Xingye Copper : ANNOUNCEMENT IN RELATION TO A POTENTIAL ACQUISITION

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XINGYE COPPER INTERNATIONAL GROUP LIMITED 興 業 銅 業 國 際 集 團 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 505)

ANNOUNCEMENT IN RELATION TO A POTENTIAL ACQUISITION POTENTIAL ACQUISITION

This announcement is made by the Company pursuant to Rule 13.09(2)(a) of the Listing Rules and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).

The Board is pleased to announce that, after the trading hours on 4 March 2016, the Company has entered into the Term Sheet with, amongst others, the Vendor and the Target Company, in relation to the Company's potential acquisition of the entire share capital of the Target Company from the Vendor. If the Proposed Transaction contemplated under the Term Sheet materialises, it may constitute a notifiable transaction of the Company under the Listing Rules. Further announcement(s) in relation to the Proposed Transaction will be made by the Company as and when appropriate in compliance with the Listing Rules.

Shareholders of the Company and potential investors should note that the Proposed Transaction is subject to, among other things, the signing of definitive agreement, the terms and conditions of which are yet to be agreed. The Proposed Transaction may or may not proceed and the final structure and terms of the Proposed Transaction, which are still subject to further negotiations between the parties, have yet to be finalised and may deviate from that set out in the Term Sheet. Shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company.

This announcement is made by Xingye Copper International Group Limited (the "Company", together with its subsidiaries, the "Group") pursuant to Rule 13.09(2)(a) of the Rules Governing the Listing of Securities on the Stock Exchange (the "Listing Rules") and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).

POTENTIAL ACQUISITION

The board of directors of the Company (the "Board") is pleased to announce that, after the trading hours on 4 March 2016, the Company has entered into a non-legally binding term sheet (the "Term Sheet") with, amongst others, Mobilefun Limited (the "Vendor") and Funnytime Limited (the "Target Company"), in relation to the Company's potential acquisition of the entire share capital of the Target Company from the Vendor (the "Proposed Transaction"). The terms and conditions of the Proposed Transaction are subject to further negotiations between the parties thereof and completion of due diligence to be conducted by the Company. Pursuant to the Term Sheet, the Company was granted an exclusivity period of 180 business days to conduct negotiations with the parties thereof for entering into a formal agreement in relation to the Proposed Transaction.

Save as the clauses relating to exclusivity, confidentiality, costs, applicable law and dispute resolution, the Term Sheet does not impose obligations on the parties to consummate the Proposed Transaction and the parties thereto have no legally binding rights or obligations with respect to the matters specified therein.

To the best knowledge, information and belief of the directors of the Company, having made all reasonable enquiries, the Vendor and its ultimate beneficial owner(s) are third parties independent of the Company and its connected persons (as defined under the Listing Rules).

INFORMATION OF THE TARGET COMPANY

The Target Company is a company incorporated in the British Virgin Islands with limited liability. It is an investment holding company which holds the entire issued share capital of Soul Dargon Limited, which is an investment holding company and in turn holds the entire equity interest in Hefei Yueyou Network Technology Co., Ltd. (合肥悅遊網絡科技有限公司) (the "WFOE"). The WFOE enjoys the entire economic interests and benefits of the Hefei Zhangyue Network Technology Co., Ltd. (合肥掌悅 網絡科技有限公司), the holding company of Shenzhen Zhangyue Network Technology Co., Ltd. (深圳掌悅網絡科技有限公司) (collectively the "Operating Subsidiaries"), by a series of contractual arrangements.

The Operating Subsidiaries are incorporated in the People's Republic of China (the "PRC") and principally engaged in the development, publishing and operation of internet and mobile gaming products. The Operating Subsidiaries have an experienced team of internet and mobile gaming talents in the fields of development, publishing and operation of games in China. In addition, the Operating Subsidiaries have been cooperating with various domestic and overseas online game platforms in developing its gaming products. The Operating Subsidiaries have successfully published and are operating a famous online web game, Scions of Fate Online (web) (熱血江湖 傳), which has experienced promising growth in terms of game revenue attributable to the Operating Subsidiaries since its initial launch on the Tencent online web game platform in October 2015. The Operating Subsidiaries' self-developed games such as the Gods (眾神大陸) would be released gradually aiming to further expand the source of revenue of the Operating Subsidiaries.

REASONS FOR ENTERING INTO THE TERM SHEET

The Company is an investment holding company with its principal subsidiaries engaged in manufacturing and sales of high precision copper plates and strips, trading of raw materials, provision of processing services (the "Copper Business"). Due to the volatility and cyclicality of the Copper Business, the Group has been proactively looking for potential acquisition opportunities to diversify its existing business portfolio into new line of business with growth potential, to reduce overall risk profile, and to broaden the source of income and eventually to enhance the value of its shareholders. The Group has since then identified the internet and mobile gaming industry which has experienced rapid growth in the PRC in recent years, and the directors of the Company believe the Proposed Transaction represent a good acquisition opportunity with promising growth potential.

GENERAL

If the Proposed Transaction contemplated under the Term Sheet materialises, it may constitute a notifiable transaction of the Company under the Listing Rules. Further announcement(s) in relation to the Proposed Transaction will be made by the Company as and when appropriate in compliance with the Listing Rules.

Shareholders of the Company and potential investors should note that the Proposed Transaction is subject to, among other things, the signing of definitive agreement, the terms and conditions of which are yet to be agreed. The Proposed Transaction may or may not proceed and the final structure and terms of the Proposed Transaction, which are still subject to further negotiations between the parties, have yet to be finalised and may deviate from that set out in the Term Sheet. Shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company.

By order of the Board

Xingye Copper International Group Limited HU Changyuan

Chairman

Hong Kong, 4 March 2016

As at the date of this announcement, the executive directors of the Company are Mr. HU Changyuan, Mr. HU Minglie, Mr. WANG Jianli, Mr. MA Wanjun and Mr. CHEN Jianhua, the non-executive director of the Company is Mr. DAI Jianchun and the independent non-executive directors of the Company are Mr. MAO Xuechang, Mr. CHAI Chaoming and Dr. LOU Dong.