THE PROPOSED ACQUISITION BY THE COMPANY OF THE ENTIRE ISSUED AND PAID-UP SHARE CAPITAL OF REGAL INTERNATIONAL HOLDINGS PTE. LTD.

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1 THE PROPOSED ACQUISITION BY THE COMPANY OF THE ENTIRE ISSUED AND PAID-UP SHARE CAPITAL OF REGAL INTERNATIONAL HOLDINGS PTE. LTD. 1. INTRODUCTION 1.1. The Board of Directors (the Board ) of Hisaka Holdings Ltd. (the Company and together with its subsidiaries, the Group ) refers to the announcements dated 24 July 2013, 20 September 2013, 30 October 2013 and 29 November 2013 (collectively, the Announcements ) wherein the Company announced, inter alia, that the Company had entered into a memorandum of understanding dated 24 July 2013 with Mr Su Chung Jye, Mr Wong Pak Kiong and Mr Low Yew Shen and Temasek Regal Capital Sdn Bhd ( Regal Capital ) in relation to the proposed acquisition by the Company of the entire issued and paid-up share capital of Regal Capital, and the extension of the timeframe for the entry by the Parties into a definitive agreement in respect of the Proposed Acquisition (as defined below in paragraph 1.2) Definitive Agreement Further to the Announcements, the Board is pleased to announce that the Company had on 20 December 2013 entered into a conditional sale and purchase agreement (the SPA ) with Mr Su Chung Jye, Mr Wong Pak Kiong, Mr Low Yew Shen and Ikram Mahawangsa Sdn Bhd (collectively, the Vendors ) (the Company and Vendors, collectively the Parties and each a Party ) for the proposed acquisition by the Company of the entirety of the issued and paid up shares of Regal International Holdings Pte. Ltd. (the Sale Shares ). Regal International Holdings Pte. Ltd. ( Regal International ) will be a holding company of, amongst others, Regal Capital. As at the date of this announcement, Regal International has an issued and paid-up share capital of S$10,000 comprising 10,000 ordinary shares. The Company shall purchase the Sale Shares from the Vendors for an aggregate consideration of S$127,250,000 (the Consideration ) which shall be satisfied: (a) (b) by way of S$20,000,000 in cash; and the remainder, by way of the allotment and issuance of the Consideration Shares (as defined in paragraph 2.3.2(c) below) at the Issue Price (as defined in paragraph 2.3.2(b) below) (the Proposed Acquisition ); In connection with the Proposed Acquisition, the Company proposes to undertake the Proposed Share Consolidation (as defined in paragraph below). The shareholders of the Company (the Shareholders ) are advised to read this announcement carefully and in its entirety, in particular, the Cautionary Statement as set out in paragraph 12 of this announcement. 1 Pg1 of 18

2 2. THE PROPOSED ACQUISITION 2.1. Information on Regal International and the Vendors Regal International and its subsidiaries (collectively referred to as the Target Group or Target Group Companies and whereby Target Group Company shall mean any one of them) (a) Regal International and Regal Capital are both investment holding companies incorporated in Singapore and Malaysia respectively. Regal International will acquire 100% of Regal Capital and Regal Capital will acquire the following interests in the following companies prior to completion of the sale and purchase of all the Sale Shares (the Completion ): (i) (ii) (iii) (iv) (v) (vi) (vii) 100% of Regal Advantage Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of property development; 100% of Beaches and Coastline Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of property development; 100% of Bellanova Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of property development; 100% of Kenyalang Avenue Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of construction and property development; 100% of Upright Strategy Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of construction and property development ; 100% of Temasek Cartel Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of marketing of real estate and property development; 100% of Sang Kanchil Rising Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of rental of machinery; (viii) 100% of Regal Materials Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of trading of construction material; (ix) (x) (xi) (xii) 100% of Beneworld Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of mortgage consultancy; 100% of Regal Lands Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of investment in properties and property development; 100% of Arena Wiramaju Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of property development; 100% of Midas Residences Sdn Bhd, a company incorporated in Malaysia and which principally engages in the business of property development; (xiii) 100% of Ocean Megalink Sdn Bhd, a company incorporated in Malaysia and which 2 Pg2 of 18

3 principally engages in the business of property development; (xiv) 50% of Tiya Development Sdn Bhd, a company incorporated in Malaysia and which engages in the business of property development; and (xv) 80% interest in Kota Sarjana Sdn Bhd, a company incorporated in Malaysia and which engages in the business of investment in properties, construction and property development. (b) As at the date of the SPA, the shareholders of Regal International, being the Vendors, and their respective shareholdings in Regal International are as follows: Vendors Name Number of % Sale Shares Su Chung Jye 1, Wong Pak Kiong Low Yew Shen Ikram Mahawangsa Sdn Bhd 7, , The information relating to each Vendor is as follows:- (a) (b) (c) (d) Mr Su Chung Jye is the managing director of Regal Capital; Mr Wong Pak Kiong is the director and head of sales and marketing of Regal Capital; Mr Low Yew Shen is a lawyer practising in Singapore and is a partner of Elitaire Law LLP; and Ikram Mahawangsa Sdn Bhd is an investment holding company incorporated in Malaysia. It is beneficially owned by Mr Su Chung Jye, Mr Wong Pak Kiong and Mr Frederick Eng Meng Khuan in the following proportions: Name Proportion (%) Su Chung Jye Wong Pak Kiong Frederick Eng Meng Khuan None of the Vendors is related to any of the Company s Directors, Chief Executive Officer, controlling Shareholders or their respective associates. As at the date of this announcement, none of the Vendors, save for Mr Low Yew Shen who holds 37,000 shares in the Company, holds shares in the Company Independent Valuation Report in Connection with the Proposed Acquisition In conjunction with the Proposed Acquisition, the Company will appoint an independent professional valuer to undertake a valuation of the business of the Target Group Companies (the Independent Valuation Report ), such report to comply with the relevant requirements of the Singapore Exchange Securities Trading Limited (the SGX-ST ). 3 Pg3 of 18

4 Further information relating to the independent professional valuer to be appointed, together with the Independent Valuation Report (which will include the basis and date of the Independent Valuation Report), will be included in the Circular (as defined in paragraph 10.1 below) to be despatched to Shareholders in due course Key terms of the Proposed Acquisition Proposed Acquisition of the Sale Shares Pursuant to the terms of the SPA, the Vendors have agreed to sell to the Company and the Company has agreed to purchase from the Vendors all the Sale Shares, free from all encumbrances and together with all rights, benefits and entitlements attaching thereto as at Completion Date (as defined in paragraph 2.3.9) Consideration for the Proposed Acquisition (a) (b) (c) The Consideration of S$127,250,000 was arrived at and agreed upon by the parties to the SPA (the Parties and each a Party ) on a willing-buyer and willing-seller basis. The Consideration shall be fixed at S$127,250,000 so long as the revalued net asset value ( RNAV ) of the Target Group (the Target Valuation ), based on the Independent Valuation Report (as defined above in paragraph 2.2), is approximately S$200,000,000. The Consideration may be adjusted in the event that the Target Valuation materially deviates from the abovementioned S$200,000,000 figure either way. A difference of 5% or more either way in the Target Valuation from the abovementioned S$200,000,000 figure shall be considered a material deviation. The Consideration shall be satisfied in full by way of (i) S$20,000,000 in cash upon Completion and (ii) the allotment and issuance of the Consideration Shares (as defined in paragraph 2.3.2(c)) (after the completion of the Proposed Share Consolidation) at the issue price of S$0.55 for each new Consolidated Share (the Issue Price ) to the Vendors. The Consideration Shares shall be an aggregate of 195,000,000 new Consolidated Shares (as defined in paragraph 2.3.3) (the Consideration Shares ) to be allotted and issued by the Company to the Vendors at the Issue Price on Completion Date in consideration for the acquisition of the Sale Shares, such shares to rank pari passu in all respects with the then existing Consolidated Shares. Upon Completion, including the allotment and issuance of the Consideration Shares and Arranger Shares (as defined in paragraph below), the Vendors will collectively hold 195,000,000 Consolidated Shares, representing approximately 65% of the enlarged share capital of the Company Proposed Share Consolidation Under Rule 1015(3)(d) of the Listing Manual of the SGX-ST (the Listing Manual ), the issue price of each share after adjusting for any share consolidation must not be lower than S$0.50. Accordingly, in connection with the Proposed Acquisition and subject to the approval of the Shareholders, the Company proposes to undertake a share consolidation of two (2) ordinary shares of 4 Pg4 of 18

5 the Company (the Shares ) into one (1) new Share (the Consolidated Share ) to be effected before Completion (the Proposed Share Consolidation ) Conditions Precedent The obligation of the Company and the Vendors to complete the Proposed Acquisition is conditional upon the following:- (a) (b) (c) (d) (e) (f) (g) The Company obtaining such approval(s) from the Board in connection with the SPA and the transactions contemplated therein as may be necessary; The Vendors (who are not individuals) obtaining such approval(s) from its board of directors and/or shareholders (where applicable) in connection with the SPA and the transactions contemplated therein as may be necessary; Regal International obtaining such approval(s) from the board of directors of Regal International in connection with the SPA and the transactions contemplated therein as may be necessary, including for the transfer of the Sale Shares to the Company; The Company being satisfied, by the date of the submission of the draft Circular to the SGX-ST in relation to the acquisition of the Sale Shares provided in the SPA, with the results of the due diligence (whether legal, financial, contractual, tax or otherwise) to be carried out by the Company and/or its advisers on Regal International and the contents of the disclosure letter to be provided by the Vendors on, including without limitation the title to and the status and condition of any properties (whether movable or immovable), assets (whether tangible or intangible), liabilities, businesses, operations, records, financial position, accounts, results, legal and corporate structure, its subsidiaries and associated companies, and any other information disclosed to the Company; The receipt by the Company of the disclosure letter from the Vendors, delivered to the Company within ninety (90) days after the signing of the SPA and any supplemental disclosure letter(s) to the aforesaid disclosure letter from the aforesaid deadline of ninety (90) days from the signing of the SPA to prior to Completion, and which discloses information relating to the warranties contained in the SPA, and the Company being satisfied with the contents thereof of the disclosure letter; The rectification, or the procurement of such rectification, to the reasonable satisfaction of the Company by the Vendors, of all issues or irregularities uncovered by the Company which are material in the context of the Proposed Acquisition during the Company s due diligence investigations on Regal International and/or its subsidiaries; The Vendors being satisfied, by the date of the submission of the draft Circular to the SGX-ST, with the results of the due diligence (whether legal, financial, contractual, tax or otherwise) (the Vendors Due Diligence Investigations ) to be carried out by the Vendors and/or their advisers on the Company, including without limitation the title to and the status and condition of any properties (whether movable or immovable), assets (whether tangible or intangible), liabilities, businesses, operations, records, financial position, accounts, results, legal and corporate structure, its subsidiaries and associated companies, and any other information disclosed to the Vendors; 5 Pg5 of 18

6 (h) (i) (j) The receipt by the Vendors of the disclosure letter from the Company (the Purchaser s Disclosure Letter ), delivered to the Vendors within ninety (90) days after the signing of the SPA and any supplemental Purchaser's Disclosure Letter(s) to the aforesaid Purchaser s Disclosure Letter from the aforesaid deadline of ninety (90) days from the signing of the SPA to prior to Completion, and which discloses information relating to the warranties contained in the SPA, and the Vendors being satisfied with the contents thereof of the Purchaser s Disclosure Letter; The Securities Industry Council (the SIC ) having granted the Vendors and their concert parties (and not having revoked or repealed such grant) a waiver of their obligation to make a mandatory offer under Rule 14 of the Singapore Code on Takeovers and Mergers (the Code ) for the shares in the Company not held by the Vendors and their concert parties and from having to comply with the requirements of Rule 14 of the Code including but not limited to preclearance from the SIC on any issues in connection with the Proposed Acquisition that the Vendors and/or the Company may consider necessary, subject to (i) any conditions that the SIC may impose, provided that such conditions are reasonably acceptable to the Vendors and their concert parties; and (ii) the Independent Shareholders approving the Whitewash Resolution at a general meeting of the Company. In this announcement, Independent Shareholders means Shareholders of the Company other than (i) the Vendors; (ii) persons acting in concert with the Vendors; and (iii) persons not considered independent of the persons mentioned in (i) and (ii) of this definition for the purpose of the Whitewash Resolution, and Whitewash Resolution means the proposed ordinary resolution of the Company which if passed by the Independent Shareholders would result in a waiver by the Independent Shareholders of their right to receive a mandatory general offer from the Vendors and parties acting in concert with the Vendors in connection with the issue of the Consideration Shares under the Proposed Acquisition; The Company receiving the following approvals from its Shareholders at an extraordinary general meeting to be convened, for: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) the approval for the Share Consolidation; acquisition of the Sale Shares for the Consideration; the allotment and issue of the Consideration Shares to the Vendors (or to such nominees as the Vendors may direct); the allotment and issue of the Arranger Shares to the Arranger (or to such nominees as the Arranger may direct); change of the Company s name to such name as the Vendors may decide; the grant of a general mandate for the issue of new Consolidated Shares; the appointment of such persons as may be nominated by the Vendors in their sole discretion onto the Company s Board of Directors, such appointments taking effect upon Completion; the Whitewash Resolution; and all such other approvals required from the Company s shareholders, 6 Pg6 of 18

7 in connection with the SPA and the transactions contemplated therein as may be necessary; (k) (l) (m) (n) (o) (p) (q) (r) (s) (t) The Vendors and Company not having received notice of any injunction or other order, directive or notice restraining or prohibiting the consummation of the transactions contemplated by the SPA, and there being no action seeking to restrain or prohibit the consummation thereof, or seeking damages in connection therewith, which is pending or any such injunction, other order or action which is threatened; An opinion from an independent financial adviser of the Company expressing an opinion containing a recommendation by the independent financial adviser to the relevant directors of the Company to recommend to the Shareholders to vote in support of the Whitewash Resolution; The Proposed Acquisition upon the terms of the SPA being approved by the SGX-ST and/or any other relevant authorities and where such approval is obtained subject to any conditions, such conditions being reasonably acceptable to the Parties; There being no material breach by any Party of the representations, warranties, covenants and indemnities contained in the SPA; The Company being satisfied in its reasonable discretion that there has been no material adverse change, or events, acts or omissions likely to lead to such a material change, in the business, assets, prospects, performance, financial position or results of operations of Regal International from the date of the SPA; The procurement by the Vendors of the delivery by Regal International of the audited accounts of Regal International to the Company following the completion of a financial audit on Regal International conducted by a public accounting firm acceptable to the Purchaser and restated by a public accounting firm recognised by the Institute of Singapore Chartered Accountants in accordance with the International Financial Reporting Standards and such other applicable legislation and regulations in connection with the transactions contemplated under the SPA; There being no delisting or suspension of the existing shares of the Company from the SGX-ST prior to and on the Completion Date; The Target Group Companies having achieved a net profit after tax of at least the equivalent of S$7,000,000 for the financial year ending 31 December 2013, based on the audited accounts of the Target Group Companies for the financial year ended 31 December 2013 but before taking into account the financial effects of the costs, expenses or fees arising from or in connection with the Proposed Acquisition; Approval-in-principle being received from the SGX-ST for the dealing in and quotation for the Consolidated Shares, the Consideration Shares and the Arranger Shares on the Main Board of the SGX-ST, such approval not being revoked, rescinded or cancelled prior to Completion and, where such listing and quotation notice is obtained subject to any conditions, such conditions being reasonably acceptable to the Vendors and the Company as confirmed by the Parties; The receipt by the Company of service agreements duly executed by the key members of the management of Regal International who are currently employed or engaged as may be 7 Pg7 of 18

8 identified and mutually agreed between the Parties in form and substance satisfactory to the Company; (u) (v) (w) (x) (y) (z) Each of the warranties and undertakings in the SPA remaining true and not misleading in any material respect at Completion, as if repeated at Completion and at all times between the date of the SPA and Completion; The approval in-principle being obtained from the SGX-ST for the Circular and the compliance by the Company of all the conditions which may be imposed by the SGX-ST in connection thereto; The allotment, issue and subscription of the Consideration Shares not being prohibited by any statute, order, rule, regulation, directive or request promulgated or issued by any legislative, executive or regulatory body or authority of Singapore or elsewhere, which is applicable to Regal International and/or the Company; The Share Consolidation being duly effected to the satisfaction of the Parties; The Company shall have at least S$5,000,000 in cash in its bank accounts as at the Completion Date upon the Completion and that such cash shall not be subject to any encumbrances provided always that should there be any accrued directors fees as at the Completion Date, the said amount shall be increased by the amount of any accrued directors fees. For the avoidance of doubt, the aforementioned sum in this sub-paragraph (y) shall not include any proceeds which have been raised from previous fund raising exercises of the Company, which include the listing and quotation of the shares of the Company on the SGX-ST and the listing and quotation of the Taiwan Depository Receipts on the Taiwan Stock Exchange by the Company; The Restructuring being completed to the reasonable satisfaction of the Company. The Restructuring means the restructuring exercise relating to Regal International involving the injection of the subsidiaries as listed in paragraph 2.1.1(a) above; (aa) (i) All approvals, authorisations, clearances, confirmations, consents, exemptions, grants, licences, orders, permissions, recognitions and waivers as may be required or appropriate for or in connection with the sale and purchase of the Sale Shares or the transactions contemplated in the SPA and to carry on the business of the Target Group Companies from all relevant government, governmental, quasi-governmental, supranational, statutory, regulatory, administrative, fiscal or judicial agency, authority, body, court, commission, department, exchange, tribunal or entity in any jurisdiction having been obtained and not withdrawn or revoked, and where any such approvals, authorisations, clearances, confirmations, consents, exemptions, grants, licences, orders, permissions, recognitions and waivers are obtained subject to any conditions, such conditions being reasonably acceptable to the Parties; and (ii) all necessary or appropriate filings having been made and all appropriate waiting periods (including any extensions thereof) under any applicable legislation or regulation of any jurisdiction having expired, lapsed or been terminated, in each case for or in connection with the sale and purchase of the Sale Shares and to carry on the business of the Target Group Companies; and (bb) Where the terms of any material contract to which any Target Group Company is subject contain any restriction or prohibition on the change in the shareholding and/or the boards of 8 Pg8 of 18

9 directors of any Target Group Company or include any right to terminate exercisable prior to or as a result of any matter contemplated by this Agreement, written approval or consent or written confirmation of the waiver from third parties of such restrictions or prohibition in relation to any such change arising from the transactions under this Agreement or of any such right to terminate having been obtained or fulfilled Undertaking, Representations and Warranties The Proposed Acquisition is subject to such further undertakings, representations and warranties from the Company and each of the Vendors as are customary for transactions of similar nature Waiver of Conditions Precedent At any time on or before the Completion Date, the Company and/or the Vendors may waive any of the above conditions precedent (subject to whether such condition precedent is capable of being waived by the Parties) by written notice to the Vendors and/or the Company (as the case may be) Arranger Shares The Parties have agreed that, subject to Completion, the Company shall issue an aggregate of 17,500,000 new Consolidated Shares (the Arranger Shares ) at the Issue Price (of S$0.55 per Consolidated Share) to Cresco Investments Pte. Ltd. (the Arranger ) as consideration for assisting the Company in, inter alia, identifying businesses for potential acquisitions pursuant to a consultancy agreement dated 4 April 2013 executed by the Company with the Arranger. For the avoidance of doubt, the Arranger Shares shall be issued after the Share Consolidation and any other consolidation of the Company s share capital that may be undertaken in connection with the Proposed Acquisition. The Arranger was incorporated in Singapore on 9 November 2012, and is principally engaged in the business of providing consultancy services. It has an issued and paid-up share capital of S$300,000 comprising 300,000 ordinary shares. The sole shareholder and director of the Arranger is Mr. Andrew Quah Tzy Ming, a private investor who has previously held various positions in the legal, banking and fund management industries Long-Stop Date If any of the conditions precedent is not fulfilled or, subject to the relevant provisions in the SPA, waived by mutual consent of the Parties by the date falling twelve (12) months from the date of the SPA or such further date as the parties may agree in writing (the Long Stop Date ), the SPA shall ipso facto cease and determine and (save for any antecedent breach of the SPA) no Party shall have any claim against the other Parties for costs, damages, compensation or anything whatsoever Completion Date The Proposed Acquisition will be completed on the date falling within seven (7) days after the fulfillment of all of the conditions precedent provided in the SPA, unless they are waived by the relevant Parties, on which Completion takes place (the Completion Date ). 9 Pg9 of 18

10 Moratorium Each of the Vendors covenants and undertakes to the Company that they shall execute, and shall procure their respective nominees (which each of them may direct the Company to issue the Consideration Shares) to execute, such moratorium undertakings not to dispose of, realise or transfer any of the Consideration Shares which may be issued on Completion as required under Rules 229 and 1015(3)(c) of the Listing Manual, unless the same is not required by the SGX-ST or as may be otherwise imposed by the SGX-ST The Proposed Acquisition as a Very Substantial Acquisition or Reverse Takeover The relative figures of the Proposed Acquisition computed on the bases set out in Rule 1006(a) to (e) of the Listing Manual are as follows:- Rule 1006(a) Net asset value ( NAV ) of the assets to be disposed of, compared with the Group s NAV. Not applicable to an acquisition Rule 1006(b) Net profits attributable to the assets acquired or disposed of (1), compared with the Group s net profits. 118% (2) Rule 1006(c) Aggregate value of the consideration given, compared with the Company s market capitalisation based on the total number of issued Shares excluding treasury shares. 371% (3) Rule 1006(d) The number of securities issued by the Company as consideration for the Proposed Acquisition, compared with 222% (5) the number of equity securities previously in issue (4) Rule 1006(e) The aggregate volume or amount of proved and probable reserves to be disposed of, compared with the aggregate of the group's proved and probable reserves. This basis is applicable to a disposal of mineral, oil or gas assets by a mineral, oil and gas company, but not to an acquisition of such assets. Not applicable Notes:- (1) The net profits attributable to the assets acquired amounted to approximately RM783,000 for the financial year ended 31 December 2012, based on the unaudited consolidated net profit before tax of the Target Group Companies. (2) The relative figure is calculated based on the net profits attributable to the assets acquired for the financial year ended 31 December 2012, and the net profits before tax of the Group of S$269,000 based on the unaudited consolidated financial statements of the Group for the financial year ended 30 September (3) The market capitalisation of the Company of approximately S$34,297,096 was determined by multiplying the existing number of issued Shares of the Company of 175,343,026 Shares (pre-consolidation) by the volume-weighted average price of the Shares of S$ per Share transacted on 19 December 2013, being the last market day immediately preceding the date of the SPA. (4) Please note that the issuance of Arranger Shares is considered an expense to be incurred in connection with the Proposed Acquisition and is therefore not included as part of the consideration for the Proposed Acquisition. (5) The relative figure under Rule 1006(d) was determined by dividing the number of Consideration Shares, being 10 Pg10 of 18

11 195,000,000 Consolidated Shares, by 87,671,513 Consolidated Shares (assuming that the Proposed Share Consolidation has taken place and based on the number of the existing issued Shares of the Company of 175,343,026 Shares). As the relative figures under Rules 1006(c) and 1006(d) of the Listing Manual exceed 100% and the Proposed Acquisition would result in a change in control of the Company, the Proposed Acquisition constitutes a Reverse Takeover as set out in Rule 1015 of the Listing Manual. Accordingly, the Proposed Acquisition shall be conditional upon, inter alia, the approval of the SGX- ST and the Shareholders being obtained pursuant to Rule 1015 of the Listing Manual Waiver from a General Take-over Offer from the Securities Industry Council As the Vendors will own more than 30% of the enlarged voting share capital of the Company upon completion of the Proposed Acquisition, the Vendors and their concert parties will be required, under Rule 14 of the Code, to make a general offer for the remaining Consolidated Shares not owned or controlled by the Vendors and their concert parties at the highest price paid or agreed to be paid by any of them for the Consolidated Shares in the preceding six (6) months. It is a condition precedent of the Proposed Acquisition that the SIC grants the Vendors and their concert parties, and does not revoke or repeal such grant, a waiver of their obligation to make a general offer under Rule 14 of the Code for all the Consolidated Shares not held by them and their concert parties. The Independent Shareholders must however approve a resolution for the waiver of their right to receive such a mandatory offer from the Vendors and their concert parties at the extraordinary general meeting of the Shareholders to be convened for the purpose of approving, inter alia, the Proposed Acquisition. 3. RATIONALE FOR THE PROPOSED ACQUISITION The Directors believe that the Proposed Acquisition is an investment opportunity that would be in the best interests of the Company. Although the Group had been profitable in the previous financial years ended 30 September 2012 and 2013, it recorded slim net profits after tax of approximately S$0.4 million for each financial year. The Board believes that the core industry sector in which the Group operates, being the semi-conductor sector, has been volatile and challenging, and will continue to remain so with no imminent signs of recovery. While the Group continues to deliver a healthy balance sheet, the Board expects the financial year ending 30 September 2014 to remain challenging for the Group. The Company believes that the Proposed Acquisition represents a good opportunity for the Group to expand and diversify its businesses and operations, which will allow it to achieve more consistent and sustainable financial growth. The Proposed Acquisition, if successful, will augment the existing business of the Group and will provide the Group with the opportunity to participate in the property development business. It is expected that the business potential and prospects of the Company will improve. Furthermore, the future plans of the Target Group Companies involve the expansion of its current property development business in Kuching, Sarawak and expansion of its property development business to other areas outside Kuching, Sarawak. This would further enhance the prospect for the Group. The Company also believes that the Proposed Acquisition will be beneficial for the Group as, following 11 Pg11 of 18

12 the issue of the Consideration Shares, the Company s market capitalisation will increase substantially, which will potentially widen the investor base and lead to an overall increase in investors interest and trading of the shares of the Company. 4. PROFORMA FINANCIAL INFORMATION OF THE TARGET GROUP COMPANIES The unaudited proforma combined financial statements of the Target Group Companies for the financial years ended 31 December 2010, 2011 and 2012, have been prepared using the Completed- Contract Method and restated in accordance with the International Financial Reporting Standards ( IFRS ). The unaudited proforma combined financial information of the Target Group Companies was prepared on the basis that the disposal of certain subsidiaries and/or associated companies which were not included as Target Group Companies had been completed prior to 1 January A summary of the unaudited proforma combined financial information of the Target Group Companies for the financial years ended 31 December 2010, 2011 and 2012 is set out below:- Proforma Income Statements (RM 000) Financial year ended 31 Dec 2010 Unaudited Financial year ended 31 Dec 2011 Financial year ended 31 Dec 2012 Revenue 12,424 32,119 7,833 Gross profit 1,957 7,641 3,874 (Loss) / Profit before (1,217) 3, tax Income tax expense Net (loss) / profit after tax (1,217) 2, Proforma Balance Sheet Unaudited (RM 000) As at 31 Dec 2012 Current assets 133,897 Non-current assets 14,672 Total assets 148,569 Current liabilities 143,919 Non-current liabilities 764 Total liabilities 144,683 Shareholders equity 3,886 The proforma combined financial statements of the Target Group Companies for the financial year ending 31 December 2013, prepared on the basis that the disposal of certain subsidiaries and/or associated companies which were not included as Target Group Companies had been completed prior to 1 January 2010, will also be set out in the Circular. 12 Pg12 of 18

13 5. PROFORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP (THE ENLARGED GROUP ) The Company prepares its financial statements based on a financial year end of 30 September and the latest announced unaudited consolidated financial statements of the Group are for the financial year ended 30 September The Company notes that the Target Group Companies proforma combined financial statements for the financial period ended 30 September 2013 are unavailable as its accounts are prepared based on the different financial year end (i.e. 31 December) and as such, the latest available unaudited proforma combined financial statements of the Target Group Companies are for the financial year ended 31 December Accordingly, the proforma financial information of the Enlarged Group has been prepared, for illustrative purposes only, based on the unaudited consolidated financial statements of the Group for the financial year ended 30 September 2013 and the latest available unaudited proforma combined financial statements of the Target Group Companies for the financial year ended 31 December Proforma Income Statements (S$ 000) 30 Sep 2013 (1) Revenue 37,196 Gross profit 9,639 Profit before tax 583 Income tax expenses 4 Net profit after tax 579 Proforma Balance Sheet (S$ 000) 30 Sep 2013 (1) Non-current assets 8,790 Current assets 80,522 Current liabilities 62,913 Non-current liabilities 364 Shareholders equity 26,035 Note:- (1) The proforma financial information below has been prepared based on the unaudited consolidated financial statements of the Group for the financial year ended 30 September 2013 and the latest available unaudited proforma combined financial statements of the Target Group Companies for the financial year ended 31 December The proforma combined financial statements of the Target Group Companies and the unaudited proforma financial statements of the Enlarged Group will be reviewed by the Company s independent reporting accountants, and set out in the Circular. Shareholders should note that the figures set out above may vary from the final unaudited consolidated proforma financial statements of the Enlarged Group due to certain adjustments that may arise. 13 Pg13 of 18

14 Following the completion of the Proposed Acquisition, the Group shall adopt the financial year ending 31 December. The proforma financial information of the Enlarged Group prepared on a 12-month basis for the financial year ending 31 December 2013 will also be reviewed by the Company s independent reporting accountants, and set out in the Circular. 6. PROFORMA FINANCIAL EFFECTS OF THE PROPOSED ACQUISITION The proforma financial effects of the Proposed Acquisition are set out below Bases and Assumptions The proforma financial effects have been prepared based on the unaudited consolidated financial statements of the Group for the financial year ended 30 September 2013, and the latest available unaudited proforma combined financial information of the Target Group Companies for the financial year ended 31 December The proforma financial effects of the Proposed Acquisition are for illustrative purposes only and do not necessarily reflect the actual results and financial position of the Group immediately following the completion of the Proposed Acquisition. For the purposes of illustrating the financial effects of the Proposed Acquisition, the financial effects have been prepared based on, inter alia, the following assumptions:- (a) (b) (c) (d) (e) (f) the financial effects of the Proposed Acquisition on the earnings and earnings per share ( EPS ) of the Group are computed assuming that the Proposed Acquisition were completed on 1 October 2012; the financial effects of the Proposed Acquisition on the NTA of the Group are computed assuming that the Proposed Acquisition was completed on 30 September 2013; completion of the Proposed Share Consolidation; based on the above assumptions, and assuming an aggregate of 195,000,000 new Consolidated Shares were issued at the Issue Price (of S$0.55 per Consolidated Share) on 30 September 2013 for the purpose of calculating the financial effects of the Proposed Acquisition on the NTA per share of the Company and on 1 October 2012 for the purpose of calculating the financial effects of the Proposed Acquisition on the EPS of the Company; expenses in connection with the Proposed Acquisition are disregarded for the purposes of calculating the financial effects. The issuance of the Arranger Shares is considered an expense to be incurred in connection with the Proposed Acquisition and is disregarded for the purposes of calculating the financial effects; and the fair value adjustments on the net assets of the Company and positive or negative goodwill arising from the Proposed Acquisition, if any, have not been considered for the purpose of computing the financial effects of the Proposed Acquisition and will be determined on the Completion Date when the Vendors have effectively obtained control of the Company. As the final goodwill will have to be determined at completion of the Proposed Acquisition, the actual goodwill could be materially different from the aforementioned assumption. Any goodwill arising thereon from the Proposed Acquisition will be accounted for in accordance with the accounting policies of the Company. 14 Pg14 of 18

15 6.2. Share Capital As at the date of this announcement (excluding treasury shares) After the Proposed Share Consolidation (excluding treasury shares) Number of Shares Amount (SS$ 000) 175,343,026 27,024 87,671,513 27,024 Add: Consideration Shares 195,000, ,250 After completion of Proposed Acquisition (excluding treasury shares) 282,671, , EPS Profit attributable to shareholders (S$ 000) Before the Proposed Acquisition After the Proposed Acquisition Number of issued Shares 175,343, ,671,513 Profit per Share (Singapore cents) NTA NTA (1) of the Group as at 30 September 2013 (S$ 000) Before the Proposed Acquisition After the Proposed Acquisition 44,445 26,035 Number of issued Shares 175,343, ,671,513 NTA per Share (Singapore cents) Note:- (1) NTA is calculated as net assets less intangible assets. 15 Pg15 of 18

16 6.5. Gearing Net debts as at 30 September 2013 (S$ 000) Shareholders equity as at 30 September 2013 (S$ 000) Before the Proposed Acquisition After the Proposed Acquisition (22,549) 56,224 44,445 26,035 Gearing (1) (times) (0.51) 2.16 Note:- (1) Gearing is determined based on the net debt divided by shareholders equity. Net debt is calculated as borrowings plus trade and other payables, less cash and cash equivalent. 7. SHAREHOLDING EFFECTS It is envisaged that, following completion of the Proposed Share Consolidation and the allotment and issuance of the Arranger Shares and the Consideration Shares (collectively, the Proposed Acquisition Transactions ), the shareholding structure of the Company will be as follows:- Shareholder Before the Proposed Share Consolidation and Proposed Acquisition Transactions Number of Shares % After the Proposed Share Consolidation and the Proposed Acquisition Transactions Number of Shares % Existing shareholders of the Company 175,343, ,671, Vendors and concert parties 37,000 (1) 0.0 (2) 195,018, Arrangers ,500, Total 175,380, ,190, Notes: (1) As disclosed in paragraph above, Mr Low Yew Shen, a Vendor, holds 37,000 shares in the Company. 16 Pg16 of 18

17 (2) The percentage shareholding of approximately 0.0% is due to the rounding of the figure. 8. INTERESTS OF DIRECTORS AND CONTROLLING SHAREHOLDERS Save as disclosed in this announcement, none of the directors or controlling shareholders of the Company, and their respective associates, has any interest, direct or indirect, in the Proposed Acquisition other than through their shareholdings in the Company (if any). 9. FINANCIAL ADVISER AND INDEPENDENT FINANCIAL ADVISER The Company has appointed CIMB Bank Berhad, Singapore Branch as its financial adviser in respect of the Proposed Acquisition. The Company will appoint an independent financial adviser to the independent directors of the Company in connection with the Whitewash Resolution in due course. The advice of the independent financial adviser will be set out in the Circular to be despatched to Shareholders in due course. 10. FURTHER INFORMATION Extraordinary General Meeting A circular (the Circular ) setting out information on, inter alia, the Proposed Acquisition, together with a notice of the extraordinary general meeting to be convened will be despatched by the Company to the Shareholders in due course. In the meantime, the Shareholders are advised to refrain from taking any action in relation to their Shares in the Company, which may be prejudicial to their interests until they or their advisers have considered the information and the recommendations to be set out in the Circular Service Contracts As arrangements in relation to the persons who shall be nominated by the Vendors to be appointed as directors of the Company following Completion have not been firmed up as at the date of this announcement, the details of such arrangements will be disclosed in the Circular to be despatched to Shareholders in due course Documents Available for Inspection A copy of the SPA will be made available for inspection during normal business hours at the registered office of the Company at 63, Sungei Kadut Loop, Singapore for a period of three (3) months from the date of this announcement. 11. RESPONSIBILITY STATEMENT The Directors collectively and individually accept full responsibility for the accuracy of the information given in this announcement (save for information relating to the Vendors and the Target Group 17 Pg17 of 18

18 Companies) and confirm after making all reasonable enquiries, that to the best of their knowledge and belief, this announcement constitutes full and true disclosure of all material facts about the Proposed Acquisition, the Company and its subsidiaries and the Directors are not aware of any facts the omission of which would make any statement in this announcement misleading. Where information in this announcement has been extracted from published or otherwise publicly available sources or obtained from a named source, the sole responsibility of the Directors has been to ensure that such information has been accurately and correctly extracted from those sources and/or reproduced in this announcement in its proper form and context. The Vendors collectively and individually accept full responsibility for the accuracy of the information given in this announcement in respect of themselves and the Target Group Companies and confirm, after making all reasonable enquiries, that to the best of their knowledge and belief, this announcement constitutes full and true disclosure of all material facts about themselves and the Target Group Companies, and the Vendors are not aware of any facts the omission of which would make any statement in this announcement relating to themselves and the Target Group Companies misleading. Where information in this announcement in respect of the Vendors and the Target Group Companies has been extracted from published or otherwise publicly available sources or obtained from a named source, the sole responsibility of the Vendors has been to ensure that such information has been accurately and correctly extracted from those sources and/or reproduced in this announcement in its proper form and context. 12. CAUTIONARY STATEMENT The Board would like to advise the Shareholders that, although the SPA has been entered into, completion of the Proposed Acquisition is subject to conditions precedent to be fulfilled and there is no assurance that completion will take place. Accordingly, Shareholders are advised to exercise caution before making any decision in respect of their dealings in the Company s Shares. Shareholders who are in any doubt about this announcement should consult their stockbroker, bank manager, solicitor or other professional adviser. By Order of the Board HISAKA HOLDINGS LTD. Cheng Ee Lieng Chief Executive Officer 20 December Pg18 of 18