Man Wah Holdings Limited announced that the Company established a new company in Caidian District, Wuhan City, the PRC and entered into the State-owned Construction Land Use Rights Grant Contract with the local government on 13 January 2022. Pursuant to the Contract, the Company will construct a manufacturing base in Wuhan City, the PRC which will serve as the Company's headquarters in Central China (the "Project"). The Project involves a total of 297 mu of industrial land, and is mainly used for the research and development, manufacturing and sales of smart home products such as smart sofas, smart mattresses, bed frames and custom-made furniture.

The Project will be funded by internal resources of the Company. The Board considers that the main purpose of this investment is to cater for the fast-growing market demand in the PRC, increase production capacity and facilitate the Group's construction and business development in Central China in order to better respond toconsumer needs. Secondly, the Project can also solve the supply problem in Central China to reduce logistics costs and enhance the Group's overall competitiveness in the domesticmarket.

As all the relevant applicable percentage ratios for the transaction under the Project investment are less than 5%, the transaction under the Project investment does not constitute a notifiable transaction of the Company under Chapter 14 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.