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, under the stock code 01044.HK. On June 7, 2011, Hengan International was officially included as a constituent stock of the Hong Kong Hang Seng Index. In June 2001, the Group introduced the world-famous management consulting company, Toms Group of the United States, to enter the enterprise and carry out enterprise management and transformation. The core of this transformation is full cycle time management. Through the streamlining of a series of processes, the goal of shortening work time is achieved. The Group entered the tissue 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 current shareholders Mr. Shi Wenbo, Mr. Xu Lianjie and Mr. Yang Rongchun at the cost of HK$262,500,000 in cash and allotment of 44,554,455 new shares of the Company (HK$2.525 per share). The main asset of Xielong (Cayman Island) International Holdings Limited is 68.9% of the 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% interests in Fushun Hengan Anxin Printing Paper Products Co., Ltd. (“Fushun Hengan”), Jinjiang Hengan Printing 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, as well as 25% of the interests of Fushun Hengan, Jinjiang Hengan, and Hengan Chongqing. 50% of this 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 per share). The issuer issued zero-interest convertible bonds with a total principal amount of HK$1.5 billion due in May 2011 at an initial conversion price of $19.12 per common share of the Company. In October 2007, the issuer commissioned Morgan Stanley & Co.InternationalPLC to place 60,000,000 shares at HK$30.47 per share using the old and new methods. The net proceeds amounted to approximately HK$1.797 billion, mainly for potential acquisitions, capacity expansion and general working capital purposes. In 2008, the issuer restructured the shareholding structure of its domestic and foreign subsidiaries. First, shares in a number of domestic subsidiaries held by the British Virgin Islands holding company controlled by the issuer were transferred to Hengan Treasure Investment Co., Ltd. (“Hengan Treasure”) (Hong Kong company). Subsequently, Hengan (China) Investment Co., Ltd. (“Hengan Investment”) was established in Xiamen. Its main business scope is to invest in fields where the country allows foreign investment according to law (including making strategic investments in listed companies in accordance with national regulations). Hengan China Investment then transferred all of the shares in the domestic subsidiary held by Hengan China Investment, thus achieving Hengan Treasure's goal of controlling domestic companies through mutual ownership by Hengan China Investment. In December 2008, the Group introduced Boss Allen, an internationally renowned management consulting company, to launch a second management transformation. The core of this transformation is target management. On the basis of establishing medium- to long-term development strategies, a management system adapted to the development of new strategies has been established. In November 2008, the Group acquired Qinqin Foods Group Co., Ltd. (“Qinqin Foods”). Qinqin Foods is one of the leading jelly producers in China, and its brand “Qinqin” is a well-known trademark in China. Through the acquisition of Qinqin Foods, the Group entered the snack food industry, another major category of FMCG. 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 2014, the Group once again embarked on the third management transformation centered on supply chain transformation and upgrading. Together with international giants IBM and SAP, they reformed supply chain management, built an “end-to-end” information integration, efficient collaboration, and rapid response supply chain platform to promote the visualization of operations and integration of plans. At the same time, the group built a large-scale modern household goods production base in Jinjiang and implemented an intelligent three-dimensional storage project, which was simultaneously extended to production companies outside the province. On July 8, 2016, Qinqin 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 Qinqin Foods and distributed all of its issued share capital in physical form to eligible shareholders of Hengan Group on the basis of one share issued for every five shares of Hengan 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. The sales shares account for about 50.45% of Huangcheng's share capital equity, and the transaction price is about RMB 0.146 billion, which is an important part of the Group's expansion of overseas business development. On December 27, 2017, Hengan Treasure Investment Co., Ltd. and Hengan (China) Investment Co., Ltd. jointly acquired all shares in Weifang Thermal Power for RMB 0.15 billion. In February 2018, Hengan (Oriental) Health Products Co., Ltd., an indirect subsidiary of Hengan Group, was established in Russia. Its main business scope is to manufacture, distribute and sell 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 Acoustics Group's shares at a transaction price of approximately RMB 0.142 billion, with the aim of expanding the market share of the home furnishing product portfolio and increasing the Group's overall sales revenue. On the 23rd of the same month, Hengan Group took a total of 36.46% of FinnPulp's shares in FinnPulp for about 11.67 million euros to expand the upstream pulp business.