TA Yang : Announcement pursuant to Rule 3.7 of the Takeovers Code, Rule 13.09 of the Listing Rules and Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance and Resumption of Trading

E160129A_Ta Yang 1..6

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.

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)

ANNOUNCEMENT PURSUANT TO RULE 3.7 OF THE TAKEOVERS CODE, RULE 13.09 OF THE LISTING RULES AND INSIDE INFORMATION PROVISIONS UNDER PART XIVA OF

THE SECURITIES AND FUTURES ORDINANCE AND

RESUMPTION OF TRADING

Reference is made to the announcement of the Company dated 13 January 2016 in respect of trading halt in Shares on the Stock Exchange in relation to an inside information regarding the disposal of Shares by the Controlling Shareholder.

MOU IN RESPECT OF THE POSSIBLE TRANSACTION

The Board wishes to announce that, after trading hours on 12 January 2016, the Company was informed by the Controlling Shareholder (as intended vendor), that it has entered into the MOU with the Potential Purchaser. To the best knowledge, information and belief of the Directors, the Potential Purchaser and its shareholders are not connected persons of the Company and are independent third parties. The MOU sets forth the understanding and certain preliminary terms in relation to the Possible Transaction.

POSSIBLE GENERAL OFFER FOR THE SHARES

Subject to the Definitive Agreement in relation to the Possible Transaction being entered into, if the Possible Transaction materialises, the Potential Purchaser will acquire not less than 425,150,400 Shares (representing approximately 54.5% of the voting rights of the Company as at the date of the MOU, and not less than approximately 53.8% of the voting rights in the Company taking into account of the Shares which may fall to be allotted and issued upon the exercising of subscription rights attaching to the share options granted by the Company by the holders thereof during the Exclusivity Period), giving rise to an obligation on the part of the Potential Purchaser and any parties acting in concert with it to make a mandatory unconditional general offer for all the Shares (other than those already owned or agreed to be acquired by them) under Rule 26.1 of the Takeovers Code. Such offer, if made, is expected to be in cash.

There is no assurance that the Possible Transaction will materialise or eventually be consummated. Shareholders and potential investors of the Company should be aware that the terms of the Possible Transaction are subject to further negotiations between the Controlling Shareholder and the Potential Purchaser, and the completion of the Possible Transaction is subject to the Definitive Agreement being entered into and the satisfaction (or, as the case may be, waiver) of such conditions precedent to completion as may be specified therein. The Possible Transaction and the possible general offer arising from the Possible Transaction may or may not proceed.

Shareholders and potential investors of the Company are advised to exercise extreme caution when dealing in the Shares of the Company and if they are in any doubt about their position, they should consult their professional adviser(s).

RESUMPTION OF TRADING OF SHARES

At the request of the Company, trading in the Shares had been halted on the Stock Exchange with effect from 9: 00 a.m. on Wednesday, 13 January 2016 pending the release of this announcement. An application has been made by the Company to the Stock Exchange for resumption of trading in its Shares with effect from 9: 00 a.m. on 14 January 2016.

This announcement is made by Ta Yang Group Holdings Limited (the ''Company'', together with its subsidiaries, the ''Group'') pursuant to Rule 3.7 of the Hong Kong Code of Takeovers and Mergers (the ''Takeovers Code''), Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the ''Listing Rules'') and the Inside Information Provisions (as defined under the Listing Rules) under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).

Reference is made to the announcement of the Company dated 13 January 2016 in respect of trading halt in shares of the Company (''Shares'') on The Stock Exchange of Hong Kong Limited (the''Stock Exchange'') in relation to an inside information regarding the disposal of Shares by the Controlling Shareholder (as defined below).

MOU IN RESPECT OF THE POSSIBLE TRANSACTION

The board of directors (the ''Board'') of the Company wishes to announce that, after trading hours on 12 January 2016, the Company was informed by Mr. Huang Sheng-Shun, an executive director of the Company and chairman of the Board (''Controlling Shareholder''), and the controlling shareholder (as defined in the Listing Rules) of the Company which is interested in an aggregate of 461,510,000 Shares in person and through a trust set up by him, with himself and his family members as beneficiaries, that he has entered into the memorandum of understanding (the ''MOU'') as intended vendor with a potential purchaser (the ''Potential Purchaser'', who together with the Controlling Shareholder are collectively referred to as the ''Parties'' in relation to the Possible Transaction (as defined below)) on 12 January 2016.

To the best knowledge, information and belief of the Directors, the Potential Purchaser and its shareholders are not connected persons (as defined in the Listing Rules) of the Company and are independent third parties. The MOU sets forth the understanding and certain preliminary terms in relation to the Possible Transaction.

The Possible Transaction

As informed by the Controlling Shareholder, pursuant to the MOU, the Controlling Shareholder intends to sell and procure the sale of and the Potential Purchaser intends to purchase not less than 425,150,400 Shares (of which 46,314,000 Shares are held by the Controlling Shareholder in person and 413,940,000 Shares were indirectly held by corporations controlled by him) (the ''Possible Transaction''), which represents not less than approximately 54.5% of the Shares in the Company as at the date of the MOU, and not less than approximately 53.8% of the voting rights in the Company taking into account of the Shares which may fall to be allotted and issued upon the exercising of subscription rights attaching to the share options granted by the Company by the holders thereof during the Exclusivity Period) (''Proposed Sale Interest''). The payment method of the purchase price for the Proposed Sale Interest will be subject to further negotiations between the parties to the MOU and be set out in a legally binding definitive agreement (the ''Definitive Agreement'') to be entered into (if entered into at all) between the Controlling Shareholder (as vendor) and the Potential Purchaser (as purchaser) with respect to the Possible Transaction.

The Controlling Shareholder has also undertaken to procure the Company and its subsidiaries not to issue or agree to issue any new Shares or securities convertible into new Shares during the Exclusivity Period. The Controlling Shareholder also undertook to use his best endeavour to procure the Group to continue its operation in its ordinary course of business and not to carry out material transactions.

Exclusivity

As informed by the Controlling Shareholder, pursuant to the MOU, in consideration of the Potential Purchaser paying an amount of HK$15,000,000 in cash (the ''Ernest Money'') to the Controlling Shareholder, the Potential Purchaser was granted an exclusive right to negotiate with the Controlling Shareholder in relation to the Possible Transaction from the date of the MOU until 3 February 2016 (''Exclusivity Period''). For the avoidance of doubt, the Ernest Money is not refundable in any event, but in the event that a Definitive

Agreement is entered into, the Ernest Money will be applied to settle part of the consideration for the sale and purchase of the Proposed Sale Interest under the Definitive Agreement.

Due diligence on the Group

After the signing of the MOU, the Potential Purchaser is entitled to conduct such reasonable financial and legal due diligence review on the Company and its subsidiaries.

Termination

Unless otherwise extended by the Controlling Shareholders and the Potential Purchaser, the MOU shall be terminated on the earlier of: (a) the date of the execution of the Definitive Agreement; or (b) the end of the Exclusivity Period; or (c) the mutual agreement between the Parties to terminate the MOU. Upon termination of the MOU, none of the Controlling Shareholder and the Potential Purchaser shall have any further obligations under the MOU except for those provisions dealing with confidentiality, notices and governing law and jurisdiction which shall survive termination.

Binding force of the MOU

The provisions relating to compliance with applicable laws, exclusivity, Ernest Money, confidentiality, costs, termination, notices, third parties' rights, governing law and jurisdiction contained in the MOU are legally binding. Save and except for these provisions, other provisions of the MOU do not have any legally binding effect.

POSSIBLE GENERAL OFFER FOR THE SHARES

Subject to the Definitive Agreement in relation to the Possible Transaction being entered into, if the Possible Transaction materialises, the Potential Purchaser will acquire not less than 425,150,400 Shares (presenting approximately 54.5% of the voting rights of the Company as at the date of the MOU, and not less than approximately 53.8% of the voting rights in the Company taking into account of the Shares which may fall to be allotted and issued upon the exercising of subscription rights attaching to the share options granted by the Company by the holders thereof during the Exclusivity Period), giving rise to an obligation on the part of the Potential Purchaser and any parties acting in concert with it to make a mandatory unconditional general offer for all the Shares (other than those already owned or agreed to be acquired by them) under Rule 26.1 of the Takeovers Code. Such offer, if made, is expected to be in cash.

The terms of the Possible Transaction are subject to (i) further negotiation between the Controlling Shareholder and the Potential Purchaser and (ii) the Definitive Agreement being entered into. If the Definitive Agreement is not entered into before the expiry of the Exclusivity Period, an announcement will be made by the Company to inform the market in due course in accordance with the Takeovers Code.