PRC “Independent Shareholders other than Frensham, Well Success and their Shareholders” respective associates
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange
“Power Plus” Power Plus Limited, a company incorporated in the BVI with limited liability, which is an indirect wholly-owned subsidiary of the Company
“PRC” The People’s Republic of China, excluding Hong Kong, Macau Special Administrative Region and Taiwan
“Prodigy Fund” Prodigy Strategic Investment Fund Series XXII Segregated Portfolio, an investment fund set up and run by Prodigy Asset Management (Cayman Islands) Co.
“Registration Date” the day on which Dream Smart or its nominee first becomes

the registered owner of all of the Transferred Trademarks and Domain Names

“SGM” the special general meeting of the Company to be convened and held for the Independent Shareholders to consider and, if thought fit, approve the Acquisition Agreement and the Disposal Agreement
“Shareholder(s)” holder(s) of the Share(s)
“Share(s)” ordinary share(s) of HK$0.10 each in the share capital of the Company
“Stock Exchange” The Stock Exchange of Hong Kong Limited
“Trademark Agreement” the agreement dated 27 March 2013 entered into between Always Gain and Dream Smart in relation to the Transfer
“Transfer” the transfer of the Transferred Trademarks from Always Gain to Dream Smart pursuant to the Trademark Agreement
“Transferred the PONY trademarks that are registered in the PRC and Trademarks” Taiwan to be transferred pursuant to the Trademark Agreement
“US” United States of America
“Welcome Wealth” Welcome Wealth Properties Limited, a company incorporated in the BVI and a 50% associated company of the Company
“Well Success” Well Success Investment Limited, a company incorporated in the BVI with limited liability
“Yue Yuen” Yue Yuen Industrial (Holdings) Limited, a company incorporated in Bermuda with limited liability, the issued Shares of which are listed on the main board of the Stock Exchange (Stock code: 551)
“HK$” Hong Kong dollars, the lawful currency of Hong Kong
“US$” United States dollars, the lawful currency of the US
“%” per cent.

For illustration purposes in this announcement, the amounts in US$ are translated into HK$ at the rate of US$1.00 = HK$7.76. No representation is made that any amount in US$ has been or could be converted at the above rate or at any other rates or at all.

By order of the Board Symphony Holdings Limited Chan Ting Chuen Chairman

Hong Kong, 27 March 2013

As at the date of this announcement, the Directors are:

Executive Directors: Mr. Chan Ting Chuen (Chairman) Mr. Sze Sun Sun Tony (Deputy Chairman & Managing Director) Mr. Chang Tsung Yuan (Deputy Chairman) Mr. Chan Lu Min Ms. Chen Fang Mei Dr. Ho Ting Seng Non-executive Director: Mr. Li I Nan Independent non-executive Mr. Cheng Kar Shing Directors: Mr. Feng Lei Ming Mr. Ho Shing Chak Mr. Huang Shenglan

AI assistant

Symphony Holdings Limited — M&A Activity 2013

49779_rns_2013-03-27_77e083f9-b71c-48f0-8ebc-846211c60869.pdf

新灃集團有限公司*

MAJOR TRANSACTIONS IN RELATION TO (1) ACQUISITION OF 50% EQUITY INTEREST IN CHINA OCEAN RESOURCES LIMITED; AND (2) DISPOSAL OF 18.32% EQUITY INTEREST IN GRAND WEALTH GROUP LIMITED;

AND

DISCLOSEABLE TRANSACTION IN RELATION TO DISPOSAL OF TRADEMARKS

THE ACQUISITION

THE DISPOSAL

THE TRANSFER

LISTING RULES IMPLICATIONS

GENERAL

THE ACQUISITION AGREEMENT

Date:

Parties:

Assets to be acquired:

Consideration:

Conditions of the Acquisition:

China Ocean Closing:

Termination:

THE DISPOSAL AGREEMENT

Date:

Parties:

Assets to be disposed of:

Consideration:

Conditions of the Disposal:

Grand Wealth Closing:

Termination:

THE TRADEMARK AGREEMENT

Date:

Parties:

Principal terms:

Information on the Transferred Trademarks:

Consideration:

Conditions of the Transfer:

Termination:

INFORMATION ON CANSTRONG

INFORMATION ON CHINA OCEAN

INFORMATION ON GRAND WEALTH

REASONS FOR THE ACQUISITION, THE DISPOSAL AND THE TRANSFER

The Acquisition

The Disposal

The Transfer

LISTING RULES IMPLICATIONS

GENERAL

DEFINITION

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Symphony Holdings Limited M&A Activity 2013