China Automation Group Limited (SEHK:569) entered into a sale and purchase agreement to acquire a 60% stake in Etern Healthcare (HK) Limited from Ascendent Healthcare (Cayman) Limited on March 30, 2017. The consideration will be settled by issue of convertible bond in the principal amount equal to the net profit after tax of Etern Healthcare (HK) Limited for the year ended December 31, 2016, multiplied by twenty. If the consideration is less than CNY 620 million or more than CNY 760 million, either of the parties may elect not to proceed with the completion of the transaction. Upon completion, Etern Healthcare (HK) Limited will become a subsidiary of China Automation Group Limited. At completion, the parties will enter into a shareholders' agreement to regulate their respective rights and obligations. China Automation Group Limited shall have the right to nominate three directors and the chairman of Etern Healthcare (HK) Limited. The transaction is subject to the approval of the shareholders of China Automation Group Limited, stock exchange granting the listing of new shares issuable pursuant to the conversion of convertible bond, approval of the Anti-Monopoly Bureau of the Ministry of Commerce of China, regulatory or governmental approvals and others. As on June 23, 2017, China Automation Group Limited entered into a supplemental agreement to the sale and purchase agreement pursuant to which now the transaction is not subject to approval from Anti-Monopoly Bureau of the Ministry of Commerce of China. A shareholders meeting of China Automation Group Limited is to be held on July 12, 2017, to approve the transaction. China Automation Group Limited established an independent Board committee comprising all the independent non-executive Directors namely Wang Tai Wen, Ng Wing Fai and Zhang Xin Zhi to advise the shareholders in respect of the transaction. The independent Board committee consider the terms of transaction to be fair and reasonable so far as the independent shareholders are concerned and accordingly recommend to vote in favor of the transaction. The transaction is expected to complete on the third business day following the day on which all the conditions precedent have been fulfilled/waived. On July 12, 2017, the transaction is approved by the shareholders of China Automation Group Limited at the Extraordinary General Meeting. Amasse Capital Limited acted as financial advisor for the independent Board committee in the transaction. Tricor Investor Services Limited acted as registrar of China Automation Group Limited and appointed as scrutineer at the extraordinary general meeting for the purpose of vote-taking. Marcia Ellis of Morrison & Foerster LLP acted as the legal advisor to Ascendent Capital.