About HENGAN INT'L Company

The issuer is a limited liability company established in the Cayman Islands on July 22, 1998, and listed on the main board of the Stock Exchange on December 8, 1998. The stock code is 01044.HK. On 2011/6/7, Hengan International was officially listed as a constituent stock of the Hong Kong Hang Seng Index. In June 2001, the group introduced the world-famous management consulting company, Thomas Group of the United States, into the enterprise to implement enterprise management and transformation. The core of this change is full-cycle time management. By ignoring a series of processes, the goal of shortening work time is achieved. The group entered the household paper industry from 2003 to 2004. In March 2003, the Group announced the acquisition of shareholder loans and all equity interests of Xielong (Cayman Island) International Holdings Limited from the issuer's then-shareholders Mr. Shi Wenbo, Mr. Xu Lianjie and Mr. Yang Rongchun at the cost of HK$262,500,000 in cash and the allocation of 44,554,455 new shares of the Company (HK$2.525 each). The main asset of Xielong (Cayman Island) International Holdings Limited is a 68.9% equity interest in Changde Hengan Co., Ltd. (“Changde Hengan”). Changde Hengan is a household paper manufacturer, and its brand “Heart to Heart” is a well-known trademark in China. In addition, Changde Hengan also holds 75% of the interest in Fushun Hengan Photoprinting Paper Products Co., Ltd. (“Fushun Hengan”), Jinjiang Hengan Photoprinting Paper Products Co., Ltd. (“Jinjiang Hengan”) and Hengan (Chongqing) Paper Products Co., Ltd. (“Hengan Chongqing”). In March 2004, the Group announced the acquisition of 31.1% of Changde Hengan's interests from various third parties at a total cost of HK$368,093,000, and 25% of the interests of Fushun Hengan, Jinjiang Hengan, and Hengan Chongqing. 50% of the total cost was paid in cash, and the remaining 50% was paid by issuing 40,899,900 new shares of the Company (HK$4.5 each). The issuer issued zero-interest convertible bonds with a total principal amount of HK$1.5 billion due in May 2011 at an initial exchange price of $19.12 per common share of the Company in May 2006. In October 2007, the issuer commissioned MorganStanley & Co. InternationalPLC to place 60,000,000 shares at HK$30.47 per share in a new and new manner. The net proceeds amounted to approximately HK$1,797 million, mainly for potential acquisitions, capacity expansion and general working capital. In 2008, the issuer restructured the shareholding structure of its domestic and foreign subsidiaries. First, the shares of a number of domestic subsidiaries held by the holding company in the British Virgin Islands controlled by the issuer were transferred to Heng An Jumbo Investment Co., Ltd. (“Heng An Jumbo”) (Hong Kong Company). Afterwards, Hengan (China) Investment Co., Ltd. (“Hengan China Investment”) was established in Xiamen. Its main business scope was to invest according to law in fields where the country allows foreign investment (including strategic investment in listed companies in accordance with national regulations, etc.). In addition, Hengan CIC transfers all of the shares of domestic subsidiaries held by Heng An Jumbo Investment, thus achieving the goal of Heng An Jumbo controlling domestic companies through the indirect holding of Heng An China Investment. In December 2008, the group introduced Bosch Allen, an internationally renowned management consulting firm, and initiated the second management transformation. The core of this change is target management. On the basis of establishing medium- to long-term development strategies, a management system adapted to the new strategic development has been established. In November 2008, the Group acquired Qin Qin Foods Group Co., Ltd. (“Qin Qin Foods”). Qin Qin Foods is one of the leading jelly producers in China, and its brand “Qin Qin” is a well-known trademark in China. Through the acquisition of Qin Qin Foods, the group entered another major category of FMCG products — the snack food industry. The issuer issued zero-interest convertible bonds with a total principal amount of HK$5.434 billion due in June 2018 at an initial exchange price of HK$120.0825 per common share of the Company in June 2013. In 2014, the Group once again began the third management transformation centered on supply chain transformation and upgrading. It joined hands with international giants IBM and SAP to reform supply chain management and create an “end-to-end” information integration, efficient collaboration, and rapid response supply chain platform to promote the visualization of operations and the integration of plans. At the same time, the group built a large-scale modern daily necessities production base in Jinjiang and implemented an intelligent three-dimensional warehousing project, which was simultaneously extended to production companies outside the province. On July 8, 2016, Qin Qin Foods, a subsidiary of Hengan Group, was listed on the main board of the Hong Kong Stock Exchange. Hengan Group completed the spin-off of Qin Foods and distributed all of its issued share capital in physical form to qualified shareholders of Hengan Group based on the basis of one share issued for every five Heng An shares held. On June 5, 2017, Hengan Group acquired a total of 80 million shares of Huangcheng Group, a company listed on the main board of the Malaysian Stock Exchange. Sales shares accounted for about 50.45% of Huangcheng's share capital, and the transaction price was reduced to about 146 million yuan, which is an important part of the Group's overseas business expansion development. On December 27, 2017, Hengan Zhenbao Investment Co., Ltd. and Hengan (China) Investment Co., Ltd. jointly acquired all of Weifang Thermal Power's shares for RMB 150 million. In February 2018, Hengan (Oriental) Health Products Co., Ltd., an indirect subsidiary of Hengan Group, was established in Russia. Its main business scope is the manufacture, distribution and sale of personal hygiene products in Russia. Hengan Group holds 51% of its shares. Production began in June 2019, expanding the diaper business to the Russian market. On April 4, 2018, Hengan Group acquired 100% of the shares of Sound Technology Group, with a transaction price of about RMB 142 million. The aim was to expand the market share of the household products portfolio and increase the group's overall sales revenue. On the 23rd of the same month, Hengan Group invested a total of 36.46% of Finnpulp's shares in Finnish pulp company Finnpulp with about 11.67 million euros to expand its upstream pulp business.