Ta Yang : PROPOSED RIGHTS ISSUE ON THE BASIS OF ONE (1) RIGHTS SHARE FOR EVERY TWO (2) EXISTING SHARES HELD ON THE RECORD DATE AT THE SUBSCRIPTION PRICE OF HK$0.14 PER RIGHTS SHARE ON A NON-UNDERWRITTEN BASIS

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 appears for information purposes only and does not constitute an invitation or offer to sell, dispose, acquire, purchase or subscribe for any securities of the Company.

TA YANG GROUP HOLDINGS LIMITED

大 洋 集 團 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(STOCK CODE: 1991)

PROPOSED RIGHTS ISSUE ON THE BASIS OF

ONE (1) RIGHTS SHARE FOR EVERY TWO (2)

EXISTING SHARES HELD ON THE RECORD DATE AT

THE SUBSCRIPTION PRICE OF HK$0.14 PER RIGHTS SHARE

ON A NON-UNDERWRITTEN BASIS

PROPOSED RIGHTS ISSUE

The Company proposes to raise a maximum of approximately HK$60.98 million (before deducting professional fees and other related expenses) by way of the Rights Issue, whereby 435,589,000 Rights Shares shall be allotted and issued on the basis of one (1) Rights Share for every two (2) existing Shares held on the Record Date.

The Subscription Price of HK$0.14 per Rights Share is payable in full when a Qualifying Shareholder accepts the relevant provisional allotment of Rights Shares or applies for excess Rights Shares or when a transferee of nil-paid Rights Shares accepts the provisional allotment of the relevant Rights Shares.

Assuming no new Shares are issued and/or repurchased by the Company on or before the Record Date, a total number of Rights Shares of 435,589,000 will be allotted and issued representing:

1. approximately 50.0% of the Company's existing issued Shares as at the date of this announcement; and
2. approximately 33.3% of the Company's existing issued Shares as enlarged by the issue of the Rights Shares.

Assuming full acceptance of the Rights Shares by the Qualifying Shareholders, the aggregate nominal value of the Rights Shares, of nominal value of HK$0.10 each, will be approximately HK$43.6 million.

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Subject to the fulfilment and/or waiver (where applicable) for the conditions of the Rights Issue, the Rights Issue will proceed on a non-underwritten basis irrespective of the level of acceptance of the provisionally allotted Rights Shares. If there is an under-subscription of the Rights Issue as a result of Untaken Rights not being fully taken up by Qualifying Shareholders or transferees of nil-paid Rights Shares, the size of the Rights Issue will be reduced accordingly.

Subject to the Irrevocable Undertaking as more particularly described in the section headed ''Irrevocable Undertaking'' in this announcement, a minimum amount of HK$30.56 million in respect of 218,270,200 Rights Shares undertaken by Lyton Maison will be raised under the Rights Issue.

THE IRREVOCABLE UNDERTAKING

On 13 May 2021 (after trading hour), the Company received from Lyton Maison the Irrevocable Undertaking, which provides, among other things, that:

1. Lyton Maison will in aggregate take up the maximum of 218,270,200 Rights Shares, being the assured entitlements to the Rights Shares in respect of 436,540,400 Shares owned by Lyton Maison as at the date of the Irrevocable Undertaking pursuant to the terms of the Rights Issue; and
2. Lyton Maison will not sell, transfer or dispose of 436,540,400 Shares owned by it as at the date of the Irrevocable Undertaking from the date of the Irrevocable Undertaking up to and including the date on which the Rights Issue has become unconditional or the date on which the Company announces that the Rights Issue will not proceed, whichever is earlier.

As at the date of this announcement, Lyton Maison holds 436,540,400 Shares, representing 50.11% of the issued share capital of the Company as at the date of this announcement.

The Rights Issue will proceed on a non-underwritten basis irrespective of the level of acceptances of the provisionally allotted Rights Shares. If there is an under- subscription of the Rights Issue as a result of Untaken Rights not being fully taken up by Qualifying Shareholders or transferees of nil-paid Rights Shares, the size of the Rights Issue will be reduced accordingly. Investors are advised to exercise caution when dealing in the Shares.

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CLOSURE OF REGISTER OF MEMBERS

The register of members of the Company will be closed from Monday, 24 May 2021 to Friday, 28 May 2021 (both dates inclusive) for the purpose of determining the Shareholders' entitlements to the Rights Issue. During this period, no transfer of Shares will be registered.

LISTING RULES IMPLICATIONS

The Rights Issue is not subject to Shareholders' approval under the Listing Rules and will be carried out in compliance with Rule 7.21(1) of the Listing Rules.

WARNING OF THE RISKS OF DEALINGS IN THE SHARES AND NIL-PAID RIGHTS SHARES

The Rights Issue is subject to the fulfilment and/or waiver (where applicable) of conditions including, among other things, the Stock Exchange granting the listing of, and permission to deal in, the Rights Shares in their nil-paid and fully-paid forms. Please refer to the section headed ''Conditions of the Rights Issue'' in this announcement. Shareholders and potential investors of the Company should note that if the conditions to the Rights Issue are not satisfied and/or waived (where applicable), the Rights Issue will not proceed.

Any dealings in the Shares from the date of this announcement up to the date on which all the conditions of the Rights Issue are fulfilled and/or waived (where applicable), and any Shareholders dealing in the Rights Shares in nil-paid form will accordingly bear the risk that the Rights Issue may not become unconditional or may not proceed. Any Shareholders or other persons contemplating any dealings in the Shares or Rights Shares in their nil-paid form are recommended to consult their professional advisers.

PROPOSED RIGHTS ISSUE

The Company proposes to raise a maximum of approximately HK$60.98 million (before deducting professional fees and other related expenses) by way of the Rights Issue of 435,589,000 Rights Shares at the Subscription Price of HK$0.14 each and on the basis of one (1) Rights Share for every two (2) Shares held by the Qualifying Shareholders on the Record Date.

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The Rights Issue will not be extended to the Excluded Shareholder(s). The terms of the Rights Issue are set out below:

Assuming no change in the number of issued Shares on or before the Record Date, the 435,589,000 Rights Shares proposed to be issued pursuant to the terms of the Rights Issue represent: (i) 50.0% of the existing issued share capital of the Company as at the date of this announcement; and (ii) 33.3% of the issued share capital of the Company as enlarged by the allotment and issue of the Rights Shares.

As at the date of this announcement, the Company has no outstanding derivatives, options, warrants, conversion securities or other similar securities which are convertible or exchangeable into Shares. The Company has no intention to issue or grant any Shares, convertible securities, warranties and/or options on or before the Record Date.

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Subscription Price

The Subscription Price of HK$0.14 per Rights Share is payable in full when a Qualifying Shareholder accepts the relevant provisional allotment of Rights Shares or applies for excess Rights Shares or when a transferee of nil-paid Rights Shares accepts the provisional allotment of the relevant Rights Shares.

The Subscription Price represents:

1. a discount of approximately 22.22% to the closing price of HK$0.18 per Share as quoted on the Stock Exchange on the Last Trading Day;
2. a discount of approximately 21.08% to the average of the closing prices of Shares for the five consecutive trading days ended on the Last Trading Day of approximately HK$0.1774 per Share;
3. a discount of approximately 20.23% to the average of the closing prices of Shares for the ten consecutive trading days ended on the Last Trading Day of approximately HK$0.1755 per Share;
4. a discount of approximately 16.02% to the theoretical ex-rights price of approximately HK$0.1667 per Share based on the closing price of HK$0.18 per Share as quoted on the Stock Exchange on the Last Trading Day;
5. a discount of approximately 56.15% to the audited consolidated net asset value per Share of approximately HK$0.3193 (based on the latest published consolidated net asset value of the Group of approximately HK$278.2 million as disclosed in the annual report of the Company for the year ended 31 December 2020 and 871,178,000 Shares in issue as at the date of this announcement); and
6. a theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) represented by a discount of approximately 7.39%, represented by the theoretical diluted price of approximately HK$0.1667 per Share to the benchmarked price of approximately HK$0.18 per Share (as defined under Rule 7.27B of the Listing Rules, taking into account the closing price on the Last Trading Day of HK$0.18 per Share and the average of the closing prices of the Shares as quoted on the Stock Exchange for the five (5) previous consecutive trading days prior to the date of this announcement of approximately HK$0.1774 per Share).

The Subscription Price was determined with reference to, among other things, the recent market prices of the Shares, the current market conditions, and the amount of funds the Company intends to raise under the Rights Issue.

The Directors (including the independent non-executive Directors) consider that the terms of the Rights Issue, including the Subscription Price, are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

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