Sunstone Development Co., Ltd. (SHSE:603612) agreed to acquire 94.98% stake in Foshan City Xin Yuan Electronic Co.,Ltd. from group of sellers for CNY 1.1 billion on May 17, 2022. The consideration shall be payable through cash and share issuance. For the year ended December 31, 2021, Foshan City Xin Yuan Electronic Co.,Ltd. has reported total assets of CNY 548.63 million, net assets of CNY 227.86 million, revenues of CNY 515.14 million and net profit of CNY 84.18 million. The transaction is subject to obtaining approval from shareholders and Board of Directors of Sunstone Development Co., Ltd. after the completion of the audit and appraisal of Foshan City Xin Yuan Electronic Co.,Ltd. and confirmation of final price for the transaction. Transaction is also subject to obtaining approvals from China Securities Regulatory Commission. Shares issued pursuant to the transaction has a lock up period of 12 months. The transaction has been approved by 28th session of Company's 4th Directorate and 20th session of 4th Supervisory Board. The Guangzhou Sanshun Commercial Investment Partnership Enterprise (Limited Partnership) has already completed internal-decision making procedures. As of September 17, 2022, According to Article 30 of the "Anti-Monopoly Law of the People's Republic of China", after preliminary examination, it is decided that no further examination will be carried out. The transaction still needs to be reviewed and approved by Sunstone Development's general meeting of shareholders and approved by the competent regulatory agency before it can be formally implemented. As on September 26, 2022, Sunstone Development's shareholders approved the transaction. As on December 6, 2022, Xue Yong will sell 66.7558% stake in CNY 801.07 million, Guangzhou Sanshun Commercial Investment Partnership will sell 9.6001% stake in CNY 115.201 million, Liang Jin will sell 4.1149% stake in CNY 49.379 million, Zhang Bao will sell 3.3457% in CNY 40.1487 million, Xie Zhimao will sell 3.0720% stake in CNY 36.8643 million, Xue Zhanqing will sell 2.9456% stake in CNY 35.3475 million, Xue Zhanfeng will sell 2.8800% stake in CNY 34.5603 million and Zhang Xuewen will sell 2.2636% stake in CNY 27.1629 million. As on December, 26, 2022, Merger, Acquisition and Reorgnization Examination Committee approved the transaction. Transaction has been approved by China Securities Regulatory Commission.

Sunstone Development Co., Ltd. will use the raised funding of CNY 341.92 for the cash consideration and CNY 341.92 for working capital Shen Rujun of China International Capital Corporation Limited acted as financial advisor, Wang Li of DeHeng Law Offices acted as legal advisor and Wu Weixing of Wuyige Certified Public Accountants LLP acted as accountant of Sunstone Development Co., Ltd.

Sunstone Development Co., Ltd. (SHSE:603612) completed the acquisition of 94.98% stake in Foshan City Xin Yuan Electronic Co.,Ltd. from group of sellers on March 15, 2023.