FOUNTAIN SET (00420) plans to acquire an 81% stake in a Vietnamese company for approximately $27.945 million.

FOUNTAIN SET (00420) announced that on September 9, 2026 (after trading hours), the buyer Ocean Textile Investment Pte. Limited (a wholly-owned subsidiary of the Company) (as the assignee), the seller Lian-Ta-Hsing International Co., Ltd, and the target company Cng Ty TNHH Lian-Ta-Hsing (Vit Nam) entered into an equity transfer agreement. Accordingly, the seller conditionally agrees to sell, while the buyer conditionally agrees to purchase 81% of the target company's equity for a cash consideration of USD 27.945 million (equivalent to about HKD 219 million), with the remaining 19% of the equity to be held by individuals designated by the seller and approved in writing by the buyer. The target company is a company legally registered and continuously engaged in the production of knitted, dyed, and accessory textile products in Quang Ninh Province, Vietnam, possessing land use rights, fabric production plants, machinery, and other facilities. Upon completion, the target company will become a subsidiary of the Company indirectly holding 81% equity, and the financial performance of the target company will be consolidated into the Group's financial statements. The Group is a global leader in the integrated textile industry, focusing on the construction of its own production capacity and global industrial chain strategic layout for a long time. This acquisition will bring the following main benefits: Strengthening asset quality and creating synergies: The target company is a production and trading company with complete fabric manufacturing and dyeing functions, owning a mature fabric production plant in Quang Ninh Province, with well-equipped facilities and high-quality machinery. Through the acquisition of equity, the Group will immediately obtain core operational assets including plant facilities, production equipment, and workforce. An independent evaluation indicates that these assets have a solid capacity foundation and sustainable operating potential. Enhancing regional capacity and responding to market demand: The Group will instantly acquire a mature production base and management team, significantly shortening the cycle for new capacity investment, rapidly increasing the Group's weaving and dyeing production capacity, effectively responding to the growing global demand for textile products and changes in order flows, and compensating for market share lost due to the industry's supply chain shifting to Southeast Asia. Optimizing industry chain layout and strengthening cost structure: The Group can further enhance its industry chain layout in the Southeast Asia region, fully utilizing Vietnams numerous free trade agreements, robust textile industry chain, abundant labor force, and logistical advantages. This move will enhance regional synergy and raw material short chain operational efficiency, strengthen cost competitiveness and supply chain resilience, and help the Group seize rapid development opportunities in the Southeast Asian textile and apparel market. Promoting overseas development and long-term strategy: The acquisition is in line with the Group's overseas business development strategy and is a key initiative in the Group's overseas capacity layout. By gaining control of the target company, the Group will expand its business scale in Southeast Asia, promote the "going out" of capacity and diversified development, improve the overall capacity layout, establish long-term sustainable profit growth points, and strengthen the global supply chain's risk resistance capabilities.