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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. This announcement is for information purposes only and does not constitute an invitation to offer to acquire, purchase or subscribe for the securities. New Sports Group Limited 新 體 育 集 團 有 限 公 司 (Incorporated in the Cayman Islands with limited liability) (Stock code: 299) (1) MAJOR ACQUISITION IN RELATION TO ACQUISITION OF THE ENTIRE ISSUED SHARE CAPITAL IN YUE JIN ASIA LIMITED INVOLVING THE ISSUE OF CONSIDERATION SHARES UNDER SPECIFIC MANDATE; (2) ISSUE OF NEW SHARES UNDER SPECIFIC MANDATE; (3) PLACING OF NEW SHARES UNDER SPECIFIC MANDATE; (4) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL Financial Adviser to the Company CVP Capital Limited Placing Agent CHINA YINSHENG SECURITIES LIMITED – 1 – THE ACQUISITION On 19 September 2016 (after trading hours), the Company and the Purchaser, being a direct wholly-owned subsidiary of the Company, entered into the Sale and Purchase Agreement with the Seller and the Seller Guarantor, pursuant to which, subject to the fulfillment of the Conditions Precedent, (a) the Purchaser has agreed to purchase, and the Seller has agreed to sell the Target Share, representing the entire issued share capital in the Target Company, and (b) the Purchaser has agreed to accept, and the Seller has agreed to assign all of the Seller’s rights, title, interest and benefits in and to the Loan. The Consideration shall be initially HK$1,000,000,000, subject to Retained Consideration Adjustments. The Consideration was determined after arm’s length negotiations among the parties to the Sale and Purchase Agreement with reference to the estimated aggregate value of the Yacht Club Business, School Business and the Real Property of HK$1,007,900,000 as at 31 August 2016 according to the preliminary valuation by an independent valuer, Roma Appraisals Limited. Each of the Acquisition and the Subscriptions is inter-conditional with each other. The Completion shall take place simultaneously with (or in any event immediately following) the Subscription Completion on the Completion Date. The Purchaser shall have the Put Option to, at the Purchaser’s discretion, sell the Option Target Shares to the Seller at any time within 5 calendar years after the Completion upon the Shenzhen Dapeng New District Management Committee or any other relevant governmental authority enforcing its rights under the Operation Entrustment Agreement for any breach of the Operation Entrustment Agreement by any member of the Group before the Completion at the Option Share Price. As one or more of the applicable percentage ratios (as defined under the Listing Rules) of the Acquisition exceeds 25%, the Acquisition constitutes a major transaction of the Company under Chapter 14 of the Listing Rules and is therefore subject to the reporting, announcement, circular and shareholders’ approval requirements under Chapter 14 of the Listing Rules. As the Preliminary Valuations is regarded as a profit forecast under Rule 14.61 of the Listing Rules. Information in compliance with Rule 14.62 of the Listing Rules in respect of the said profit forecast will be contained in the Circular. A valuation report on the Real Property in compliance with the requirements of Chapter 5 of the Listing Rules will be included in the Circular to be despatched to the Shareholders. THE SUBSCRIPTIONS On 19 September 2016 (after trading hours), each of Origin Development Limited, Crystal Fount Investments Limited, Ms. Ai Qing and Ms. Zheng Kuanjian entered into a separate Subscription Agreement with the Company, pursuant to which the Subscribers have conditionally agreed to subscribe for, and the Company has conditionally agreed to allot and issue, a total of 12,181,629,000 Subscription Shares at the Subscription Price of HK$0.062 per Subscription Share. – 2 – The Subscription Shares will be issued under Subscription Specific Mandate to be approved by the Independent Shareholders at the EGM. Application will be made by the Company to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Subscription Shares. Each of the Acquisition and the Subscriptions is inter-conditional with each other. The Subscription Completion shall take place simultaneously with the Completion and the Subscription Completion on the Completion Date. THE PLACING The Company and the Placing Agent entered into the Placing Agreement pursuant to which the Placing Agent has conditionally agreed to place, on a best endeavour basis, a total of up to 4,088,000,000 Placing Shares to not less than six Placees at the Placing Price. The Placing Shares represent (i) approximately 26.61% of the issued share capital of the Company as at the date of this announcement; and (ii) approximately 11.20% of the issued share capital of the Company as enlarged by the allotment and issue of the Consideration Shares, the Subscription Shares and the Placing Shares. The Placing Shares will be issued under Placing Specific Mandate to be approved by the Independent Shareholders at the EGM. Application will be made by the Company to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Placing Shares. The Placing Shares, when allotted and issued, will rank pari passu in all respects among themselves, and with the existing Shares then in issue. The Placing Agent will receive a placing commission of 1.0% of the aggregate Placing Price of the Placing Shares placed by or on behalf of the Placing Agent on behalf of the Company pursuant to the Placing Agreement. Such placing commission was determined after arm’s length negotiation between the Company and the Placing Agent with reference to the prevailing market conditions. The Directors consider that the commission for the Placing is fair and reasonable. INCREASE IN AUTHORISED SHARE CAPITAL The Board proposed to increase the authorised share capital of the Company from HK$100,000,000 divided into 40,000,000,000 Shares to HK$200,000,000 divided into 80,000,000,000 Shares by the creation of additional 40,000,000,000 Shares, all of which will rank pari passu with all existing Shares. – 3 – The EGM will be held for the purpose of considering and, if thought fit, approving the relevant ordinary resolution(s) in respect of (i) the Sale and Purchase Agreement and the Acquisition contemplated thereunder and the Acquisition Specific Mandate; (ii) the Subscription Agreements and the Subscriptions contemplated thereunder and the Subscription Specific Mandate; (iii) the Placing Agreement and the Placing contemplated thereunder and the Placing Specific Mandate; and (iv) the Increase in Authorised Share Capital. To the best of the Directors’ knowledge, information and belief after having made all reasonable enquiries, no Shareholder has a material interest in the Acquisition and the Specific Mandate and therefore no Shareholder is required to abstain from voting at the EGM. The Circular containing, amongst other things, details of the Sale and Purchase Agreement, the Acquisition, the Subscription and the Placing, financial information in relation to the Target Group, the pro-forma financial statement of the Group, a valuation report of the Real Property Project, other disclosure requirements under the Listing Rules regarding the transactions contemplated under the Sale and Purchase Agreement and a notice convening the EGM is expected to be despatched to the Shareholders on or before 21 October 2016, which is more than 15 business days (as defined under the Listing Rules) after the publication of this announcement, as the Company requires additional time to prepare necessary information for inclusion in the Circular. THE ACQUISITION, SUBSCRIPTIONS AND PLACING On 19 September 2016 (after trading hours), (i) the Company and the Purchaser, being a direct wholly-owned subsidiary of the Company, entered into the Sale and Purchase Agreement with the Seller and the Seller Guarantor, pursuant to which, subject to the fulfillment of the Conditions Precedent, (a) the Purchaser has agreed to purchase, and the Seller has agreed to sell, the Target Share, representing the entire issued share capital in the Target Company, and (b) the Purchaser has agreed to accept, and the Seller has agreed to assign, all of the Seller’s rights, title, interest and benefits in and to the Loan; (ii) each of Subscribers entered into a separate Subscription Agreement with the Company, pursuant to which the Subscribers have conditionally agreed to subscribe for, and the Company has conditionally agreed to allot and issue, a total of 12,181,629,000 Subscription Shares at the Subscription Price of HK$0.062 per Subscription Share; and (iii) the Company and the Placing Agent entered into the Placing Agreement, pursuant to which, subject to the fulfillment of the Placing Conditions Precedent, the Company agreed to place, through the Placing Agent, on a best endeavour basis, up to 4,088,000,000 new Shares to not less than six independent Placees at the Placing Price of HK$0.062 per Placing Share. – 4 – SALE AND PURCHASE AGREEMENT The information of the Sale and Purchase Agreement is summarized as below: Date 19 September 2016 (after trading hours) Parties Buyer: theCompany(throughthePurchaser) Seller: theSeller Seller guarantor: the Seller Guarantor Asset to be acquired: the Target Share, representing the entire issued share capital in the Target Company and all of the Seller’s rights, title, interest and benefits in and to the Loan To the best of the Directors’ knowledge, information and belief after having made all reasonable enquiries, as at the date of this announcement, each of the Seller and its ultimate beneficial owners is an Independent Third Party.