Sound Global : Announcements and Notices - Announcement Pursuant to Rule 3.7 of the Takeovers Code and Inside Information in Relation to A Possible Privatisation Offer for the Company

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.

SOUND GLOBAL LTD.

桑德國際有限公司*

(Incorporated in the Republic of Singapore with limited liability) (Singapore Company Registration Number 200515422C)

(Hong Kong Stock Code: 00967) ANNOUNCEMENT PURSUANT TO RULE 3.7 OF THE TAKEOVERS CODE AND INSIDE INFORMATION IN RELATION TO A POSSIBLE PRIVATISATION OFFER FOR THE COMPANY

This announcement is made by Sound Global Ltd. (the "Company", together with its subsidiaries, the "Group") pursuant to Rule 3.7 of The Codes on Takeovers and Mergers and Share Repurchases (the "Takeovers Code") issued by the Securities and Futures Commission (the "SFC"), Rule 13.09(2) of the Rules Governing the Listing of Securities (the "Listing Rules") on The Stock Exchange of Hong Kong Limited (the "Stock Exchange") and the Inside Information Provisions (as defined under the Listing Rules) and 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 28 June 2017 (the "Announcement") in relation to a possible privatisation of the Company by Mr. Wen Yibo and Changjiang Capital Fund ("Changjiang Capital") (collectively, the "Potential Offerors"). Unless the context requires otherwise, terms used herein shall have the same meanings as in the Announcement.

Possible Proposal

The Board wishes to inform the Shareholders that it received two letters from the Potential Offerors on 15 June 2017 (collectively, the "Letters"), in which the Potential Offerors informed the Board that they are in the preliminary phase of considering the feasibility of pursuing a proposal for the privatisation of the Company, which, if proceeded with, could result in the privatisation and delisting of the Company from the Stock Exchange (the "Possible Proposal"). The Board is also informed by the Potential Offerors that, in relation to the Possible Proposal, the Potential Offerors are acting in concert.

The Board is now actively considering the Letters and the Possible Proposal. The Board has also commenced preliminary discussions with the Potential Offerors. As at the date of this announcement, no terms of the Possible Proposal have been agreed.

The Company shall keep the shareholders and the public informed of the progress of any relevant development by way of further announcement(s) as and when appropriate.

Background Information about Changjiang Capital

According to the information available to the Board, the ultimate beneficial owner(s) of Changjiang Capital are HE Xiao Jiang, XING Lei, YAN Fung, CHAN Chun Tung, Eagle Best Limited, Millennium Prudent Fidelity Investment Limited, LEE Mo Ching, LEE Kwok Shuen, LEE Yan Yee May, CHEUNG Siu Chuen, CHAN See Ming, TSANG Kwok May and CHUNG Ching Yee, and it carries on the business of investment activities.

Shares in issue

As at the date of this announcement, the Company has a total issued share capital of 1,506,205,421 shares (shares in the Company shall be referred to as "Shares") and certain share options pursuant to which an aggregate of 33,336,000 new Shares may be issued. Save as the aforementioned, the Company has no other relevant securities (as defined in Note 4 to Rule 22 of the Takeovers Code).

The Potential Offerors are the controlling shareholders of the Company who are interested in 1,025,685,534 Shares, representing approximately 68.1 % of the total issued Shares of the Company as at the date of this announcement.

Disclosure of dealing in Shares

For the purpose of the Takeovers Code, the offer period commences on the date of the Announcement (i.e. 28 June 2017).

Associates (having the meaning given to it under the Takeovers Code, including persons holding 5% or more of the relevant securities of the Company) of the Company are reminded to disclose their dealings in the relevant securities of the Company under Rule 22 of the Takeovers Code.

In accordance with Rule 3.8 of the Takeovers Code, reproduced below is the full text of Note 11 to Rule 22 of the Takeovers Code:-

"Responsibilities of stockbrokers, banks and other intermediaries

Stockbrokers, banks and others who deal in relevant securities on behalf of clients have a general duty to ensure, so far as they are able, that those clients are aware of the disclosure obligations attaching to associates and other persons under Rule 22 and that those clients are willing to comply with them. Principal traders and dealers who deal directly with investors should, in appropriate cases, likewise draw attention to the relevant Rules. However, this does not apply when the total value of dealings (excluding stamp duty and commission) in any relevant security undertaken for a client during any 7 day period is less than $1 million.

This dispensation does not alter the obligation of principals, associates and other persons themselves to initiate disclosure of their own dealings, whatever total value is involved.

Intermediaries are expected to co-operate with the Executive in its dealings enquiries. Therefore, those who deal in relevant securities should appreciate that stockbrokers and other intermediaries will supply the Executive with relevant information as to those dealings, including identities of clients, as part of that co-operation."

Suspension in trading of the Shares

On 13 April 2016, trading in the Shares of the Company was suspended under Rule 8(1) of the Securities and Futures (Stock Market Listing) Rules (Chapter 571V of the Laws of Hong Kong). The reason is that the SFC has found that the bank balances of 5 bank accounts of the subsidiaries of the Company as at 31 December 2012 and 31 December 2013 were materially overstated by around RMB2.1 billion and RMB2.7 billion respectively. As at the date of this announcement, the SFC has not received from the Company any submission or representation which can satisfactorily explain such material discrepancies in its bank balances.

The Board hereby announces that on 19 January 2017, the Company engaged PKF Business Advisory Limited (the "Reviewer"), to perform investigation services to the Company in respect of the above. The Reviewer will provide the Company with an independent investigation report to summarise the findings and recommendations to the Company. Further announcement will be made on the findings by the Reviewer when the independent investigation report has been received and assessed by the Board.

Updates

In compliance with Rule 3.7 of the Takeovers Code, monthly announcement(s) setting out the progress of the Possible Proposal which may result in the privatisation and delisting of the Company from the Stock Exchange will be made by the Company until an announcement is made of a firm intention to make an offer under Rule 3.5 of the Takeovers Code or of a decision not to proceed with the Possible Proposal. Further announcement(s) will be made by the Company as and when appropriate or required in accordance with the Listing Rules and/or the Takeovers Code (as the case may be).

WARNING: The discussions in relation to the Possible Proposal are still preliminary. There is no assurance that the possible transactions mentioned in this announcement will materialise or eventually be consummated, and the discussion in relation to the Possible Proposal may or may not result in the privatisation and delisting of the Company from the Stock Exchange. Shareholders of the Company and potential investors are reminded to exercise caution when dealing in the Shares. Persons who are in doubt as to the action they should take should consult their stockbroker, bank manager, solicitor or other professional advisors.

By Order of the Board

Sound Global Ltd. Wen Yibo

Chairman

Hong Kong, 24 July 2017

As of the date of this announcement, the executive Directors are Wen Yibo, Luo Liyang, Zhou Hao, Liu Xiqiang and Liu Wei; and the independent non-executive Directors are Ma Yuanju, Zhang Shuting and Luo Jianhua.

The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, having made all reasonable enquires, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

* For identification purposes only